Digital Advertising

Digital Marketing Budget – How Much Do You Need To Spend On It?

Digital Marketing Budget – How Much Do You Need To Spend On It?

A digital marketing budget that used to be dedicated to creating catchy jingles and print advertising are now focused on search engine optimization and social media marketing.

If you traveled 20 years into the past and asked people about digital marketing, most of them wouldn’t know what the hell you were talking about. But in the last two decades, the shift to digital has completely reshaped the marketing landscape.


Looking back on it, it’s crazy to think about how much has changed in such a short period of time.

But if you haven’t been in this industry for half your life like I have, it can be tough to know how much you should be spending on digital marketing.

If you’re dealing with this dilemma then this blog’s for you.


How Much You Need to Spend on Your Digital Marketing Budget?

Follow the Money

At the beginning of the 21st century, most marketing dollars were being spent on things like magazines, newspapers, radio, and TV ads.

Today, spending on print advertising is on a sharp decline, and radio ad spending is stagnating.

TV ad spending continues to see slight increases, but in 2017, digital ad spending finally surpassed television.

And it doesn’t look like that trend is going away.

According to data from Statista, worldwide digital ad spending is forecast to increase to nearly $350 billion by 2022, while spending on TV ads looks like it’s ready to flatline.

digital marketing spending


Data from Statista also shows that online advertising revenue in the U.S. has multiplied more than ten times since the year 2000.

US online advertising revenue 2000 to 2017


But what does this all mean?

Well, digital is obviously working better than traditional forms of marketing, otherwise, we wouldn’t be seeing this trend.

Does this mean you should be pouring your whole budget into digital marketing channels?

Not necessarily.

But before we get into all that, let’s look at what marketers and business owners think.

Find a Frame of Reference

I’d be bullshitting if I told you I know how much every business needs to spend on digital marketing.

But looking at what other businesses are doing provides a much-needed reference point.

So, let’s examine some survey results, which should provide some perspective.

A recent survey from The Manifest asked 501 digital marketers how they invest in digital marketing.

Survey results show that 99 % of businesses are planning to spend more money on digital marketing in the next year.

The survey also found that most businesses will allocate either 26-50 % or 51-75 % of their marketing budget to digital channels.

digital marketing budget


In addition, the survey found that most businesses plan to spend more on several digital marketing channels, but websites and social media marketing are the top priorities.

Digital Marketing budget


The Manifest’s survey provides a good point of reference for business owners.

However, most respondents came from companies with revenue in the tens or even hundreds of millions of dollars.

But what about small businesses?

Thankfully, Clutch’s 2018 Small Business Survey offers some insights that’ll hit closer to home for small business owners.

The survey found that 47 % of small businesses spent less than $10,000 on digital marketing in 2017.

How much small businesses spent


The survey also found that 62 % of respondents have a website and 61 % use social media.  This shows that most small businesses are engaged in some form of digital marketing.

online digital marketing


Obviously, it’s not that digital marketing isn’t working for small businesses or they wouldn’t be doing it.

But the fact is, many of them just don’t have much money to spend on marketing.

In any case, it’s clear that digital marketing still has a lot to offer, even on a shoestring budget.


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Do What’s Right for You

So, we’ve looked at where the money’s going and examined what marketers and business owners are doing.  But now comes the tricky part.

You can analyze stats and surveys all day, but what the majority’s doing isn’t necessarily going to be what’s right for your business.

Ultimately, the percentage of your marketing budget that should be spent on digital marketing depends on your industry and your target market.

If you’re selling video games or skateboards, newspaper ads and flyers probably aren’t your best bet.

On the other hand, if most of your customers are pushing 70, you might have a lot of success with those channels.


There Are No Hard and Fast Rules.

If you’ve been having a ton of success with one tactic, don’t start pulling funds out of that channel because your competitors are doing something else.  Stick with what works.

The same goes for setting your marketing budget. You can look at facts and figures till you’re blue in the face, but at the end of the day, you’ve got to do what’s right for you.

If you need a benchmark, the graph below, pulled from the August 2018 CMO survey, will give you an idea of what businesses are spending on marketing.

Budget for Digital Marketing


Plan and Prioritize

Once you’ve set your budget, the first step in crafting your marketing strategy is determining your target audience.

If you don’t know who you’re marketing to, you’re setting yourself up for failure.

Next, you need to look at your past marketing successes and figure out which channels are bringing you the most revenue.

The best way to prioritize your marketing tactics is by looking at what’s providing the greatest return on investment.

In other words, you need to consider what’s working and what isn’t.

Remember the old adage: “If it ain’t broke, don’t fix it.”

The next step is to determine what your marketing goals are for the next year.

These objectives need to be as specific as possible and you need to be able to quantify them.

For example, let’s say the channel you want to focus on is social media marketing.


In this case, you need to:
  • Choose the platform(s) you’re going to use (Facebook, LinkedIn, etc.)
  • Decide how you’re going to use them (content marketing, social media advertising, etc.)
  • Determine how much you’re willing to spend, and what target you’re trying to reach.


Here’s what it would look like on paper:

online marketing experts


Did these tips help you to set your digital marketing budget? Leave a comment and let us know how we helped.


Still not sure how much you should be spending on digital marketing? Visit and book your Free Strategy Session with a Digital Marketing Expert today.

Rob Pacinelli

Roberto Pacinelli is the VP of The Best Media and Senior Digital Marketing Strategist with a career in digital marketing spanning over 19 years. Roberto and The Best Media have helped thousands of small, medium and large businesses succeed online across Canada, USA and the world with many business owners recognizing Roberto and his team as their Key to Success in helping their businesses earn millions of dollars as a result. Call Roberto Pacinelli at 416 253 0934 or email him at