Two Trends That Eat Your Digital Marketing Budget

10. November 2016 by Stephan Nobs | 0 comments

what_the_hell_cartoon_blog“Past performance does not guarantee future results.”

If you have ever bought shares of stock, bonds, or shares in a mutual fund, you were presented with the above disclaimer.

For Digital Marketing you could say that the results you achieved with your budget in the past are unlikely to be achieved again in the future. Digital Marketing costs are subject to serious inflation. You need to have more budget today to achieve the same results as last year.

Remember the days when digital marketing was cheap? Well, those days are gone. Together with your Blackberry.


Everyone is going Digital

Budgets for digital marketing keep rising year over year. The consensus is that Digital marketing is still good value for money. If you are a wise marketer, you happily shift part of your budget to digital to improve your overall marketing ROI.

This has been the case for the last 10 years, and it will probably be like this for years to come. However, if you have been in digital marketing for a while, you have seen a significant change in costs.

You requested more budget this year, not only because you want to. You requested it because you have to. That is if you want to at least equal last year’s results.

The digital space is getting crowded

To be digitally successful, you need to be louder and smarter than the competition, however loud and smart the competition already is at any given time. And it comes with a price tag.

Here are just 3 examples to show you the massive price increase of the digital media space over the past 3 years:

•    The minimum bid for Cost-per-Click (CPC) advertising rose by as much as 300% from March 2013 to June 2015.
•    The average Cost-per-Click (CPC) increased 157% from 2012 to 2015.
•    The average Cost per Conversion increased from $13.14 in 2010 to $30.25 in 2014.

And these are just 3 examples from the relatively short term.

Two trends, one outcome. More budget please!

There are 2 major long-term trends in contradicting directions that reinforce the need for more digital budget.

Trend #1 – Effectiveness is going down
The always-connected consumer is facing more of your competitors, through an increasing number of channels in an ever-growing list of niche markets. Effectiveness per digital marketing activity is going down, so you need to be in more different places to be able to compete. Which brings us to the second trend, how do you manage all this?

Trend #2 – Complexity is going up
The easy road to effectiveness has become a network of narrow streets you carefully need to navigate to get the job done. The bidding war on the limited digital media space caused a higher need for specialized skills. The niche markets demand specialized and supremely relevant content, all of which needs to be produced and coordinated.

The promise of easier customer reach and a cheaper way for business growth via digital marketing is rapidly vanishing. If something is cheap and easy, it won’t stay that way for long.

Beat the trend
If the effectiveness per single digital marketing activity is going down, and the effort required to convert a single customer is going up, then you’d better come up with a plan to beat the trend.

  • Step one is to monitor, fine tune and adjust digital marketing spend and content to ensure lowest Cost per Conversion.
  • Step two is to look for ways to bring prospects from your paid media efforts to other, cheaper forms of customer engagement as early in the process as possible. Fill up the top of your funnel with relatively expensive specialized content (as indicated in step one) and pull them through the rest of the funnel using more cost effective methods.

Besides the technology and data part, you should not underestimate the importance of your content strategy. If you have not checked out our Customer Engagement Matrix [] yet, you definitely should. It has proven to be an invaluable approach for marketers who are facing ever rising digital marketing costs. It’s time to escape the rat race and take back control. Even if you are not using one of the BrandMaker tools, this matrix will deliver instant value.
Beating trends can be very hard. Competitive advantages usually can’t be picked off the shelf. But this time, it can. It is as simple as using the Customer Engagement Matrix.



Hochman Consultants



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