Considerations For Digital Marketing Budgets in 2023

It's that time of the year again. For marketers, this means reviewing successes from the year and determining where to focus efforts next year. This year we are facing economic uncertainty--hello possible recession--which makes it even more important to set your 2023 budget now.

But it's often difficult to estimate budgets for marketing activities that you may be doing for the first time, like paid advertising (or increasing your paid advertising spend). 

So, what are your marketing goals for 2023? More qualified leads? Better follow-up or nurturing leads to get more in the sales process? A better customer retention strategy? Increased sales?

Whatever your goals are, your company website should factor in as an important tool in helping you reach them. A results-driven website must align with your overall strategy. This means allocating time and budget specifically to developing your online presence.

The question then is - what should your digital marketing budget allocation be in 2023?

In this article, we explore that topic as well as trends that are affecting digital marketing in the future.

First, Identify Business Goals

Before you decide what kind of marketing activities you should be doing, it's best to start with a business analysis. A business analysis helps you identify your goals from a revenue standpoint. By knowing your projected revenue for 2023, you can set lead and customer goals.

By looking at revenue, lead and customer goals, you can then determine where your focus should be from a marketing standpoint.

Now let's take a look at some considerations for your marketing strategy for 2023.

Consumers' time online has jumped

During lockdowns that occurred during the pandemic, your customers got in the habit of using the Internet to buy and perform research. This has caused many companies to reevaluate priorities in terms of their digital presence even once in-person work, shopping, and socializing resumed.

You've probably heard the term "digital transformation." One component of digital transformation is shoring up your online presence so customers can find your company easier and find out more information about your products and services.

As companies cut back to try to get more out of their marketing, paid search and social were the only two digital marketing channels with positive growth rates during the pandemic. As things opened up more towards the end of 2021 and throughout 2022, businesses are paying more attention to the user experience of their digital platform.

Companies Judge Digital Marketing Effectiveness By Number of Leads Generated

Not unlike years past, companies are evaluating their digital marketing efforts based on the number of leads that those marketing tactics generate, according to a June 2021 survey.

First, businesses are spending more time trying to understand and track their results. This means more companies are seeking platforms for reporting and analytics that give them business insight.

Second, companies are expecting their marketing tactics to generate business value, not just build brand awareness.

Digital ad spending is increasing, with no end in sight

Digital ad spending has been increasing steadily, and is expected to do so at least through 2024. This means increased competition in search engine advertising and higher media spend fees.

Optimization is becoming more important in order to get cost per click fees down as low as possible to offset the higher cost for clicks.

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Analytics, Data and Measuring ROI is a Priority

Companies -- even small ones -- have an increasing number of platforms in their revenue operations ecosystem. Extracting meaningful data that can be used to make business decisions is a significant challenge.

While there are several significant challenges measuring marketing effectiveness, difficulty integrating data from different sources and software platforms remains among the most challenging.

One trend we see in the marketing and sales technology world is the combination of tools like email marketing, social media management and CRM in order to aggregate data more easily and provide business insights. Perhaps this is why 67% of marketers replaced their marketing technology software tool in the past year.

Improving Website User Experience is a Must for Search Engine Optimization

Every few years, Google rocks our world with something new. In 2021 and beyond, it's Core Web Vitals. This new algorithm change has companies scrambling to improve the user experience of their websites, as Google places more emphasis on this for rankings. In 2022 to 2023 Google's new Google Analytics 4 and its event tracking has the marketing world abuzz. 

If you haven't heard about Core Web Vitals, you're not alone. 60% of marketers haven't heard about core web vitals. This makes optimizing your site for core web vitals a competitive priority so your company is not the last to figure it out. 

Content Marketing strategy that Focuses on Improving Existing Content

While the amount of content on the web, and certainly in your industry, is steadily increasing, so is the demand for content. Content can take the form of video, podcasts, blog posts, articles, e-books, white papers, etc.

While companies struggle with creating enough content to generate new business, many companies are investing in improving existing content.

Regardless of what content businesses have created over the years, it's important to analyze existing content and improve or update contact that might be out of date or not optimized. 

First-Party Data Gains Importance

As Google phases out third-party cookies, it becomes increasingly important for companies to collect their own information and data on customers and prospects. While Google has delayed phasing out third-party cookies in Google Chrome until 2023, privacy and data security are top priorities.

More Automation to do More With Less

In order to do more with less and for sales and marketing teams to become more efficient, many companies are turning to automation. Below, you will find a chart from 2021 that shows what functions companies are currently automating.

HubSpot published an article recently on seven ways to automate your business. This article is a good reference for businesses that need ideas for how to incorporate automation in their sales and marketing strategies.

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Make Better Use of Your CRM

For starters, your B2B website should be connected to a CRM that can not only track customer interactions but can also store prospect behavior.

For example, your marketing and sales teams need to be able to see not only contact information for your opportunities, but also what pages on your website they visit, where the prospect found your company website, what emails they open, what content they download, and what forms they fill out.

Your CRM should also be able to identify companies that visit your website, giving your business development team a warm lead list. You can sort through these lists and identify companies that are good targets, then find the right people at those companies to connect with.

Conversion Rate Optimization

Conversion Rate Optimization, or CRO ensures that you get the most out of your marketing efforts and your website.

Follow our four steps to CRO:

1. Examine: Develop insights based on business goals and market research.
2. Implement: Create a data-driven CRO strategy with a written plan.
3. Test: Make changes to your website, then measure the results to a baseline.
4. Verify: Make sure the change makes sense and apply findings elsewhere.

Your website could always be improved, even if it's a page at a time. What's holding you back?

Next Steps and Questions for Digital Marketing Budgets in 2023

Digital marketing budgets are increasing for 2023, but businesses need to be careful to spend budget where results can be tracked and where the greatest return on investment can be achieved. With the possibility of a recession keeping the sales pipeline strong should be everyone's top goal.

• How much as a percentage of revenue will you budget for digital marketing in 2023?
• Does my company need more leads to hit our sales targets, or do we need to focus on improving close rates?
• How will you measure your results? Note: we recommend setting goals yearly and we made a goal template available for your use here.
• What internal resources can you tap to accomplish your goals? Do you need to supplement them with other talent? Should you call on a digital marketing firm to help?
• Are your marketing activities aligned to achieve the goals you've set?

If you need some help determining what your priorities should be, or if you might want to consider a digital marketing agency to help with your marketing in 2023, we offer a complimentary marketing opportunity review.

Note: This article was originally published in 2018 and last updated on November 2, 2022