Supercharging your business’s growth through effective advertising is like igniting the afterburners on a high-performance jet. When done right, you skyrocket; でも, a miscalculation could result in a rapid descent.
That’s why landing on the perfect ad budget is crucial. But how do you define what’s ‘perfect’? It’s about aligning every cent spent with your business goals, and we’re here to be your mission control.
Why Your Ad Budget Matters
In a world where even the tiniest details can make or break a company’s ad game, grasping the decision-making that goes into every campaign is crucial.
Your ad budget is the financial backbone of your marketing efforts. Every dollar should be put to work effectively to give the best ROI, aka return on investment. It isn’t a number you pluck from thin air or borrow from the neighbors. It needs to be strategic, just like your advertising needs to be targeted.
でも, the critical question lingering in every business owner’s mind is, how do I know how much to spend for effective advertising?
Before Calculating Your Ad Budget
Figuring out how much to spend on ads is a matter of balance. You don’t want to waste money by overspending, nor do you want to be ineffective by underspending. There is a Goldilocks-like “just right” zone that will bring in results without affecting your margins.
Before we start, there are a few key terms you need to understand:
Markup is the difference between the cost of a product and its selling price (gross profit above cost). It is usually expressed as a percentage.
例えば, if you sell a product for $150 when it only costs you $100, your markup is 50%. You’ll want this figure for all your products individually and in your store.
Margin is your gross profit expressed as a percentage of the selling price.
In the above example, your profit would be $50. したがって, your total margin would be 33.3% ($50/$150).
Cost of occupancy is the cost of keeping your ecommerce store up and running (such as web hosting, 在庫管理, and shipping and handling). These costs are usually static and predictable.
You need these metrics before you can start calculating your ad budget. In a separate spreadsheet, make a note of these metrics.
You might have something like this:
| Margin | Markup | Cost of occupancy | |
| 製品 #1 | 33.33% | 50% | |
| 製品 #2 | 54.54% | 120% | |
| 製品 #3 | 37.5% | 60% | |
| Average for Store | 43.39% | 76% | $30.000 |
Once you have this data, you can start calculating your ad budget.
Calculating Your Ad Budget for Effective Advertising
How much you can spend on ads will depend on three things:
- 適所: 特定のニッチ市場の店舗は、利益率が高かったり、口コミやソーシャル メディアでのリーチが強かったりするため、広告費を抑えて済みます。. これは特にファッション店や非常にニッチな店に当てはまります。.
- ビジネスステージ: ブランドを確立するには、ビジネスの初期段階で広告に追加費用を費やす必要があります. 後期段階の企業は、最小限の支出で済む可能性があります。 3% 広告収入の年間収入のうち.
- 余白: 広告予算は通常、マージンに応じて決まります. マージンが高いほど, the more money you’ll spend on ads.
The US Small Business Administration advises allocating 7-8% of your gross revenue towards marketing and advertising if your annual sales are under $5 million and your net profit margin ranges between 10% に 12% post-expenses.
Understand that this also includes brand development costs, including spending on websites, ブログ, とソーシャルメディア. いつもの, you’ll have no more than 3-5% of your annual revenue to spend on advertising.
これを考慮して, let’s look at a step-by-step process for calculating your ad budget.
ステップ 1: Calculate Your Minimum and Maximum Possible Ad Budget
述べたように, most businesses allocate 5 に 10 percent of their annual revenue to advertising. ここに, 5 percent would be the floor and 10 percent the upper limit.
Start by calculating these lower and upper limits on your ad spend.
To do this:
- Take 5% と 10% of your projected annual sales
- Multiply each of these figures by the average markup per transaction.
例えば, suppose your business is projected to do $1M in annual sales this year. 5% と 10% of your annual sales would be $50,000 と $100,000.
Suppose your profit margin is 60%, つまり, you make $600,000 in profits with $400,000 in costs.
したがって, your markup would be 150% ($600,000/$400,000 * 100).
You have figures like this:
| Annual Sales (あ) | 5% of Sales (B) | 10% of Sales (C) | Markup (D) | 5% of Markup (B * D) | 10% of Markup (C * D) |
| $1,000,000 | $50,000 | $100,000 | 150% | $75,000 | $150,000 |
したがって, your minimum and maximum ad budget is $75,000 と $150,000.
ステップ 2: Calculate the Adjusted Ad Budget
The above is your “raw” budget since it doesn’t include your cost of occupancy (つまり, the cost of running the store).
To get your adjusted figure, simply deduct the cost of occupancy from the raw minimum and maximum budget.
