Posted: 12 Jan 2023 Contributor: Ghia Marnewick
Digital Advertising Guide 2023: Budget Planning Tips & Strategy
Digital advertising spending will reach $248.72 billion in the United States this year, up 12.5% by 2021, according to our forecast updated at the end of October. Spending rose to 37.2% last year but has dropped significantly in 2022 to plan when the disease grows. Our Crystal Ball: In 2026, digital media spending will reach $385.47 billion and account for 80.9% of total media spending.
The strongest growth in US digital advertising spending in 2022 is expected to come from the business sector. According to market analysts, this sector is expected to spend 20.2% more on digital advertising this year. By comparison, the average across all industries is 15.6%. Next is the consumer goods industry, whose digital advertising spending in 2022 is 17.9% higher than in 2021.
The top five industries are:
- Entertainment: 16.5%
- Computers and consumer electronics: 15.3%
- Travel: 14.2%
What Is Digital Advertising?
Digital advertising (also known as online advertising) is a form of marketing that companies use to promote their brands, products, or services through digital channels. These are actions on web browsers, social media pages, blogs, applications, or any other form of contact via the Internet.
With the digital revolution, many options are available for companies to communicate with the market and, of course, with their audience. In this way, everything that is done using digital platforms and resources can be considered digital media. The main goal is to be right in front of the audience. Digital media is a process of migration and the movement of companies and movements of all societies.
After all, if 4.18 billion people use their phones to connect to the Internet, their business will also have a presence on that channel, boosting their relevance and awareness.
Differences Between Traditional and Digital Advertising
The main difference between digital and traditional marketing is the way the audience receives marketing information. While traditional marketing uses traditional media such as newspapers and magazines, digital marketing uses digital media, such as social media or websites.
Of course, traditional marketing is by no means obsolete. Traditional marketing still plays an important role in people's lives and the need is ever increasing to move away from the digital world.
Along the same lines, digital marketing is just as important, if not more, than traditional marketing. Digital marketing uses every sign of the internet you use every day to reach you.
Important Digital Advertising Strategies for Year 2023
Many businesses are building their digital marketing plans for 2023 and beyond. Smart companies are looking for the latest trends to integrate to maximize their results and impact. Here are some of the most influential digital marketing techniques that can help increase your success.
1. The Metaverse
Metaverse is one of the most talked about systems in digital marketing. Metaverse is a general term describing many virtual experiences that take place online, often with third parties. Starbucks, Nike, and many other big brands have announced different experiences. While there is excitement for Metaverse, many companies have yet to make a use case (or ROI).
2. Artificial intelligence
Artificial intelligence (AI) powers all marketing. One of the coolest digital marketing trends in the last few years is the integration of AI into almost every digital marketing channel. Algorithms determine which social media messages you interact with, which search results you see, and even which ads are shown to you. AI improves marketing, connecting consumers with the right products and information.
3. Customer experience
Many algorithms and AI in digital marketing are optimized for the same purpose: creating a better user experience because that is the most important thing. For example, search engine optimization (SEO) this year focuses on delivering the most valuable content to users. Beat the algorithm and delight your customers by putting more focus on their experience.
4. Short video
TikTok and Instagram Reels have taken over social media. There's no doubt that this trend will continue to develop. For businesses to be relevant, they need to appear in the channels and systems where their customers are. The good news is that the short form of video is making its way into social media management tools and planners, so it will be easier for businesses to plan and publish next year.
5. The message is simple and clear
With shorter video takeovers and shrinking attention spans, businesses are facing greater challenges than ever. Businesses need to be able to communicate shortly and quickly to attract attention on mobile devices.
As the media space expands, businesses must find new ways to reach their target audience. Increasingly, commercial companies can find opportunities to use content to monitor the buzz from influencers. Influencer marketing has been on the rise for years, and this trend will only continue as influencers build larger and larger audiences for consumer choice.
7. Employee advocacy
Employee advocacy is about getting your team members or employees to speak up and share on behalf of the company. Many companies identify the strengths of their employees. Personal profiles and user assets are often more effective in reaching more people in a more realistic way than business accounts and assets. Harnessing this power is an untapped opportunity, especially in the business-to-business (B2B) market.
How to Allocate Budget for Digital Advertising?
These steps will help guide your budgeting program for digital marketing activities.
1. Use a marketing budget tracking tool
A structured budget template is an important barrier for any growing organization. This document should contain your budget, track the budget and analyze variances. Without a budget manager, you can't accurately measure marketing spending or make changes to improve ROI.
In addition, the marketing budget manager allows you to visualize the data and organize it by group. Analyzing and evaluating past budgets can help shape future digital marketing budgets by comparing proposed expenses, actual expenses, and the results of that budget.
