CREATING A DIGITAL ACTION PLAN

BUDGETS
Lecture 8
Setting budgets for digital marketing
Marketers must consider investment in the following areas:
• User experience – website design, mobile, apps, social
media presence
• Attraction - visitor acquisition cost and visitor growth
• Conversion –conversion rate, revenue per customer
• Retention – cost of repeat customers, revenue per repeat
customer, repeat customer churn rate (customers that don’t
return), repeat customer conversion rate.
 488.3
Total Market
2019mil EUR 550.4

Digital marketing budgets

Total Market
2018 mil EUR Television 357.6
Television 319.6 Outdoor 48.1
Outdoor 44 Magazines 15.3
Magazines 15.7 Newspapers 5.4
Newspapers 5.6
MEDIA INVESTMENT SHARE Radio
Internet
29.8
71.2
Radio
Internet
33.3
88.2

Cinema 2.4 Cinema 2.6

TV Radio Magazines Newspapers Cinema Digital OOH

65% 65% 65% 65% 65% 65%

67% 64% 64% 65%

7% 6% 6% 6% 6% 6% 6% 6%
7% 6%
5% 5% 5% 4% 4% 3% 3%
6% 6% 2% 2% 1% 1% 1%
6% 3% 2% 2% 2%
3% 12% 12% 13% 14% 15% 16%
7% 10% 11% 13%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019E

Source of estimations: Advertising spend databases (BRAT, Kantar Media), Media Suppliers, Sales Policies
Suppliers
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 est
 Approaches to budgeting
Financial approach Marketing approach

• Affordability: budget is based on what • Objective and task: what it wants

the business can afford after fixed and to accomplish and then how much
variable costs have been calculated. this will cost.
• Competitor parity: budget based on
estimates of competitor expenditure
with the aim to match or exceed.
• Percentage of sales: budget based on
% of sales revenue expected
• Arbitrary: budget is based on a
arbitrary amount
Eg. of approach budgets in E-commerce
– financial year budget plan
• Marketing budget – Percentage of sales (can vary
between 5% for established brands – 15% for new
brands)
• 7% of sales – adjusted each month based on sales

• Split between
• Media 65%
• Performance budget (Search Engine Marketing: PPC & SEO)
• Digital non performance (Display, Social media)
• Non digital (TV, Radio, OOH, Press)
• PR & events: 8-10%
• Direct Marketing: 5%
• Research 5%
• Production 15%
Eg. of approach budgets in banking -
financial year budget plan
• Marketing budget – Arbitrary based on management decision
• Yearly amount as per management or group decision;
• Adjusted quarterly
Split between
• Masterbrand – brand investment
• PR & events & CSR
• Research
• Business services/ products
• Production
• Media offline
• Digital media (all) 25% of all media
 Budgets approach per campaign -
selecting the best media mix
• Who are we addressing – which target or targets are most important
and what media do they consume and how
• How many of those targets need to be reached – Reach
• How many times do we need to reach them – Frequency
• Where and When should the advertising be done

Chaffey, and Ellis-Chadwick, 2012

Budget allocation per media plan- eg.
 Budgets approach per campaign -
selecting the best (digital) media mix
• When selecting mix of digital media, marketers will determine the most
appropriate based on previous experience of campaigns as well as input
from agency partners.
• Many digital marketing failures have resulted in poor control of media
spending
• The digital media mix should be optimised to minimise the cost of
acquisition

Chaffey, and Ellis-Chadwick, 2012

 Budgets approach per campaign - selecting
the best digital media mix – ATTRIBUTION
• A customer will rarely go straight to a site and purchase – or perform a
single search and then buy
• It is important to recognise the value of different digital and traditional
media when selecting and scheduling their digital media mix
Budgets approach per campaign - selecting
the best digital media mix – ATTRIBUTION

Watch this video which explains the basics of attribution:

https://www.youtube.com/watch?v=tMSFd1QyhCw
 Develop an action plan: Scheduling
Jan Feb Mar Apr May Jun Jul Aug Budget
Eur

Website re-launch

Pay Per Click

Campaign

Email Campaign

Display Advertising

Mobile display
campaign

Affiliate programme

Facebook Ad campaign

Launch of mobile app

A simple chart can be used to highlight the schedule of the various activities of the
digital marketing plan
Planning and budgeting resources

