What is more complicated than having a budget for your ecommerce business? It is the right allocation of funds for the right purpose. We have seen a plethora of examples where ecommerce business platforms go haywire with their marketing spend as they do not have a concrete plan on how to tactfully invest their money at the right place.
There are no qualms about the fact that we live in a dynamic business world where online selling has become a ‘big thing’. Moreover, with the marketing trends changing rapidly, there can be a chance of ecommerce businesses getting overwhelmed by the situation and losing track of their marketing budget.
The neatest trick to thrive in today’s ever evolving world is to readjust your marketing budget plan according to the situation. Also, make sure that the readjustment of the budget should be data-driven and must have some solid base before the changes are made.
Therefore, in this blog, we will discuss the proven tips and tricks that will help the online business platforms to divide their marketing budget for the ecommerce business easily. Moreover, we will also highlight some common mistakes that business houses make in their marketing budget plan.
Let us begin!
In simple words, a marketing budget is the manual that companies can use to stay on track with the estimated and actual cost. It is a detailed document that has all the money plans that the company needs to spend over a specific period of time. It could be a week, a month, quarter, a year, etc. The marketing budget breakdown has everything from:
The realm of ecommerce is a thriving land and there is no denying this fact. But even in a thriving land, there are chances that the business organization won’t reach their potential if they don’t follow a concrete strategy. Thus, it is essential to have a market budget. The other important reasons why you need a marketing budget are:
It helps in setting goals
Having a well-researched and defined marketing budget will help the ecommerce business owners to set realistic expectations. Based on the budget, it will be easier for the businesses to choose their marketing channels and have a well-guided approach while reaching out to their targeted customers. Moreover, with realistic expectations, the business owners will understand how to take their business forward, thus expanding at a brisk rate.
Allocating the funds at the right place
We addressed this situation right at the beginning of this blog. If the ecommerce platforms understand how much they have to spend at their nascent stage itself, the haphazard marketing spend can be reduced by a great deal. Moreover, it will also allow the ecommerce company to find if they need a digital marketing agency and if it fits in their scheme of things or not.
It helps in long term growth
Having a marketing budget for your business can give you a long hand in planning things in advance. Ecommerce business houses must understand that a marketing budget plan will prevent the situation in which you have to stop a campaign due to money crunches. Instead, it would give your business a cushion, a flexibility to experiment keeping the future in mind. Clear long term perspectives will help in creating a definite and effective marketing strategy.
After understanding the basics and the need of having a marketing budget plan, it is time to understand its bifurcation. For ecommerce businesses, marketing on a budget will help them target their audience effectively and reap rich benefits with minimal investments. Below are some effective and critical points that will help the ecommerce company to structure their marketing budget.
Determine what you want to achieve
Well, it is a straightforward fact. Every guide to how to make a marketing budget plan will tell you to understand your business goal. Once the business organization knows what it wants to achieve, it can set budgets accordingly and follow that plan for longer periods of time.
The business goal can be anything such as:
Moreover, while determining your business goal, make sure that it is specific and smart. For example, if you wish to increase your sales, you must have a specific target in mind. A definite goal makes it easier to devise a plan and the entire work process more streamlined.
Establish a sales cycle
Having a sales funnel is critical while creating a marketing budget breakdown. It becomes a critical component as it will define where you are actually going to spend your money. A basic sales funnel has four different stages such as:
Problem awareness: At this stage, the ecommerce business will make their target audience realize that they have a problem and they desperately need a solution for it.
Considering different options: Here after realizing the problem the target audience begins to look at different solutions.
Focusing on solution providers: This is where the leads begin to reach a decision making stage. After going through the options, they focus on the best solution providers or the product that will solve their problems.
Final action: Here, the audience chooses to become the customer of a specific solution providing business.
So, having a well-directed sales funnel will help the ecommerce business to allocate the right budget to the right stage. Moreover, it will also help them in understanding their sales cycle in a better way and make a specific marketing budget plan.
Proper branding will make the ecommerce business organization to propel into a leader in its niche. Branding will help in better visibility of your ecommerce platform and will bring it up when someone is looking for similar services and products.
Branding is crucial in developing trust among the target audience thus it should be in your ‘what to include in a marketing plan list’.
Along with branding, generating organic traffic is an essential thing as well. According to a research done by Hubspot, organic search generates more than 1/3rd of the traffic for an ecommerce business. Thus, ecommerce businesses should spend wisely while deciding their Search Engine Optimization (SEO) strategy.
Having organic traffic on the website or the mobile app will allow a steady flow of visitors and enhance the overall user base of the ecommerce platform.
Despite having a good branding and optimal organic traffic, ecommerce businesses fail to upscale their sales because they fail at Conversion Rate Optimization (CRO). According to a study, the CRO tools have an average ROI of 223%.
Therefore, it becomes necessary for the ecommerce business organizations to allocate funds to CRO and see their ROIs soaring to newer heights. Moreover, as compared to other strategies such as social media, SEO, etc. CRO proves to be the greatest marketing tool.
Thus, it is needless to say having a competent marketing budget plan is essential for any ecommerce business to thrive in today’s constantly evolving business world. But, it is also necessary for the business organizations to allocate their funds according to their needs and requirements only. Moreover, it is also advised to the ecommerce business organizations to hire an experienced ecommerce solution providing agency as they will be the able ally and will help in making an effective use of the organization’s money.