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Estimating Marketing Expenses

by tbk125
8 replies
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Im working on outlining cost components of running a retail website for the business I work at. My question is what do you believe to be a reasonable web marketing budget for a small to meadium sized business? I appreciate any help
#estimating #expenses #marketing
  • Profile picture of the author wakeforce139
    Figure out your keywords, use the adwords tool to build out campaigns. See what it's estimating your cost to be running full speed. Make sure you use negatives so that you aren't bidding on terms that aren't relevant and make sure you play with exact match vs broad terms. That will guide your PPC budget, and then figure out which CSEs and marketplaces it makes sense for you to compete in. Get their costs. Nail it
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  • Profile picture of the author OliverTrent
    There's not really a good answer I'm afraid. A lot of it comes down to how much it costs to reach positive ROI, and a lot of that can depend on the person running your campaigns, your product, your competition, even the time of year!

    I get asked that question by clients a lot, and I usually ask them what they can afford to lose. Good marketing shouldn't lose you anything, at least eventually. You just have to prepare people for the fact that there will be bad months as well as good!
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    • Profile picture of the author OnlineStoreHelp
      So I am curious your definition of Web Marketing, do you include the costs of running the cart or just the marketing side of it? The cost of running the cart runs the gammit depending on how many products, categories, options/variants, what functionality you need, etc.

      If you are just talking about marketing, what channels are you going to run with? PPC, Email, Social Media?

      Email Marketing: $0 - $99 a month depending on what system you use, etc.
      Social Media Marketing - $10 - $99 a month depending what type of promotions you want to run, and tools.

      PPC - Google Adwords, Facebook Ads, promoted tweets, Stumbles, etc. What is our budget, I wouldn't do less than $150 a month even just starting out and testing. Once you get a sense of the ROI you can tweek and refine.

      When you give very vague questions you get very vague answers. None of this includes paying for implementation, graphics, product samples, etc. Never underestimate building your online business via physical means (gift expo's, etc.)
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  • Profile picture of the author tbk125
    I apologize my question was vague, what I was referring to was PPC campaigns, CSE listings, things of that nature.
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  • Profile picture of the author teeds01
    I think $150 a month is too little unless your CPC is way under $1.00 (which for ecommerce it rarely is unless your selling "botanical green jelly underwear" that has a high search history and can't be found anywhere else.)
    The first question I would ask is what's the value of your organic traffic - do you have hits now?
    How many sales do you need per day? Based on a 1.2% full funnel conversion (realisitically very high for a brand new site) you would need at least 100 hits a day.
    The biggest problem we hit is there's just not enough traffic because the owner's don't want to allocate more to Adwords.
    I would start high on Adwords (5 sales a day = 500 + hits) - make sure you start off with email campaigns from day one - then plan a good organic strategy to increase sales over time if it's brand new. Confusing answer?
    Take your cpc based on your account and multiply it by 100 (best case scenario) x number of sales desired per day. Hope that helps.
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    • Profile picture of the author OnlineStoreHelp
      Originally Posted by teeds01 View Post

      I think $150 a month is too little unless your CPC is way under $1.00 (which for ecommerce it rarely is unless your selling "botanical green jelly underwear" that has a high search history and can't be found anywhere else.)
      The first question I would ask is what's the value of your organic traffic - do you have hits now?
      How many sales do you need per day? Based on a 1.2% full funnel conversion (realisitically very high for a brand new site) you would need at least 100 hits a day.
      The biggest problem we hit is there's just not enough traffic because the owner's don't want to allocate more to Adwords.
      I would start high on Adwords (5 sales a day = 500 + hits) - make sure you start off with email campaigns from day one - then plan a good organic strategy to increase sales over time if it's brand new. Confusing answer?
      Take your cpc based on your account and multiply it by 100 (best case scenario) x number of sales desired per day. Hope that helps.
      If you are doing long tail words and/or google product search you shouldn't be anywhere near $1.00 unless it is an ultra, ultra competitive niche. Add on top of that, its a great way to ease into CPC and test. No sense spending $1,000/ month until you understand what works for you. I have a client who has a 500/month budget and is running around 3000 clicks per month (just adwords, not product search) in a competitive market. His CPC is between .23 and .27.
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      Learn how to set up a powerful, functional yet easy to use e-commerce website at cartprep.com.

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      • Profile picture of the author teeds01
        I think we need more info to answer the question correctly - specific to product and site. I advise my clients to start high and decrease to find efficacy - but we also apply A/B and multivariate testing in 1-2 week cycles to seek best conversion. We do heat mapping at times. I have clients that have .17 cpc with long tails and high traffic but their CPA is traditionally low not due to their adwords but due to their entire marketing model (email, confidence factors, etc.) I'm not saying that low cpc doesn't work but the point of adwords on ecommerce is to predict your growth not guess it. Long tail keywords are not silver bullets. More traffic isn't a silver bullet for every ecommerce model either; however if you are learning your sites conversion you need statistically consequential traffic. My "personal" opinion is to overestimate your budget, set up google analytics correctly from day one and track it, if you have too much traffic and your ROI is better - great you have more sales and you can decrease in month 2. Traffic does not equal sales, clicks do not equal sales, and sales equal sales only after the charge back period has expired.
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