Digital marketing for manufacturers hasn't changed a ton over the past few years, but it's possible that you are neglecting some of the important aspects that can help you increase your bottom line. Has the phone started ringing less than it used to? Are the forms on your website not getting filled out as regularly as you’d like? Are the quality of the leads you’re getting not up to par? If you’ve been putting off investment in digital marketing, you are not alone. Research conducted by the 2018 CMO Survey shows that the average industry spends around 6.9% of their annual revenue in their marketing budget, while the manufacturing industry only spends about 2.7% (1).
What does this mean for your manufacturing business? It means that manufacturers who invest in digital marketing are now poised to leap ahead of their competitors who don’t invest in these revenue generators. With social distancing likely to stay with us for some time, businesses turn to digital self-service and remote sales reps to seek new suppliers or decide to reorder (2). Digital marketing offers unprecedented opportunities to reach quality customers and leads that are more targeted and efficient than ever before.
If you have been spending the same amount year after year, or declining spend, now is the best time to start reinvestigating where you spend your budget. One of the most important aspects to keep in mind during this process is your company's return on investment (ROI). Just like any other investment, you should expect a profitable return on your marketing expenditures. The revenue to marketing cost ratio represents how much money is made for every dollar spent in marketing efforts. For example, if your company makes five dollars in sales for every one dollar spent on marketing, you would have a 5:1 ratio of revenue to cost. A 5:1 ratio is average for a manufacturing company. Anything below 5:1 is considered a low ratio, and anything above it is deemed to be strong (3).
The Importance of a Marketing Budget and How Much it Should Be
Buyers are going to online sources to review companies and research the best fit for their needs. If your company does not have an online marketing presence, it could miss out on potential sales.
Every manufacturing company will have a different marketing budget, and it is hard to put an exact number on what it should be. Many factors go into deciding a marketing budget, including:
The Size of Your Company - Your marketing budget can vary greatly depending on if you are a small local company or a large international company.
Your Target Market - Always keep in mind your target audience. Is your audience more likely to respond to an email blast or a Facebook ad?
Previous Year’s Numbers - Review your company's previous marketing budget and make adjustments where you see fit.
Type of Advertising Used - Marketing costs can vary depending on the type of advertising you choose to utilize.
Your Marketing Timeline - Plan out a timeline. How often do you want to release ads and what time during the year will you advertise the most?
Your company goal - Keep in mind your company goals, and how much marketing could play a part in reaching those goals.
Finding the digital marketing budget that works for your company can take time, but the payoff can be exponential in your final marketing ROI. Without digital marketing, your company can go unnoticed and overlooked compared to competitors with a healthy digital marketing budget. Get ahead of your competitors with a marketing plan that shows results.
Digital Marketing Strategies your Company Can Use
With a healthy marketing budget, there are a variety of online marketing strategies your company can utilize, including:
- User-Friendly Website: having a user-friendly website is essential to making online sales. No matter how good your website looks, if a consumer cannot easily navigate it, it could result in a loss of a sale.
- Pay-Per-Click Ads: Pay-Per-Click is an online advertising model in which advertisers pay every time someone clicks on one of the company’s digital ads.
- Email Blasts: Send out frequent emails updating your consumers/potential consumers on your products, current promotions, or exciting company news.
- Social Media Ads: placing ads on social media platforms such as Facebook or Instagram, can be a great way to reach a wide variety of potential consumers.
- Search Engine Optimization (SEO): the goal of SEO is to drive more traffic to your website organically through a search engine such as Google. This can be done by improving the quality of your website and the content.
- Live Chat: enabling a live chat service on your website will give your customers a safe option to communicate with your sales team.
- Photography and Videography: research shows that including high quality images with your content increases engagement and makes your products memorable.
Digital Marketing is Results-Driven
If you’ve ever questioned whether the money you spent on traditional marketing in the past was worth your investment, then welcome to the future! ROI is ultimately about giving you and your business stakeholders the tools and information you need to be confident that your marketing dollars are pulling their weight. Through metrics like search engine rankings, Google Analytics, and click through rates you will know exactly what effect your digital marketing plan has on your business growth.
It can be a trial-and-error process to figure out the type of online marketing that is best for your company and will result in an appropriate ROI, but it is essential in the overall success of your business. The world is shifting, and word-of-mouth sales are not going to cut it anymore. In 2021 and beyond, consumers turn to the internet to retrieve information about companies and conduct their shopping. Don’t be left behind; join the digital marketing world and get your brand and products in front of millions of potential customers.
If you’re interested in getting a sense of where to begin with your company’s budget, reach out to Werkbot Studio’s business development team, who can help you put together an appropriate budget based on your business’s goals, size, location, and competition.