How to determine a social media advertising budget
Is your organization on social media? Great! Now let me share some unfortunate news with you: Just being on social media isn’t enough anymore. Your strategy needs to contain a social media advertising budget if you want to reach new (and even existing) audiences. But the good news is, you can reach the right audience at the right time, with the right message if you set aside money in your marketing budget for social media advertising.
Here’s how we advise clients to determine a social media advertising budget
Step one: Identify your campaign objectives
If you have a social media strategy in place, you’ve probably identified goals and objectives you’d like to achieve. When you’re thinking about defining your objectives for social media advertising, here are a few options you might want to consider:
- Raising awareness about your brand, company or organization in general. You want people to know you exist. If this is your goal, growing community might be your focus.
- Raising awareness about a specific key message, benefit of your product or area of expertise. If this is your goal, boosting a post or driving website traffic might be your focus.
- Moving the needle on web traffic. If you want to see the numbers for referral traffic in Google Analytics go up, website clicks might be your focus.
- Capturing leads. If you want to collect the contact information of qualified leads who might be interested in the product(s) or service(s) your business offers, lead generation might be your focus.
After you’ve identified the objective(s) for your campaign, set a monthly goal. Example: I want to increase the number of page likes for my organizations Facebook page by 400 each month.
Step two: Use data to determine a starting point
Next you’ll want to determine a cost-per-action (CPA) baseline for your objectives. If this is your first time setting up social ads, you’ll want to use industry averages for your baseline – we’ve provided an average CPA that you can use as a starting point in our social budget worksheet. Full disclosure: The data is based on a mix of industry-wide statistics and our experience doing social media advertising for clients. The numbers tend to skew a little higher that some sources, because we typically use extremely specific audience targeting, which often has a higher CPA. If this isn’t your first social media ad rodeo, you can use historical data specific to your organization’s CPA.
Step three: DO MATH!
Take out your calculator and get ready to do some calculations. Multiply the CPA you’ve identified by the measurable objective(s) you’d like to achieve. Example: I want to increase the number of page likes for my organization’s Facebook page by 400 each month and the average CPA for a Page Like is $1. 400 page likes x $1 CPA = $400 budget.
If you have multiple objectives to accomplish on multiple platforms, do the math for each one. The more objectives you have, the larger your budget will need to be.
Step four: Set up your ads
Now that you’ve outlined a budget to get you started, now the fun begins: AD SET UP! Once you’ve set up your ads you also should keep track of your results. Start looking for patterns such as a specific category of content that results in higher click-through rates or a lower cost per click. At the end of the month, you’ll be able to check your results against the goals you outlined in step one, and determine if you’re campaign was a success or if you need to go back to the drawing board.