A Simple Guide to Calculating A Social Media Marketing Budget.

You have worked hard in researching and developing a social media strategy and plan, but how much will it cost? Budgeting is an important part of social strategy and probably needed if you want your strategy to be executed. Few managers or business owners will approve any effort without first knowing the cost. Understanding expense is also an important step to calculating return on investment (ROI).

Free Social Media Budget Template

To help make the budgeting process easier I have created the Social Media Budget Template shown above. I have broken down costs into five expense categories and divided each category into in-house costs (to be performed by employees) and outsource costs (to be hired out). I also suggest calculating the percent of each line item under a category and the percent of each category out of the total budget to understand where you are spending most of your money. As you understand how each category is contributing more or less to overall success you may want to adjust percentages to match contribution level. Each item and category is calculated as a monthly expense and percent of total per these categories:

Content Creation covers in-house or outsourced time to write and design plus any fixed costs such as stock photos or video production. Estimate time to create the content needed for the strategy in a month. You can get an idea of how much you need from a Content Calendar. For in-house employees divide salary into an hourly rate. For outsourced help calculate by their hourly rate or their cost per piece or project.

Social Advertising is paid outsourced costs for reach per social channel such as Facebook, Twitter, LinkedIn, etc. Again, start with a Content Calendar and estimate how many posts will be paid native ads or promoted/boosted posts. Then calculate costs based on current rates per social media network. Because much of social advertising works on a bidding process many managers set per day limits. Thus, this category is estimated based on spending per day, per network multiplied by the number of days you expect to be running social ads in a month.

Social Engagement is the cost for employees or contractors to listen and respond to brand talk per channel. Listening and engagement are important activities in social media. They cannot be planned ahead of time, but you can estimate how much it may cost based on current activity. You could go back to or perform a Social Media Audit to get an idea of the level of customer activity on brand social media channels. Are there hundreds or even thousands of posts everyday day or a few dozen? From there estimate hours per day needed to engage all or a percentage of those customers per channel. Multiply number of hours by employee or outsourced rates.

Software/Tools covers monthly costs for social media monitoring and other automation software services. These software services and tools can help save time and thus money in other categories such as content creation and engagement. There are a lot of free tools, but to get access to advanced features and enterprise level service many organizations have to pay. This budget category is broken down into monitoring, scheduling and analytics as a first step. You may find it useful to add additional categories such as consumer research, automation, or scheduling software. Some tools may have one time costs but most are billed as monthly access fees.

Promotion/Contests are costs for prizes, discounts, etc. Besides buying reach through native ads, many businesses build audience and engagement through special offers, discounts and contests. Whether they are executed through a Facebook app, hashtag or unique offer code promotions, contests, sweepstakes, coupons and discounts have hard costs associated with them. In this category estimate those expenses per campaign. For example, you may have a summer campaign and a holiday campaign or campaigns that happen around specific holidays. If you have a social campaign built around a live event, don’t forget to include those costs as well.

Finally, add totals per month, per line item and category. Also calculate percent of each category and category percent of the total budget. This social media budget template is a good way to calculate how much a social media strategy will cost to execute, but how do you know if the total is too much or too little overall?

One way to put total social media budgets into context is to compare to competitors. In a Social Media Audit you may have uncovered insight that a main competitor is much more active in social media and seeing business success as a result. Your strategy would be to increase your social activity to compete and your budget is an estimate of what it costs to match that level of engagement.

Another way to put your total social media budget into context is to compare to industry standards. In an analysis by Content Factory they estimate that outsourcing professional social media marketing can cost anywhere from $1,000 per month to $20,000 per month. Admittedly this number is very broad. Another approach is to look at typical percentages of overall marketing spending and social spending. In other words, take your existing marketing budget and estimate social media spending based on current standards.

Nick Rojas of The Next Web points out that businesses spend an average of 10% of revenue on marketing. Yet, this could vary by industry. For example, B2C products companies spend an average 16% of revenue on marketing. For social spending a CMO survey indicates businesses now spend an average of 9% to 13% of their marketing budget on social media (expected to increase to 21% by 2019). Thus, a general guideline would be to take your marketing budget as a percent of revenue (such as 10%) and then calculate a percent of the marketing budget (13%) dedicated to social media. If your estimated social media marketing budget from the template above is significantly off from this general number you may want to go back and adjust the plan. Or start with the general estimate then go to the budget template to see what level of social engagement you can afford.

