No matter what size company you’re at or if you’re just a team of one, the value of social media has likely been brought up. Is the advertising you’re doing enough? How much are you really spending between all of your tech stack subscriptions? Have any of the campaigns been worth the investment? These are all great questions to consider and having a social media budget outlined will help you do so.
This guide is meant to help businesses both large and small. No matter the size of your company or wallet, budgeting is still the same at its core basics. Once you start tracking these numbers, you’ll find it easier to decide on testing new strategies and analyzing how well past ones still work.
There are many components that could fill up your social media budget and we’ll go over each one. Skip to the sections via the links below:
- Why have a budget?
- Use goals as your foundation
- Employees and training
- Content creation and production
- Software and subscriptions
- Advertising
- Paid partnerships
- Analyze everything
Why have a social media budget?
In the Sprout Social Index, Edition XIV, we discovered that 55% of social marketers list measuring ROI as their top challenge. If you’re not able to accurately measure social media ROI, then you’ll have a harder time justifying any investments. This applies to whether you want to solo invest in a new software or prove that social media marketing is working to the C-suite.
Budgeting helps you keep track of your costs, which then figures into the ROI calculations. So how do you get started? First, decide on how you want to track your budgeting. It can be with a manual spreadsheet, worksheet that you fill out at the beginning of the year, or even post-it notes that you move around.
Next, you’ll want to consider how you actually want to administer the budget.
- Traditional budget: This is where you start with a sum of money and then allocate amounts to each category. Once a category is depleted, you can’t do anything else in it.
- Flexible budget: This is where category depletion can be fulfilled by another category. Did one run out of money and another category has extra to spare? Move it over.
- Zero budget: This is when you start every category with zero at the beginning of each budget planning cycle. You increase the amounts per category, justifying the cost every time.
There are many, many ways to budget for marketing. Some even just take a lump sum and deduct as you operate. This isn’t advisable if you have multiple components to track because it makes it more difficult to see how well your budget is performing.
Goals are your budget’s foundation
You won’t know how to allocate your budget until you know what your social media goals are. For example, if you’re hoping for more brand exposure, you might invest more heavily into paid ads that drive that and less into a pricey software upgrade.
To help you drive some of your goal setting, refer to the previous year’s goals and budget allocations. Did you meet them? Which strategies were successful? Do you want to increase resources to drive new strategies or expand previous ones?
Once you decide on goals, the next thing to consider for a budget is all the different parts that factor into one. Not every element we list may make sense for every organization’s budgeting, so take that into consideration as you start to list out what you need.
Employees & training
Part of your marketing budget might include the team’s payroll and administration expenses. This may already be calculated into the company’s bottom line. If this is the case, you can ignore the payroll part. For a small business, having anyone dedicated to marketing is an investment. You want to make sure that you’ve included their payroll amounts and any salary increases or bonuses into this area.
As you might know, social media is constantly changing. Keeping a pulse on the industry requires time and any new feature also demands time to learn. When Stories first launched on Instagram, marketers had to spend time trying to thoroughly learn how to use it on the platform and how to fit it into their marketing plan. Some companies flat out ignored the feature until much later while others took the potential risk of diving in and testing out content for the format.
No matter how big your team, training will always be part of your budget. If you don’t learn or adjust to new features, you risk falling behind your competitors.
Content creation & production
Content creation takes a lot of time to produce. Whether you produce it all in-house or you outsource it, it takes money, time and lots of planning. If your marketing strategy calls for multiple posts a day like Benefit’s does, then you’ll need to figure out how to supply all the needed content. Your budget in this area might be much larger in proportion to someone else who posts only several times a week.
One way to alleviate the costs is to incorporate a user-generated content strategy. You’ll have plenty of content to choose from and still be able to fulfill your posting goals. Another idea is to repurpose your existing content across multiple channels and media types. Could you edit a video to make a gif? Or turn quotes from an article into a graphic?
And don’t forget post-production! All that editing and graphic design work still take time and money. You don’t want your effort and expense in creating content to go to waste just because you forgot to budget in the post-production necessary to edit and refine it to meet your brand standards of quality. Finally, if you are going a paid content route, you’ll need to include that content creation either here or in the general advertising budget.
Software & subscriptions
Known costs are ones that you renew on a monthly or annual basis. They include subscriptions to management and analytics tools or customer support and email platforms. Whatever helps your marketing run smoothly should be included in this area. If you are considering changes or new software trials this year, you may want to include some padding to the budget. If the scope of your social marketing is expanding and you find you need the added efficiency of a new management tool, you may want to use some of the research from your budgeting process to help develop a business case that will help you secure buy-in.
Advertising
Advertising is another big budget area. For multi-channel companies, you’ll need to decide on how much to provide for each channel. If Facebook is your biggest channel, it would make sense for you to put more money towards that. The average Facebook ad cost per click was $1.72 across all industries but it could be as low as $0.45 per click if you’re in the apparel industry.
If you want to build up your audience more on Instagram, then Instagram ads would be the way to go. Thankfully, you can manage both Instagram and Facebook ads from one location or even have the same ad served on both channels.
If you’re just starting out on social media advertising, we advise learning the basics first and be open to experimenting with different platforms and different content approaches. Testing different strategies does take time and money, so you’ll want to factor that into your advertising budget.
Paid partnerships
Influencer marketing campaigns and brand partnerships are everywhere on social media. They’re effective at increasing your brand presence and getting new customers into the virtual door, but they do cost money to implement, especially depending on the size of the influencer’s audience. With the addition of paid partner tags on various platforms, it makes it even easier to see how well a partnership is performing.
Analyze everything
You won’t know if you’re using your budget well if you don’t take a look at the data. Was that campaign actually worth the time and money you put in or was it a sinkhole? Could you have spent less on advertising but had the same outcome? These types of questions can be answered as long as you’re continually reevaluating your budget.
Software like Sprout can help you track campaign performance and team performance, such as how much time your team is putting into answering customers and how many messages a day are getting responses.
Budgeting shouldn’t be a set it once and forget kind of approach. Especially in social media, things change quickly. A viral moment may require you to move money around to capitalize on it. A feature you were hoping to focus on might be dropped by the platform or lose audience interest.
In the end, a budget helps you organize your team and your strategy. For larger companies, a budget and analytics are what you need to advocate for more money. Social media budgets aren’t limited to only the personnel who run the accounts or the time it takes to assemble posts. Budgets also include the software you use, content creation and production, advertising, training and paid partnerships.
Once you have it all laid out, it’s much easier to see what your ROI is and if you can make adjustments in any areas. Use this guide to help you break down what you need to include in a social media budget. Having a clear idea of the expenses and requirements involved will help you be more focused and realistic when planning out an overall social media marketing strategy.
This post What you need to know to create a social media budget originally appeared on Sprout Social.
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