2. Review your company's marketing goals
Before allocating a digital marketing budget, your team should be prepared for:
- The most important thing of the meeting for the coming time.
- Which strategies will customers support – and to what extent?
For example, the company may have a large advertising campaign in the quarter. In this situation, different regions may need to work with media organizations to publish open jobs on social channels. However, this plan will not necessarily involve the budget of the marketing team. Other time-sensitive initiatives – such as product launches, offers and promotions, and product or subscription events – will require marketing support (and budget).
3. Review last year's quarterly results
Your digital marketing budget is an ongoing project that requires constant review. Maybe you poured $10,000 into Facebook advertising last month and saw few clicks, few conversions, and zero revenue. If so, it would be wise to pause to analyze the ad and analyze the data. Continually monitoring the performance of marketing activities will help you allocate money appropriately.
4. Determine the appropriate channels
The digital marketing channels you use will vary depending on your company. To decide who is the best fit for your business, ask yourself these questions.
- Should we raise awareness?
- Is it an inbound marketing strategy?
- Do we want to target specific audience groups based on TV like job title and age?
- Should we target audience members based on intent and behavior?
- Do we want to increase awareness and track ideas and traffic?
- Is our goal to increase flexibility and follow qualifying activities?
In addition to looking at past marketing efforts, there are other important marketing activities to consider. Creating a customer base, conducting interviews with customers and influencers, and analyzing the current online audience will provide the information needed to select the most important marketing channels.
5. Consider salaries, wages, and production costs
A marketing budget should consider all aspects necessary to deliver results, including:
- Software fees
- Market research fee
- Website cost
- Company fee or freelancer
6. Complete your digital marketing budget
After considering other expenses and deciding where to spend the money, it's time to finalize your marketing budget and submit it for approval.
Be sure to include any information gathered during the review process that will help support your case. The more details you can include, the better.
Digital Advertising Examples
There's nothing better than knowing examples of things that can be used in your digital media planning, right?
That's why we've divided 4 application examples to inspire you to find the best ideas for your business. Check it out!
1. Search Engine Marketing (SEM)
An indicator of the digital revolution is undoubtedly the use of Google (and others such as Bing and Yahoo) as a source of queries on the Internet. On Google alone, there are about 75,000 searches per minute. Considering that this is the most used page for research - the interest of 92.07% of users - how can you ignore it? In the space of advertising in search engines, two different methods are used to make search engine optimization: SEO (Search Engine Optimization) and paid advertising.
SEO represents the methods and techniques to generate organic traffic. With strong linking, keyword highlighting, and high-quality content that is important to readers, the page can appear in the ranks among the top search results.
It takes a long time. However, the prices are low and the yield is good.
Paid advertising, on the other hand, consists of advertising fees that companies pay only for users who click on their ads, thus maximizing the use of its resources.
2. Advertising displays
Closer to the concept of traditional advertising, using visuals means creating images and text to attract the user's attention.
A common way is to use banners and ad spaces on the website specifically for your target audience. For a sports goods e-commerce store, for example, a sports magazine page can be a good place for display ads.
In practice, it is the same concept as advertising on the pages of a newspaper or magazine. It may not be effective when it comes to influencing a highly fragmented audience.
However, visual advertising is a great way to grab users' attention and ensure they click on your message.
3. Social media
There is no doubt that social media is one of the most effective channels to communicate with your audience. The number of active users on Facebook is 2.5 million, while YouTube, WhatsApp, and Instagram add another 4.5 million. On average, studies show that users spend almost an hour a day on these channels. For those who want to increase their brand awareness and digital presence, it is important to be on these platforms and promote their products and services.
In an organic or paid way, it is possible to reach many people and, better, in a segmented way. With a low budget, social media is also a great channel for digital advertising.
4. Advertising by email marketing
Although email is an old channel of the Internet, it is still popular. The use of this channel is growing between 2% and 3% per year until 2023, according to Statista. The main reason? Public interest. Adestra research shows that 73% of millennials prefer communication and business to be done through this platform. The good news? DMA research shows that 99% of consumers check their email every day.
Since more people are connected to this channel, you will be able to get closer to your customers. Also, the ROI of email marketing is very high.
The average return on investment for email marketing is $40 for every dollar spent. To capture that return, you need to think about four things: getting qualified subscribers, engaging your audience, keeping your audience informed, and finding automation tools to help you in this process.
The first point, getting qualified subscribers, is what your business will do physically, by delivering high-quality content to the target audience. The main rule here is: don't buy someone else's mailing list.
These people have not allowed you to talk to them, and besides that, they may not be interested in what you are doing. So you have to build your list from scratch, based on people who are interested in what you have to offer.
Digital marketing is more important than ever. Take steps to create, improve your digital marketing strategy today and protect your business from any unexpected global and industry changes.