Can you believe it is nearly 2018 and it is time to start budgeting for next year already? Online marketing is an important aspect of your business profile. As consumers are increasingly turning to online marketplaces, there has been a 20-year trend of increased online marketing spending across almost all business sectors. While marketing budgets remain consistent, online marketing spending continues to take up larger and larger proportions of that marketing budget. So, how much should you allocate to online marketing in 2018?
Looking forward to 2018, experts recommend that firms devote approximately 40% of their marketing budget to online pursuits such as search engine optimization (SEO), social media marketing, mobile marketing, digital marketing, and paid search marketing. That represents a 12% increase in online spending from just 4 years ago, which is not surprising considering the pace of technology and the reality that more and more consumers are using online methods for finding products, services, and businesses, and that’s not to mention the trends of increasing online shopping.
Similarly, marketing reports anticipate that online marketing spending will continue to grow over the next several years. Overall online marketing spending is expected to grow at an annual rate of more than 2% per year, reaching 45% by the year 2020. Broken down to reflect spending in each online marketing arena, expect your social media advertising budget to grow by a rate of 17% per year, ultimately reflecting a quarter of your online marketing budget by 2018. Digital marketing spending in the form of online video will grow at a rate of 11% per year, and paid search and display advertising will likely reflect about 40% of your online marketing spending by 2020.
Why such growth in online marketing? The answer is simple, online marketing gets the best results. And you shouldn’t be surprised to learn that the areas with the most projected growth, social media advertising and digital marketing, generate the best return on your investment. Still, it can be difficult to know how to focus that spending with so many social media and digital marketing avenues available. Marketing reports continue to support advertising with powerhouses such as Facebook (with 90% of social media users accessing the site) and Instagram. Of note, Instagram usage is expected to grow by 15% over the next 2 years, making it a powerful online marketing opportunity. On the other hand, sit such as Pinterest and Twitter are slowing in growth, so focus your efforts on Facebook and Instagram.
Clearly, growing evidence supports increased spending in online marketing, but this spending must be effectively focused. Working with a professional online marketing firm that can help you get the best return on your investment is the best way to harness the power of online marketing.