How to Create and Manage a Media Budget
What is a media plan and budget?
A media plan is the course of action a marketing team will take in order to maximize sales, convert leads, and increase the bottom line. Media planning requires an in depth understanding of your target audience and the media channels that best serve your campaigns. The media planner can hold various titles, but regardless of title will have experience in and knowledge of media, content creation, marketing, and budgeting. The components of a media plan include audience, marketing budget, conversion goals, definition of success, message frequency, and message reach. Using these components as a checklist will provide a solid foundation to reference as you move to execute your media plan.
A media budget is exactly what it sounds like – the amount of money allocated to marketing efforts through traditional and digital forms of media. Your media budget, when well researched, will facilitate execution of your media plan. To maximize your dollars, it is important to research what forms of media perform best with your target audience. As ad spend in digital media continues to rise, you may want to consider social media marketing costs and how a social media budget can improve your reach. For example, CBO Facebook ads may work in your favor as they are estimated to have a 9-10% conversion rate (higher than Google ads).
Why is budget important in media?
Budget is important in media for several reasons. Budgeting for media spend will help prevent overspending or wasting dollars on ineffective media channels.
Generally speaking, about 7-8% of a company’s gross revenue should be allocated to marketing and advertising. At 2 million dollars of gross revenue, that’s $140,000-$160,000. Whether those numbers seem high or low, if we look only at social media marketing costs companies are spending on average $72,000-$126,000 per year. If half or almost all of your budget is spent on social media campaign costs, it is vital to know which channels are most effective at reaching your target audience.
Media budgeting also provides direction of ad spend on the proper product at the proper time. Your budget will determine if an ad will run continuously throughout a campaign or intermittently. Ultimately, a media budget aligns marketing efforts with business goals, which in turn should secure upper management approval with little pushback.
How do you manage a media budget?
Managing a media budget requires knowledge of and confidence in the budget itself. For starters, you cannot manage what you cannot see. Selecting a budget template or software will help keep things organized and there are plenty of options to choose from. You will also need to have a good understanding of the current marketing strategy and campaigns. Campaigns are determined by budget, and in order to track spending you will need to know which campaigns are running and which are up next.
Of all factors to consider, it is imperative that you manage your budget based on data. Many companies use marketing attribution softwares to help track this data, and the information provided is a great way to take the temperature of your media budget and plan. Lastly, assess if your goals are being met. Keep in mind that one of the primary objectives of the media budget is to facilitate execution of business goals. Frequently monitoring your campaigns and conversion rates provides insight to answer the question, “Are we meeting our goals?”
What are the three objectives of a media plan?
The three objectives of a media plan are to establish purpose, audience, and reach.
The general purpose of a media plan is to support the larger marketing objectives. More specific purposes may be to generate brand awareness, or encourage users to share a specific piece of content that has been optimized to perform well.
Audience is usually already defined by the time you get to media planning, but your target consumers can vary depending on the form of media. Knowing who will be reading, consuming, or engaging with your content and understanding their buying habits will help convert leads and nurture existing consumer-brand relationships.
Reach depends greatly on your target audience and the media channels they consume. For example, your reach using radio ads may be significantly lower than pulsing social media ads. When it comes to reach, frequency is the most important factor in increasing visibility. There are several approaches to publishing frequency and each comes with an associated cost, so it is important to identify which approach(es) will be deployed to best plan your media budget.
How do you verify a media budget?
Verifying a media budget is achieved through ad verification. Fraudulent ads have become increasingly common with the rise of bots and can waste budget dollars by redirecting a target consumer to an irrelevant or malicious site. Ad verification is a relatively new technology in digital advertising that relies on an impartial third party vendor to track metrics like viewability, ad placement, geotargeting, fraudulent activity, and site context.
What is a good media strategy?
A good media strategy can be characterized by five elements: smart goals/objectives, target audience assessment, defined media channels, organized budget and campaign planning, and performance measurement.
- Goals and objectives – should align with business objectives and be specific, measurable, attainable, relevant, and time-based.
- Audience assessment – should give you actionable insights on your target consumers’ interests, demographics, geographics, and most used media channels.
- Media channels – should be determined based on the audience assessment and optimized for SEO and SMO.
- Budget/campaign planning – should provide an overview of where and how budget dollars are being spent and a timeline for when campaigns (and associated ads) are to be launched and ended.
- Performance measurement – should provide analytics across all media channels to assess how your ads are performing.
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