Everyone knows that marketing is critical to the success of almost every business and company marketing departments are faced with major decisions each year regarding advertising budget allocation to insure it reaches a wide demographic. With the increase of online advertising methods, the question becomes how to allocate a budget using a marketing mix that will reach more potential customers. Unfortunately, budget allocation cannot be considered a one-size-fits-all proposition, but must be reviewed carefully using many different criteria, including product variety, marketing types, even locations within countries.
Online vs. Offline Marketing
One of the biggest questions asked by marketing departments is how much of the marketing mix should be in online advertising vs. offline advertising. Despite the increase in online promotions and the increasing popularity of internet advertising, many consumers still prefer purchasing items offline, although research has shown that as many as 65% of offline purchasers have researched their purchase online before entering the store. This indicates that a good marketing mix should include both online and offline advertising sources as part of their budget allocation.
Research also indicates that for many small to medium businesses, traditional advertising is still one of the best options for reaching a larger group of consumers. Many customers still find businesses through traditional sources such as Yellow Pages, direct mailings and newspaper advertising despite the increased popularity of internet sources. For this reason, it is important to continue including a portion of the advertising budget for traditional, offline sources as well as including some online sources for promotion as part of the marketing mix.
Although social media is normally free, requiring only that the company set up a page or account through a social media outlet, it is important to realize that upkeep of these sites is imperative for them to be successful as part of a marketing mix. In addition, some social media sites offer paid advertising as well, which can be included in a marketing budget. Because updating the sites takes time, the manpower costs should be included as part of any budget allocation as, depending on how extensive social media advertising will be, employee costs can become significant.
Developing a marketing budget is even more challenging now than it was in past years due to the increased use of the internet for product research. However, many studies indicate that although the internet is a valuable source for information, consumers still prefer traditional methods when it comes to locating a product.