What Should You Spend On Content Marketing In 2019?
As 2018 whizzes past like a fastball, many marketers are starting to think about what the next year will look like. Given that 38 percent are expecting to increase the budget for content marketing, a fair number will be asking themselves how much of the marketing budget they should allocate to this part of the marketing mix.
The reality is that there’s no magic number. But there are definitely some established guidelines to help marketers calculate the investment they should be making, and this article lays them out, including:
A formula for calculating your content-marketing budget
The factors that may influence the decision to spend more (or less)
Tips for securing a bigger content-marketing budget in 2019
How does your content-marketing budget compare?
Content marketing can further many of the goals that are at the top of the list for marketers, including increasing brand awareness, enhancing visibility (especially on search), boosting the company’s reputation, generating leads, and supporting an increasingly “self-serve” buyer journey. (It can also reduce your marketing costs or overall costs per acquisition.)
But moving those dials requires a commitment of time and resources, and some marketers are underestimating the financial resources they need to support their goals.
What are other marketers spending?
According to the latest annual B2B content marketing survey conducted by CMI and MarketingProfs, the average content-marketing budget for North American B2B marketers is equal to 26 percent of the total marketing budget spend. If you’re allocating approximately one-quarter of your marketing dollars to content creation and distribution, you’re in line with the industry norm.
However, more budget correlates with more success: the marketers who see the greatest success with content marketing allocate 40 percent of their marketing budget to content, while the least successful spend 14 percent.
As for the marketing budget itself, the most recent CMO Spend Survey from Gartner found that the average marketing spend equaled 11.2 percent of the company’s revenue. That’s a blended figure that spans the full range of industries and company sizes and maturities, and as you’ll see in a moment, these factors—along with several others—can impact the budget decision.
It’s also worth noting that some successful organizations spend a significantly higher proportion of their revenues on marketing. Salesforce, for example, allocated 49 percent of revenue to sales and marketing in 2015, which returned 2.1 dollars in revenue for every marketing dollar spent as well as impressive year-over-year revenue growth.
How does your content marketing budget measure up?
Image Credit: Photo by patricia serna on Unsplash
Use this formula to calculate your content budget
If you want to work out a minimum, ballpark figure for your content-marketing spend in 2019, take your company’s revenue, multiply it by 11% to get an approximate marketing spend, and then multiply that number by 14% for the content marketing portion (this is the low end of the spectrum, remember). The resulting figure of 1.54% of total revenue, will give you a bare-bones, low-end estimate of the investment that companies across the full range of sectors and sizes are making.
(Revenue x 11%) x 14% = Content marketing budget
If your annual revenue is $10M, for example, your marketing budget should be approximately $1.1M, and the budget allocated to content marketing should be no less than $154,000 at the very lowest end.
Consider these factors to fine-tune the budget
Now that you have your ballpark figure worked out, it’s time for some fine-tuning. To bring more precision to your budgeting efforts, you may want to take some of these variables into account:
The CMI content-marketing survey showed that companies with the most sophisticated content-marketing processes allocate an average of 33 percent of the marketing budget to content, while companies with less experience allocate an average of 19 percent. This makes perfect sense when you consider that companies that have consistently invested in content for some time are more likely to have demonstrated a return on that investment, earned organizational buy-in, and perhaps even been able to attribute content-marketing efforts to earned revenue.
Conversely, if you’re just dipping your toes in the water, it may make sense for you to keep your investment small as you launch a pilot program, learn as you go, measure the impact, and use those metrics to gain buy-in and make the case for more budget.
Does your organization rely on an outbound or inbound process to generate leads? If you have an inbound sales process, content is likely to play a bigger role in the buyer journey, and you’ll need to produce more of it to attract, convince, and convert. That means you may need to increase your content-marketing budget to support these content-rich experiences.
On the other hand, if you are more reliant on outbound, high-touch, one-to-one sales activity, content marketing may not need to do as much of the heavy lifting or carry prospects as far down the funnel. That said, customer preferences are trending towards content-dependent self-service—even for complex B2B sales that carry big price tags. According to Forrester research, the average buyer progresses as much as 75 to 90 percent of the way through their journey before reaching out to a salesperson, which means their progress is guided entirely by content.
If your organization has plans for aggressive growth, you’ll need to invest more in your overall marketing budget. By the same token, if content marketing is an important part of the strategy, you will want to allocate a higher proportion of that budget to this part of the marketing mix. (Remember, the marketers with the highest-performing content allocated an average of 40% of the budget to content marketing.) Newer companies are more likely to need to invest more heavily in content marketing as a way to increase brand awareness and trust, while established companies have more brand equity to coast on.
This is a factor that isn’t always accounted for in budget calculations, but it’s important for marketers to know what kind of investment their competitors have made in content. A bigger budget doesn’t always translate into greater visibility and impact, but if your top three competitors are clearly outspending and outshining you, it’s time to allocate more resources to your content-marketing efforts. If your competitors are generating higher volumes of high-quality, relevant content, that’s likely to knock you out of the search results and inhibit your ability to reach prospects on other channels.
Win a bigger content budget with this ebook
It’s one thing to be able to calculate the budget you need for content marketing. It’s another thing entirely to convince the decision-makers to hand that money over to you.
If you need help building a rock-solid, irresistible case for a bigger content-marketing budget, download our latest ebook: Make the Case for Content Marketing: The Ultimate Fill-in-the-Blank Template for Convincing the Decision Makers and Getting More Budget. This step-by-step guide is designed to help marketers build a convincing, data-driven case that demonstrates the value of content marketing.