Before you start to allocate marketing budget for China, it’s helpful to know how much you have to spend overall. The size of your marketing budget depends on your goals and how much you have to spend. Whatever the amount is, around half of it should go towards digital marketing initiatives.
With that in mind, it’s important to note that every company and industry is different. Some organizations will require much more to go towards digital, or will spend a higher percentage of the overall revenue on marketing activities.
You’ll need to know what’s standard in your business and what expectations are set for you before you begin. It’s not that easy because the Chinese landscape is different.
Once you’ve determined your overall marketing budget, you can start working on allocating it. Here are five steps to follow when allocating marketing budget for China.
Step one, set marketing goals before you allocate marketing budget
Setting your marketing goals is a crucial part of creating a marketing budget plan. Your goals will help determine which channels and strategies you use and how you allocate money to them. Make your marketing goals SMART goals, which are:
- Specific: Include details in your goals and avoid vagueness.
- Measurable: Ensure you can measure your progress toward your goals.
- Attainable: Your goals can be ambitious, but they should also be realistically achievable.
- Relevant: Your marketing goals should be relevant to your overall business objectives.
- Time-bound: Set a time limit for achieving your goals to help keep you on track.
Examples of SMART goals include “increase revenue by 30% by the end of the year” or “generate 25 new leads by the end of the quarter.”
Step two, create a plan for the year
To further guide your marketing budget allocation, create a rough plan for your marketing for the year. Remember to keep your marketing goals at the forefront of your mind as you create your plan. Also, consider your buyer’s journey — how your customers interact with your marketing and go from discovering your business to becoming a loyal customer.
To create your plan, you’ll need to decide which channels and strategies to use. Consider channels such as:
- Baidu SEO
- Baidu PPC
- Web design
- Influencer marketing
- Social media marketing
You’ll also need to think about how you’ll use these tactics. Will your internal marketing team do the work, will you hire a marketing agency, or will you work with freelancers? You might use a combination of these methods.
When choosing marketing channels, a good rule of thumb to keep in mind is the 70-20-10 rule. This guideline says that:
- 70% of your budget should go towards strategies you know work well
- 20% should go to new strategies that help your business grow
- 10% of your budget should go towards emerging or experimental strategies to keep you ahead of the competition
Step three, calculate expected costs and return on investment (ROI)
Next, calculate your expected costs for each marketing initiative and the potential ROI. While you, of course, don’t know exactly what your ROI will be, an estimate can help you determine how to allocate your marketing budget. When adding up your costs, be careful to account for all of your potential expenses, including the less-obvious ones.
Calculating your expenses helps ensure you allocate enough money to each channel. Estimating your ROI gives you an idea of how worthwhile your investments in each channel are. You may want to invest more in high-ROI strategies.
Step four, allocate your spending
Now, based on all the information you’ve gathered, you can split up your spending across the channels you’ll use. Remember to keep your goals, expected costs, and expected ROI, as well as marketing budget allocation best practices, in mind. Let’s look at a simplified example of how a company might divvy up its marketing budget.
Step five, measure and refine when you allocate marketing budget for next year
As your campaigns run, carefully track your key performance indicators and measure your campaigns’ success. You can then use these findings to refine how you allocate your marketing budget. If a campaign is performing exceptionally well, you might choose to allocate more funding to it.
If a campaign is underperforming, evaluate whether you should adjust your tactics or reduce the funding you allocate to it. Be careful not to pull funding prematurely from a channel that’s important to achieving your goals. In addition to adjusting your spending as you go, compile your campaign and ROI data and use it when planning your marketing budget for the next year.
For your marketing strategy to be successful, you need to spend money on the right things. Strategically allocating your marketing budget is a crucial marketing task and one that can get overwhelming if you’re not sure how to go about it. Tell us about your goals, and we’ll help you choose the right digital marketing channels for you and create a data-backed strategy for each channel. Our expert digital marketing services can also help you get the highest possible ROI.