What you need to know to create a social media budget

Regardless of the size of the business you are in or if you're just a team of one, the social media interest has certainly been increased. Are you doing enough of the advertising? How much are you actually spending between all your subscriptions to tech stacks? Is any of the ads worth the investment? These are all great things to ask and you'll be helped by getting a social media budget outlined.

The guide is intended to help large as well as small businesses. No matter the size of your business or pocket, budgeting at its core fundamentals is still the same. When you begin to track these statistics, you will find it easier to determine whether to test new approaches and assess how well past ones still operate.

There are a lot of components that could fill your social media budget and we're going to go over each.

Why have a social media budget?

We find that 55 percent of social marketers list ROI as their biggest challenge. When you can't measure social media ROI correctly, then you'll have a tougher time justifying any investments. This refers to whether you want to invest in a new product by yourself or show that social media marketing works on the C-suite.

Budgeting helps you keep track of your costs, which are then included in the ROI estimates. So how is it that you start? Second, determine how to keep track of your budgeting. It can be with a paper spreadsheet, a worksheet you fill out at the start of the year, or even post-it notes you pass around.

First, you'll want to decide how you really want the budget to be handled.

• Modern budget: This is where you start with a sum of money and allocate sums to each division afterwards. Once a group is exhausted, there is nothing else you can do in it.
• Flexible budget: This is where another category will fulfill category depletion. Has one run out of money, and has another category to spare? Step beyond that.
• Zero budget: This is at the beginning of each budget planning process when you start each category with zero. You each the amounts per group, each time justifying the costs.

There are many, many ways to make marketing budgets. Some even take a lump sum, and subtract while you're working. This is not advisable if you have to track multiple components, because it makes it harder to see how well your budget is doing.

Goals are your budget’s foundation

Until you know what your social media goals are you won't know how to allocate your budget. For example, if you're hoping for more exposure to the brand, you could invest more heavily in paid ads that drive that, and less so in a pricey upgrade to software.

Look to the prior-year targets and budget projections to help you guide some of your target setting. Have you met them? What methods have yielded success? Would you like to raise capital to push new tactics or to extend previous ones?

The next thing to consider for a budget once you decide on goals is all the different parts that factor into one. Not every element we list can make sense for the budgeting of any organization, so take that into account as you start listing what you need.

Employees & training

Part of your marketing budget could include payroll and administrative expenses for the team. It can already be measured into the bottom line of the business. If that is the case, you should forget the portion of the payroll. For a small business it is an opportunity to have someone committed to marketing. They want to make sure you've recorded their payroll numbers in this region and any salary increases or bonuses.

Social media, as you probably know, is constantly changing. It takes time to keep a pulse on the industry and any new feature always needs time to learn. Since Stories was first released on Instagram, marketers needed to spend time trying to learn extensively how to use it on the site and how to incorporate it into their marketing plan. Many companies flat out ignored the feature until much later while others took the potential risk of diving into the format and checking out material.

The preparation will always be part of your budget, no matter how big your team is. If you're not studying or adapting to new features, you risk falling behind your opponents.

Content creation & production

Creation of content takes a considerable amount of time to produce. If you create it all in-house, or outsource it, it takes a lot of planning, time and money. If your marketing strategy calls for multiple posts a day like Benefit does, then you'll have to find out how to produce all the content you need. Your budget could be much higher in this region in comparison to someone else who just posts few days a week.

One way to mitigate the costs is by implementing a content strategy developed by the user. You will have plenty of material to choose from, and still be able to achieve your goals for publishing. Another idea is to repurpose the existing content over multiple channels and forms of media. Could you be editing a gif video? Or do quotes from an article turn into a graphic?

And don't miss out on post-production! It still takes time and money to do all that editing and graphic design. You don't want to waste your effort and expense in creating content just because you've overlooked the budget needed to edit and optimize it in the post-production to meet the quality brand expectations. Finally, if you're going on a paid content route, you're going to have to include the content development either here or in the general ads budget.

Software & subscriptions

Established expenses are those you renew monthly or annually. They provide subscriptions to management and analytics tools, or sites for customer service and email. In this region should be included whatever makes the marketing run smoothly. If you are planning this year's improvements or new software experiments, you might want to include some padding in the budget. If your social marketing reach is growing and you find that you need the added productivity of a new management method, you might want to use some of your budgeting process research to help develop a business case that will help you gain buy-in.

Advertising

Advertising is yet another large area of the budget. You'll need to know how much to provide for each channel for multi-channel enterprises. If Facebook is your biggest source, putting more money to that would make sense. The average cost per click for Facebook ads was $1.72 across all sectors but if you're in the fashion industry, it could be as small as $0.45 per click.

If you want to build up your Instagram audience further, then Instagram ads would be the way to go. Thankfully, both Instagram and Facebook ads can be handled from one spot, or even the same ad served on both platforms.

If you are just starting out on social media advertising, we advise you to first learn the basics and be open to experimenting with various platforms and different approaches to content. It takes time and money to test different approaches so you'll want to factor that into your advertising budget.

Paid partnerships

Influencer marketing strategies and brand alliances are on social media all over the place. They are successful in increasing the brand image and getting new consumers into the virtual door, but they do cost money to implement, depending in particular on the size of the audience of the influencer. This makes it even easier to see how well a relationship is doing with the introduction of paying partner tags on different platforms.