• An organisation will need to decide on how to effectively

resource the digital marketing plan in terms of personnel.
• Finding resources to implement the digital marketing plan
should consider current staffing, skills required, skills and staff
availability.
 Digital supplier options

• Full-service digital agency – expertise in core digital

media channels, display advertising, website design and
build
• Specialist digital agency – typical specialisms include;
strategy and planning, website design and build, online ad
buying, SEO and PPC, mobile marketing, social media, PR
etc.
• Traditional agency – not digital specific, can be full service
or can provide specialisms
• In-house resource – using internal resource to plan and
execute digital marketing plans and campaigns
CREATING A DIGITAL ACTION PLAN
SETTING METRICS, KPIS AND OBJECTIVES
Lecture 9
 Metrics & Key Performance Indicators
METRICS are “a quantitative measurement of statistics
describing events or trends.” (Kaushik, 2010).
A metric is a measurement you record to track some aspect of
your activity and measure the success or failure of the
performance of that activity.

KPIs (Key performance indicators) are “metrics used to

assess the performance of a process or whether goals are
achieved.” (Kaushik, 2010). KPIs relate to a specific strategic
business goal and reflect how successful the business is in
achieving that goal.
KPIs are strategic and metrics are tactical. KPIs define a set of
values against which the metrics are measured.
Basic website KPIs

• There are some basic website KPIs used for measuring

web traffic and digital campaigns.
• Visits/Unique visits = a person who visits a site at least
once within the reporting period
• Bounce rate =the percentage of visitors who navigate
away from the site after viewing only one page.
• Page views & Page/Visit = is a visit to a page on the
website
• Average time on site
• Percentage of new visits
• Conversion rate
• Cost per conversion
Online terms
• CTR (click through rate) is the number of clicks that your
ad receives divided by the number of times your ad is
shown: clicks ÷ impressions = CTR. For example, if you
had 5 clicks and 100 impressions, then your CTR would
be 5%. Each of your ads and keywords have their own
CTRs that you can see listed in your account.
• Quality Score is an estimate of the quality of your ads,
keywords, and landing pages. Higher quality ads can lead
to lower prices and better ad positions. The Quality Score
is reported on a 1-10 scale and includes expected click
through rate, ad relevance, and landing page experience.
The more relevant your ads and landing pages are to the
user, the more likely it is that you'll see higher Quality
Scores.
Online terms
• Bounce rate: the percentage of visitors who navigate
away from the site after viewing only one page.
• CPC= cost per click
• Cost per acquisition= cost per lead or cost per item sold
or cost per conversion
• Conversion rate
Analytics in real Life: the Online Checkout

• Check this video: https://www.youtube.com/watch?

v=3Sk7cOqB9Dk
Measuring digital marketing activities

Measures used for setting digital marketing objectives or

assessing success
1. Unique visitors (reach%)
2. Conversion rate
3. Cost per click (CPC)
4. Cost per acquisition (CPA)
5. Campaign ROI
6. Brand metrics
7. Lifetime value
AIDA model – measuring conversions
 Paid media - Key Performance Indicators

Awareness Interest Desire & Action

• Visits • Unique visitors • Clicks
Paid Search • Unique visitors • Time spent on • Click through
Display Ads • Time spent on site site rate
Affiliate
Marketing
• Reach • Clicks • Conversion rate
• No. of impressions • Click through
• Advertising rate
awareness
• Advertising
recognition
 Owned media - Key Performance Indicators

