The next step in a Game Changing Strategic Marketing Plan is to choose your channels and set a budget. There are so many channels to choose from and what works for one business might not work for another. Deciding how much to spend is another key point. You need to spend enough to get traction but you don’t want to spend all the profit you would have made. Remember, layers are important too. Gone is the day when you could choose one marketing channel and find the success you want. You need more than one. A mature marketing plan will have at least 5 layers..
The first step in choosing your channels might trigger middle school math class flashbacks: data analysis. Now, don't let your eyes glaze over just yet. Data analysis doesn't mean you need to don a lab coat or understand complex equations. Instead, think of it as a detective’s job. Now is the time to take the research you've conducted about your WHO (target market), WHY (unique selling proposition or differentiator), and existing marketing strategy, and use it to decide which channels will give your business the most bang for its buck.
There are multitudes of channels available, each with its unique attributes: social media, search engine marketing, email marketing, radio, TV, print, outdoor advertising—the list goes on. But remember, not all channels will be effective for every business. A local restaurant might thrive on Instagram marketing and local magazine ads, while an e-commerce store could find more success using search engine optimization and email marketing.
How do I research what channels will be best for my companies? Google it. Yes, you read that right. Take your company type (Keep it general) and your target market and ask Google where your target tends to spend the most time. Even better, ask Chat GPT. A.I. takes info from the world of information and can provide answers to questions using regular language. Here is an example of a business search I just did.
I have included the screen shot of the results. You will see I asked it to provide me with three recommendations of how to hit my local market if I were a tire and auto repair shop. It recommended Digital Advertising with Paid Google and Paid Facebook ads. Direct mail was second. Our magazines are direct mail but you could also send post cards or other mailers. The third recommendation is Local Radio. In some markets, radio can still be great. But this is also an example of when the A.I. powered database doesn’t have all the information. For example, Ogden, UT is not a great radio town. Not because we don’t listen to the Radio, but because we are primarily served by radio stations that broadcast out of Salt Lake City and go across the entire Wasatch Front. Unless your business spans that entire area, you will waste much of your ad spend delivering your message to people who are too far away to do business with you.
Chat GPT did say it’s wise to meet with a marketing specialist in your area to determine where best to spend your money. In our area, we work hard to know and understand our market so we can best guide our clients. We also have the Recommendation Engine which gives us access to nationwide data pool to know what similar businesses are spending money on nationwide. This gives you some interesting information, but you still have to make decision. The answer isn’t always black and white. Gather the best information you can, make your decisions and write them down.
Now, with your shortlist of channels in hand, it’s time for a test run. Run some advertising on your selected channels. Some of it will likely work better than others. Look for metrics such as engagement rate, conversion rate, or ROI (return on investment). Are your Instagram posts generating interest and prompting customers to visit your website? Is your email newsletter converting subscribers into paying customers? This feedback loop will guide your final decision on channel selection.
In Step 5, two weeks from now we will talk about how to analyze and adjust based on your results. Don’t be in a hurry with any of this. Take your time and make small adjustments as you go. Test two or three different ad styles and headlines to get the results you want. I have a friend who has been teaching himself Facebook advertising for his local business and he has really dug into the stats and analytics. He didn’t want to spend extra money having it managed so he is teaching himself. He has tested which ads are best and he has even had a few ads pulled by Facebook because he pushed the envelope too much, but he learned in each scenario. He told me in the last 3 weeks, he has earned $25k from his advertising on Facebook. That is awesome!
With the right channels chosen, we shift gears to discuss another pivotal aspect of marketing strategy: setting a budget. The magic number will be unique for every business, but a good starting point is typically between 5% and 10% of your total revenue. However, this isn't set in stone. New businesses seeking rapid growth might invest more, while established entities might spend less. Your budget should reflect your goals. Are you looking for aggressive expansion or steady growth? I believe a rapid growth business should invest 20% in paid advertising, with the hope that they will increase revenue while maintaining the same ad spend. Their percentage will decrease as they grow.
As with channel selection, your budget allocation isn’t a one-and-done decision. It requires consistent monitoring and adjustments. For instance, if your radio ads aren't generating as much traction as your social media campaigns, it might be time to re-allocate some funds. Flexibility is key here.
Budgeting isn't just about how much you spend, but where you spend it. Look back at your channel testing data. Are there areas where you're seeing high ROI? Those might deserve a larger slice of the budget pie. Alternatively, lower-performing channels might still be important for maintaining brand presence, but could make do with a smaller portion of funds.
Additionally, remember to allocate a portion of your budget to continue market research and data analysis. The market is a living, breathing entity, changing as consumer trends evolve. Think about the rise of TikTok. No one saw that coming, but it is now one of the most powerful product marketing tools in the world. You’ll want to stay ahead of these changes and adjust your strategy accordingly.
We've established that your channel selection should hinge on where your target audience spends their time, and your budget should align with your business goals and the channels that offer the best ROI. Through it all, ongoing data analysis is key to keep your strategy sharp and effective.
By now, you should have a roadmap to guide you through the sometimes overwhelming task of marketing channel selection and budget setting. If you need help, let us know. We are here to help you succeed.