例えば, suppose these are the annual costs associated with running the store:
- Ecommerce software: $2400
- Payment processor: 2% of annual sales ($20,000)
- ホスティング: $1200
したがって, your “cost of occupancy” is $23,600.
Your adjusted ad budget is as follows:
- Minimum: $51,400 ($75,000 – $23,600)
- Maximum: $126,400 ($150,000 – $23,600)
This figure tells you how much you can expect to spend on annual ads.
Pro tip: You can reduce your occupancy cost using a budget-friendly ecommerce platform like ライトスピードのエクウィッド. You’ll get a robust online store fully hosted and maintained by Ecwid, plus dozens of built-in business management and marketing tools to grow your business.
Best Practices for Effective Advertising and Budgeting
今, you have step-by-step instructions on how to calculate your ad budget. For best results, here are some best practices to keep in mind:
Start Small
If you’re just starting with advertising, it’s always better to start small and gradually increase your budget as you see results. It will help you avoid overspending and allow you to make adjustments along the way.
Set Clear Goals and Objectives
Before creating your ad budget, it is vital to identify your business goals and objectives. さもないと, it’ll be hard to evaluate the effectiveness of advertising.
Whether it’s to boost sales, increase website traffic, or elevate brand awareness, your objective should be crystal clear even before you boot up an Excel sheet.
Goals should be Specific, Measurable, Achievable, Relevant, and Time-bound. Known conveniently as S.M.A.R.T, these goals ensure your intent is as sharp as your execution should be.
Keeping your objectives and goals in mind will help you determine the types of ads you need to run and the platforms you should use. 例えば, if your goal is to increase brand awareness, ソーシャルメディア広告は従来の印刷物やテレビ広告よりも優れている可能性がある.
長期戦に向けて調整する. 迅速な勝利
広告の効果は最終的には、戦略が目標とどれだけ一致しているかにかかっています。.
目的が異なれば別の戦略が必要になる. 長期的なブランド構築の取り組みには、持続的なブランド構築が必要です。, 一貫した広告の存在感. 迅速な販売により、より派手な製品が求められる可能性があります, 短期的な広告キャンペーン.
広告プラットフォームを検討する
広告を掲載する場所は、その効果に大きな影響を与える可能性があります. Think about your target audience and where they spend their time online. It will help you choose the most appropriate platform for your ad campaign.
Consider using multiple platforms to reach a wider audience and increase the chances of success. 例えば, if your target audience is primarily young adults, social media platforms like Instagram and Snapchat may be better. 同時に, TV advertising effectiveness is likely to be low.
さらに, different ad platforms offer various types of targeting options. 例えば, Facebook と Google 広告を使用すると、特定の層をターゲットにできます, 興味のあること, 行動, と場所. 対象ユーザーを絞り込み、適切なユーザーに広告を確実に届けることができます。.
そう, 疑問に思っているなら, 「ソーシャルメディア広告は効果的ですか？」?「答えは間違いなくそうです」, 広告のターゲティングが適切である限り.
オンライン ストアで Ecwid by Lightspeed を使用する, Facebook や Google の広告を最適化するには、 クリックして. 広告を設定および自動化し、投資収益率を高めるために広告を最適化するのに役立ちます。.
広告データの追跡と分析
Keep track of your ads’ performance and use this data to make informed decisions about your budget. Adjust accordingly if certain ads or platforms don’t yield the desired results.
If you use Ecwid by Lightspeed, measuring advertising effectiveness is easy with the レポート tool. It has a Marketing section that helps track order sources, be it Google ads, Facebook広告, or other marketing channels.
要約
With these strategies in hand, figuring out an ad budget that meets your business goals and guarantees an excellent return on investment turns into a smart move, not a scary one.
Dealing with ad budgets isn’t just about finance but vision. It’s about translating the intangibles of advertising into actionable strategies that leave no room for interpretation — and every room for growth.
You’re not just calculating an ad budget; you’re architecting your path to market success. And with the strategies unearthed here, you’re set to craft an advertising budget that’s not just a figure on a sheet but the lifeblood of your most effective advertising.
Do you want to learn more about advertizing with Google?
- Intro to Advertising: Where to Begin When You’re a Beginner
- Google 広告 360: A Comprehensive Guide to Google Advertising
- Calculating Perfect Ad Budget To Match Your Business Goals
- Is Your E-Commerce Store Ready for Paid Ads? チェックリスト.
- 10 Quick Tips For Effective Mobile Ads
- オンライン ストア向けの Google Adwords: 9 お金を節約するためのヒント
- Google 広告のキラーキーワードリストを作成する方法
- Google 広告認定資格を取得する方法
- Google 広告を Search Console や Google アナリティクスとリンクする理由