Awareness Interest Desire Action

Website • Visits • Repeat visitors • Average • Click through
Blogs • First time • Average length length of rate
Mobile apps
Social
visitors vs of visits visits • Conversion
presence repeat visitors • Average no of • Average no rate
• Referral visits per visitor of visits per • Purchase
(online vs • Average page visitor intent
offline) views per visit • Bounce rate
• Most viewed • Change of
pages opinion
about a
brand
 Earned media - Key Performance Indicators
Awareness Interest Desire Action
Publishers/ • Brand • Brand • Measurement • Measurement
Editorials mentions on mentions on of sentiment of sentiment
Influencer
outreach
social media social media (positive, (positive,
Word-of- • No of fans • No of fans negative, negative,
mouth • Brand • Brand neutral) neutral)
Social searches searches
networks within engines within engines
• Engagement
 Search marketing
• Search marketing, also known as search engine marketing or SEM, is a type of
online marketing strategy that promotes websites by increasing their rankings and
visibility on search engines like Google, Yahoo. Search marketing employs both paid
and unpaid (organic) tactics to help Internet users find the right website among
millions.
• Paid search marketing tactics include PPC (pay-per-click) listings, contextual
advertisements, and paid inclusions. Pay-per-click it’s based on keywords. PPC
results show up in advertisement boxes on Google. Companies pay to be
represented by specific keywords, and owe money each time a user clicks on one
of these ‘sponsored’ links.
• Search engine optimization, SEO, is one of the most critical parts of search
marketing, encompassing keyword adjustments, content optimization. An effective
SEO campaign can position an e-commerce site to rise to the top of the Google
rankings. It works organically (meaning that a marketing firm doesn’t have to pay
for it).
Measuring search activity
PPC (Paid by Click)
Quality Score
Bounce Rate
Click-through Rate
Cost per click (CPC)
Cost per conversion/acquisition
Conversion rate

SEO
• Traffic volume (from organic search)
• Traffic quality (i.e. bounce rate)
• Onsite behavior (i.e. time spent on pages/site)
• Conversion rate
• Rankings (Rankings in SEO refers to a website's position in
the search engine results page. )
 Measuring social media
Key social media measures organizations are interested in:
• Distribution - what social media channels are being used, how can people
reach the organization?
• Fans, followers, mentions, blog subscribers, social bookmarks
• Interaction - how likely are followers going to engage, spread the message
and interact with each other?
• Social shares, comments, reviews, likes or ratings,
• Influence - how do attitudes change due to the social media activities?
• Share of conversation, satisfaction, sentiment (positive, neutral, negative)
• Action and ROI – sales and other real world actions from social media
• Conversions, revenue, sales, transaction value per customer
Measuring social media
– sentiment analysis
• Sentiment analysis looks at comments and suggestions
left on social media sites such as blogs and social
networks.
• Instead of analysing just words, it identifies attitudes
towards a brand by using variables such as context, tone
and emotion, among others.
Measuring social media -analyzing Share of
Voice (SOV)
• In social media, share of voice refers to the number of
conversations about a brand vs. its competitors.
• To measure share of voice in social media amongst
several competing brands, an organization would
compare the number of articles, posts, tweets, videos or
images where its brand and competitors are mentioned.
Measuring E-mail marketing
• Open rate – no of Newsletters opened
• Click rate – no of clicks to website from NL
• Conversion rate -
Monitoring and measurement Tools
Channel Tool
Email Marketing Email Service platforms
Affiliate marketing Affiliate networks, affiliate
discovery tools
Website or landing pages Analytics platforms
Social media Analytics and monitoring
platforms: Hootsuite, Social
Bakers, Facebook/
Instagram Insights
Online PR Mention, Simply measured
SEM – search engine Adwords, Analytics (google
marketing analytics)
Tracking the online impact of offline
campaigns
Marketers can also measure the online impact of any offline campaigns
that use traditional media, such as TV, radio, outdoor etc. Organizations
can measure this impact through:
• Using vanity or campaign URLs within offline ads
• Using redeemable coupons or voucher codes within offline ads
• Use online surveys and market research to ask how the customer
heard of the organization during the check out process
• Correlate website traffic with offline ad times
• Measure the volume of direct traffic/ organic traffic to site.
Group exercise
• Choose one organization you work for / you know and
evaluate the KPIs currently used to analyse and measure
its social media activities.
• What other KPIs might be useful for them to track to
further evaluate the success of their social media
activities?
Bibliography
• Chaffey, D and Ellis-Chadwick, F (2012) “Digital Marketing: Strategy, Implementation and Practice”,
Fifth Edition, Prentice Hall.
• Econsultancy (2014). Infographic: Marketing Budgets 2014. [ONLINE] Available at: https://
econsultancy.com/reports/infographic-marketing-budgets-2014 . [Last Accessed 26 May 2014].
• Fishkin, R (2013). The T-Shaped Web Marketer. [ONLINE] Available at: http://moz.com/rand/the-t-
shaped-web-marketer/ . [Last Accessed 26 May 2014].
• www.smartinsights.com