Budgeting in social media can be complicated. But taking a step back and calculating costs based on categories and in relation to marketing spending averages can simplify the process. If you are budgeting against a solid social media plan tied to real business goals with the right metrics in place a return on investment (ROI) will be justified.

For more insights into the big picture in social media strategy consider Social Media BookLogoStrategy: Marketing and Advertising in the Consumer Revolution. Free Preview of the Detailed Contents, Forward, Introduction and First Chapter: bit.ly/QuesenberryFreeSample EBook: bit.ly/QuesenberryEBook Instructor Exam Copy: bit.ly/Quesenberry

Marketers & Advertisers: Give Up Control To Regain It.

It is hard being a marketer or advertiser these days. It feels like everything you were taught about marketing and advertising has been turned on its head. Most of the core principles, whether you practice the Four P’s or the Four C’s are about marketer and advertiser control. Yet, the problem today is that the marketer, their advertising agency, and PR firm have lost a lot of control over much communication about the brand.

With the rise of social media the power of the consumer’s voice is now equal or even more powerful than the brand’s voice. Consider the fact that consumers’ trust other people’s opinions online much more than any brand messages you can publish in ads or on the web. As mobile use increases, the consumer’s voice will only get more powerful, more immediate, and more frequent. Customer service departments know this very well.

Social Media Marketing Advertising Public Relations Strategy Keith QuesenberryWe are in the midst of a consumer revolution where the marketer, advertiser, and PR professional are no longer King. Content is King and consumers control what content is viewed, shared and created. Does this mean marketers, advertisers, and PR pros should simply give up? Not in the sense of throwing in the towel, but they need to understand one key lesson for today’s social media environment: Learn to give up control of your brand to regain it. Click To Tweet We may no longer be able to control much of the brand talk online, but we are able to influence it if we switch from our old traditional, mass media control model to a new social media engagement mindset.

A shift in mindset of this magnitude is not easy. The shift to Integrated Marketing Communication was relatively easy in comparison. We simply had to start working with and unify disciplines, partners and channels such as advertising, public relations, direct response and Internet (interactive). But now the consumer is also creating brand content. You can’t have conference calls with consumers and send them your brand standards, marketing plans and creative briefs.

If you want to find your brand these days you must be willing to loose it. This doesn’t mean that social media marketing has no strategy. On the contrary, strategy is even more important. More and more CMO’s are shifting budgets to social media yet most still struggle with integration of social into their traditional marketing, PR, digital and advertising efforts. Others struggle with focusing a strategy in social with such a dynamic environment and simply end up chasing the hot new social channels as they come out.

If you struggle with integration, if you’re missing focus and simply feel social media is out of control, it may be time to take a step back and look at the big picture. Reset your mindset about marketing, advertising, PR, and digital control. Take a 30,000 foot look at your brand, situation, and at what works and doesn’t work in social media to develop a framework that will work today with Facebook and Snapchat and will work tomorrow for what ever new network or mobile app comes out of the tech corridor.

A basic social media strategy framework:

  1. Identify your business goals, marketing strategy and key performance indicators (KPIs).
  2. Determine your target audience, discover where they’re talking online and what they’re saying.
  3. Engage the target on their social platforms with meaningful branded content in a way that leverages each platform’s key capabilities.

This list is incomplete, but it gets you started in a place rooted in your unique situation and drives a strategy of choosing social platforms and creating content based on your business objectives, marketing strategy and target audience. For a more comprehensive look and process for social media strategy I have written Social Media Strategy: Marketing and Advertising in the Consumer Revolution. It will take any marketer, advertiser, PR pro, digital consultant, entrepreneur, or student through a simple step-by-step process to developing a truly integrated and enduring social media plan.

Social Media Strategy QuesenberryGet a free preview of Table of Contents, Forward and Chapter One in the Kindle version via this link.