Digital advertising spend reached an estimated $325 billion in 2019 and was expected to increase to $389 billion in 2021. Budgets were almost cut in half due to Covid, but are expect to rise again as we are, more than ever, entering the Digital age.
According to a CMO Survey made in September 2021, digital marketing spending has grown to comprise 58% of marketing budgets, reflecting 15.8% growth over the last year, and is projected to grow by 14.7% in the next year. These results are based on a sample of 282 top marketers at for-profit U.S. companies, 94.1% of whom are VP-level or higher.
There’s a good chance you’re contributing if you already have a SEO budget. If not, how much should you spend on SEO services?
Because Invicta Marketing agency is specialized in small and medium sized companies, these are the ones we are going to focus on in this article.
First thing’s first: what do we call a small business?
Based on data from the U.S. Census Bureau, there were 6.1 million employer firms in the United States in 2018 (latest data): Firms with fewer than 500 employees accounted for 99.7 percent of those businesses.
Small businesses are often hailed as a vital segment of our national and local economies and a primary driver of U.S. financial growth.
But what defines a small business?
It’s almost impossible to really answer this question, because there are so many possible definitions depending on the number of employees, capital, industry, etc.
The Census Bureau sums it up perfectly by saying: “No matter how we define small businesses, there’s no question they drive economic growth and are created the way most businesses are: as small start-ups.”
Could nearly half of U.S. small businesses really not have websites?
In one of its articles , the newspaper INC informs us that, “the B2B research firm Clutch did a survey of over 350 small business owners and managers and found that many were lacking what many would consider to be a staple of modern business. The professionals surveyed by Clutch came from companies around the U.S. that had fewer than 10 employees and generated less than $1 million in annual revenue. From this group of respondents, four out of nine (46 percent) reported not having a website.”
This is a pity, because studies have shown that over 70-80% of people will research a company on the web before making a purchase decision, usually by visiting its website. Which could be the reasons explaining this lack of interest for marketing, and especially digital marketing and SEO?
One of the reasons could be the cost of marketing, or perhaps, the lack of knowledge of this cost. When you are asked to spend money, the question that immediately pops in your mind is “But first, how much does it cost!”.
What percentage of my company’s revenue should I spend on marketing?
It is really difficult to have a clear idea because companies usually only offer quotes on their websites, and articles, blogs give too large prices ranges as “from $750 to $1750 for a SEO agency” or write things like “Businesses spending more than $500/month are 53.3% more likely to be “extremely satisfied.”but without any reference to any survey.
Let’s turn to the experts! Luckily, we can always find reliable and/or official sources.
According to the U.S. Small Business Administration, a federal agency, “Marketing isn’t an expense—it’s an investment, one that drives your sales. “
“Small business Trends (an award-winning hub more than three million entrepreneurs and experts) reports that the average business spends 1.08% of its revenues on advertising, with variations from industry to industry. For instance, retailers spend more (about 4%) while restaurants spend 1.93%.”
According to Gartner, Inc., a well-known research and advisory company, numbers are slightly higher. But Gartner does not specify the size of the companies studied, so we can assume that large companies with large budgets are included in this study.
In the annual Gartner CMO Spend Survey, Gartner surveyed 400 Chiefs Marketing Ofiicer and marketing leaders in North America, the UK, France and Germany from March 2021 through May 2021, tracking the critical areas marketers are investing in and where cuts are being made from people, programs and technologies.”
“Marketing budgets have fallen to their lowest recorded level, dropping to 6.4% of company revenue in 2021 from 11% in 2020, according to Gartner, Inc.
Since Invicta also works with France, it may be interesting to note that according to the site of the French Ministry of the Economy, Industry and Numerics, in B to C (sales to individuals), the budget dedicated to marketing generally represents 10% of sales (of the product concerned). In B to B (sales to businesses), it is around 5%.
We can deduce that the average figure will be around 5%. Of course, this number will vary depending on your needs, the size of your company, the targeted market etc ..and it must be a budget you can afford at least 6 or 12 months because the average amount of time needed to begin to see real results of your marketing campaign is 6 to 12 months.
In conclusion, it is important to have a marketing policy for your company and these costs, variable from one company to another, must be treated as investments and not expenses.
For each investment, a return is expected. Can we know how much ROI (return of investment) we should expect to have?
Mind Blowing digital marketing blog shares with us some numbers that speak for themselves:
Based on Litmus report, email marketing ROI stands at 4,200% or 42x. For every dollar brands invest in email marketing, they receive $42 in return.
According to Smart Insights, email marketing has one of the highest returns on investments, yielding $40 in revenue for every $1 spent. By comparison, the ROI of SEO is $22.24 and just $10.51 for mobile marketing.
The cost of content marketing is 62% less than traditional methods.
Is hiring an SEO company worth it?
You are determined, you are 100% sure, your company needs to have its own digital marketing campaign. Let’s make a list of your needs:
- a new or a better website,
- a good SEO,
- advertise on social media
- a good SEA.
But are you ready to do it yourself, or probably, first, to learn how to do it? Do you really have time to learn how to do create a website, create campaigns, to write a blog and moreover to update all of your social media accounts multiple time a month or a week?
Digital marketing is a time consuming subject as there are many elements to take into account which includes but not limited to consumer insight, qualitative and quantitative research, marketing research, competitor analysis, personae identification, SEM, SEO, Link building, performance marketing, running tests, and much more
That is why hiring a professional is worth it; it will save you time and as a result, money.
At Invicta Marketing Agency, we listen to our clients’ needs and define together, according to your budget, the marketing tools that will suit you better.
Call us now to get started improving your digital marketing strategy and online presence!
