5 Points for Building an Online Ad Budget

As we close in on the last quarter of 2011, many of us are preparing our 2012 budgets. This is the time when we all review our online efforts and re-allocate existing resources (money and other resources) to generate a better return on investment.   Online advertising faces a double-edged sword. 

It provides incredible detail on statistics such as email open rates, website traffic, click-through rates, Facebook likes and more.  Yet this granular level of reporting generates increased scrutiny.   Compound this with a lack of benchmark data in our industry, and it is difficult to manage expectations or gauge program success.

Yet there is no denying that online technology can help a company not only reach new customers but also build stronger relationships with existing customers and reduce operational costs.  As you review your 2011 online budget and plan for next year, consider the following:

1)      Make sure messaging to a given target is consistent across print, online and sales. Multichannel buyers (those who purchase from you online, via direct mail and in person at a showroom or store) consistently spend more. According to the Abacus's Multi-channel Trend Report, multi-channel buyers represent 69% of the revenue and spend nearly twice the amount of other repeat buyers.

2)      Don't dismiss tactics you've tried before. Technology and adoption of various technology platforms happens so fast that what wasn't successful a year ago may be worth a second try today. For example, with 50% of cell phone users expected to own smartphones by the end of 2011, this may be the ideal time to re-try tactics such as QR tags or social media. 

3)      Set aside a small percentage of your advertising budget to experiment with new tactics. According to Jim Sterne, founder of the eMetrics Marketing Summit and an internationally known authority on metrics, "Testing is an act of creativity that is even more fun than the Super Bowl... An expenditure of 10 percent of your marketing budget on wild experimentation is not guaranteed to produce breakthrough results, open up new markets, launch new product lines, or reshape your entire brand as leading edge thinkers. But not spending on experimentation is guaranteed to not produce any of the above. Think of it as marketing R&D -- just don't forget to keep clear goals in mind."

4)      The database is king.  Be sure to include in your plan efforts to increase the size and customer/prospect information in your house files. Consider appending existing customer data records with new information that can improve your marketing efforts in the new era of one-to-one marketing.

5)      Don't base results purely on the last exposure before  purchase. Regardless of new technologies, the customer buying process is the same: trigger, consider, search and choose before he/she will buy.  Advertising tactics that build brand are important to ensure your company is included in the "consideration" step.  Data from comScore's " Whither the Click?" provided proof that view-through exposure to display ad campaigns - even in the absence of a click - drove lifts in customer behavior, including website visitation, trademark searches, online sales and offline sales.

These are my five key points to consider when reviewing and building your budget. What do you consider when reviewing and preparing your marketing budget?