Social media marketing has become critical for brands of all sizes, from enterprises to small and medium-sized businesses (SMBs). Budgets now occupy a significant share of overall digital marketing spend and are typically divided across various categories. This raises a variety of questions for marketing leaders during the budgeting process, including:
Of course, the answers to these questions depend heavily on the goals of a particular brand and what they want to achieve. Creating a social media budget and choosing the right social software tool for monitoring performance is crucial for marketers who want to meet or exceed their goals. A well-defined budget ensures allocating resources where needed most while selecting the best software empowers brands to optimize their social media strategies. This strategic combination enables brands to maximize their online presence, engage with their target audience and drive measurable results, which ultimately lead to success.
A social media budget is the amount of money a brand or business plans to spend on social media activities over a defined period. The budget will typically outline the activities and associated costs for the next quarter, six months, or year. It serves as a financial roadmap, guiding the allocation of resources toward achieving social media marketing goals and objectives.
Social media budgets are essential as they can help accurately measure the ROI of various projects, activities or initiatives. It’s necessary to understand the goals of your social strategy to know what you should be measuring and spending your budget on. A robust social media management platform can help with the measurement aspect, and comparing social media marketing tool prices can help you figure out a suitable budget. Consider features such as community management and social listening if growing a happy, engaged audience is what you want to achieve, or a tool for measuring the ROI of influencers or ambassadors programs if you are more creator focused.
When crafting a social media marketing budget, it's important to consider various aspects contributing to a comprehensive and effective strategy. Beyond workflow tools and software for measurement and insights, the budget should include all costs associated with social media marketing.
To maximize impact, you should select the right tools and software tailored to the channels where your brand's audience is most active. By considering these key elements, brands can create a well-rounded social media budget that aligns with their goals and reaches their target audience.
Team members and talent could include new hires, freelancers, influencers, creators and brand ambassadors. Building a strong internal team and leveraging the expertise of external freelancers and the influence of creators can contribute to the success of your social media marketing efforts. By incorporating talented team members when needed and creators strategically, brands can increase their online presence, effectively engage with target audiences and help increase overall revenue for the business.
By allocating a portion of your social media budget towards paid social tactics like targeted advertising and promotional campaigns, you can amplify your reach, increase brand visibility and drive revenue for your brand. Promotional campaigns can also cross over with your talent budget. Paid creator or influencer content is great for speaking to untapped audiences or followers you wouldn't typically reach. Careful planning and optimization of paid spend can lead to big returns on investment in your social media marketing strategies — the right influencer marketing measurement tool lets you quantify your paid influencer and brand ambassador efforts.
External resources such as agencies and consultants can offer valuable expertise and support if necessary. Working with these professionals (if there's room in the budget) can provide specialized knowledge and guidance to enhance your social media marketing strategies.
When creating a social media marketing budget, brands must select the appropriate tools and software that align with the channels they want to prioritize. Consider where your target audience is most active and identify the tools, platforms or software that best support those channels.
Tools and software can swallow up much of a social media budget. As budgets get smaller or allocated elsewhere, external resources and paid social can become more of a ‘nice to have’ than a ‘need to have’. Employees' costs are often not considered part of the budget for a larger, established brand. Brands' average cost on social media marketing also differs by company size, target market, industry, and overall company annual sales. With all that said, here are the approximate budgets small, medium, and enterprise businesses should expect to allocate to social media marketing to be competitive.
According to the most recent study by Statista, small businesses in the US can expect to spend 27% of their advertising budget on social media. In Canada, small businesses with less than 20 employees spend around $30,000 a year on marketing initiatives.
Medium businesses in the US share the same 27% budget allocation to social media activities as small businesses. It’s not to say they spend the same amount, but instead, as budgets increase, the percentage spent on social activities remains the same. On average, medium-sized Canadian companies with 20 to 49 employees spend $60,000 yearly on marketing.
Enterprise companies in Canada with 50 employees or more often allocate marketing budgets surpassing the $100,000 mark.
The amount or percentage of the marketing budget allotted for social media marketing activities will differ for each business, brand, or organization. But on average, according to CMOs from various industries, company sizes and sales revenue in the US, the trend in budget share has increased over the past few years.
In February 2015, businesses allocated just 9.9% of their marketing budget to social media. Fast forward to September 2023, we’re now seeing 16.8% of the marketing budget share put toward social as reported by Statista. The percentage spent on social media marketing across all industries is forecasted to increase over the next five years. And according to the latest CMO Survey in March 2023, it’s reported that 19% of budgets are going toward social media marketing. No matter the industry, the trend points to the growing importance of social media as a marketing channel.
Understanding how to allocate your resources wisely can make all the difference in driving engagement, increasing brand awareness and reaching your target audience. But before you spend a single dollar, you must outline clear goals, develop a roadmap and create a budget proposal. This approach allows you to assess the potential impact of your social media efforts while ensuring you’re staying within budget. By strategically outlining your objectives and financial limitations, you can make informed decisions to maximize the value of your social media investment.
The first step in budgeting a social media campaign is determining your goals. Clearly defining what you hope to achieve through your campaign is critical for allocating your dollars. Are you looking to increase brand awareness, drive website traffic, generate leads, boost sales or enhance customer engagement? You can tailor your budget and strategies by identifying your specific objectives. Your goals will guide your decision-making process, ensuring that every dollar you spend is going towards achieving tangible results. So take the time to reflect on your desired outcomes and set measurable, realistic goals that will shape the foundation of your social media campaign.
Once you have established your goals, the next step is to determine your quarterly ad spend. Allocating an appropriate budget ensures you have sufficient resources to execute your campaign successfully. Start by assessing your overall marketing budget and considering how much you can put toward social media advertising. Consider factors such as the size of your business, the competitiveness of your industry, and the level of exposure you’re looking to get. Look for trends or patterns when considering how previous social media campaigns performed and the ROI gained from past ads. You must also align your ad spending with your campaign goals and budget more resources to areas that require more attention or have a higher potential for generating results. Lastly, don’t forget to leave a portion of the quarterly spend for testing and optimization. Having a bit of budget to test out different messaging, ad formats and targeting strategies can help refine your approach and maximize results.
Determining which platform your audience is most active on is also helpful when deciding quarterly ad spend, as different social media platforms have varying ad costs. To determine which social media platforms those are, you must conduct thorough audience research and gather insights about their online behavior. Here are some effective strategies to identify the platforms where your target audience is most engaged:
Creating a budget proposal can help outline a project or multi-channel campaign's financial requirements and aid in the decision-making process for stakeholders. Having a budget proposal laid out for decision-makers enables them to make faster approvals for your work. The steps taken to create a proposal for your social media campaign can vary, but here are some key steps to consider:
These steps will prepare you with the knowledge and confidence to communicate the expected outcome of your social media campaign and address any questions or concerns that may arise. Don’t forget to review your budget throughout the project duration to ensure your goals are met and adjust as needed.
Regardless of size, industry or annual revenue, finding a social media marketing software that fits your needs while staying within budget is important. B2B buying behaviors have changed. Four out of five B2B software buyers want to research and try a product before talking to a sales representative. In fact, over 50% of millennial B2B buyers never want to speak with a sales representative. If that’s you, you’re not alone. Finding pricing information for the social media tools you want to compare can be difficult. The following are the top four social media management tools on the market, their pricing and most popular features compared to Dash Hudson.
The right social media tool can make all the difference in measuring and achieving campaign goals, not to mention, save you time so you can focus on what’s really important — marketing. Finding a tool that fits your budget and doesn’t break the bank is critical for brands of all sizes, regardless of industry. Dash Hudson’s all-in-one social media management platform equips brands with the tools and insights they need to find success on social. Whether you’re an SMB or Enterprise brand, we have pricing packages to fit everyone's budget.
The amount you should budget for social media advertising can vary depending on your campaign objectives and duration, strategy, target audience and the platforms you want to advertise on. Based on recent studies, CMOs are budgeting between 19% to 27% of their marketing budgets on social media and social media advertising.
A company’s social media advertising budget can be guided by many factors, such as its target audience, the identified marketing goals, competition, the resources available and the ROI they wish to achieve.
Social media managers should begin the budgeting process for several reasons, the first being that budgeting allows for strategic planning and effective allocation of resources. It can help control costs, accurately assess and measure the ROI of campaigns, set realistic expectations, adapt to changes and align efforts with business goals.