Budget for an advertising campaign: how much should you invest?

If my grandfather were there, he would probably say “a good bit”... but we will try to be a little more specific than that to help you define your budget for an advertising campaign on Facebook, Google Ads, Snapchat, Snapchat, LinkedIn, LinkedIn, Instagram and others, as part of your online marketing strategies. Are we going?

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What does the budget for an advertising campaign depend on?

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The communication/marketing budget corresponds to the total cost of the actions necessary to achieve the communication objectives set. The budget of an advertising campaign depends on several elements! Here they are:

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👉 The size of the market;

👉 The target;

👉 Your projected turnover;

👉 The cost of acquiring a customer;

👉 The maturity of your product/service.

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But also your goals:

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👉 If you want to get answers to your tests more quickly;

👉 If you are in a very competitive market and therefore with very high CPCs (Cost Per Click);

👉 If you have multiple conversion goals, for example, buying and registering;

👉 Depending on the seasonality of your business. Here, the correct distribution of budgets is important!

Ok, but how much advertising budget should be allocated for each of these elements? We explain it to you in detail.

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An advertising campaign budget by issues

I want answers to my tests quickly

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Depending on your objective, it is sometimes necessary to quickly have elements of analysis on your ads tests. This is particularly the case on Meta Ads, where it is important to conduct visual and audience tests to know which target has the best conversion rate and what message is attributed to this target.

Therefore, if you have an interesting budget to invest, you can test several audiences at the same time.

🌟 The Reco Growth Room : allocate around €50/day per audience to get results in two weeks.

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I am in a very competitive market with high CPCs

On Google Ads, for example, we know that CPCs (Costs Per Click) can vary greatly depending on market competition. For example, on insurance markets a click can go up to €15!

🌟 The Reco Growth Room : using the example of insurance, if you want to get 75 clicks per day on this keyword, we advise you to spend a price around €750 if you have a CPC of €10.

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I have several conversion goals

Let's say you have several conversions to track, for example, on a private sales site, you can launch registration campaigns, and then create purchase campaigns.

Result : you will need a larger budget.

🌟 The Reco Growth Room : ideally, we recommend that you put more budget on advertising campaigns to fill the audience pools and then target them to buy. Concretely, the right distribution for your advertising actions on social networks is 80% in acquisition 20% in retagreting.

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I am subject to seasonality

Be aware that if your business is subject to seasonality, you will have to plan budget increases on the agencies used when it is a month of high seasonality to maximize the conversion rate.

Example of an advertising campaign conducted for a Growth Room customer with the budget spent:

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Concretely: how much to spend on an advertising campaign?

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Don't underestimate your advertising investment. Too low amounts relegate you to the least relevant locations and do not offer you a sufficient sample to assess the effectiveness of your online advertising campaigns.

The optimal marketing strategy consists in testing your advertising campaigns over several days, Even 2 to 3 weeks, with a media budget of 2000 to 5000€. This positions you among serious advertisers. You may not compete with Nike or Uber, but you will quickly outperform small advertisers who “boost” their posts for €50 to €200.

In Social Ad Campaign, it is more appropriate to invest a large budget over a short period of time rather than spreading the same amount over a longer period of time. In other words, in order to obtain relevant results, invest €3000 over 3 weeks rather than €1500 over a renewable month.

This test advertising campaign will allow you to collect enough data to measure your KPIs and optimize your advertising campaigns and audiences.

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What if I don't have much budget for my advertising campaign?

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If you're starting out with ads and only have a small advertising budget, don't panic. Already, you need to ask yourself these questions in order to be able to define your budget properly:

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1. Is my business attention or discovery?

👉 Business of attention : Your company's products are already actively sought after by consumers. Example: selling T-shirts.

👉 Disruption : your company's products are new and the market does not yet exist. Example: selling sharpener seasoning pencils. Requires paid acquisition strategies to become known.

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2. Is my product complex? Are there entry barriers?

👉 Complex products, like banking services, require a lot of documentation and explanations, increasing the cost of acquisition.

👉 Simple products, like clothing, have fewer barriers to entry.

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3. Is my product a “must have” or “nice to have”?

👉 Must have : rational and functional characteristics are put forward. Example: a refrigerator with superior functionality.

👉 Nice to have : emotional and aspirational aspects are highlighted. Example: a television that makes the user happier.

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4. How much am I willing to spend to get a customer?

👉 Calculating the real value of a customer is crucial in determining the acquisition budget. This includes the average amount spent, the retention rate, the number of repeat purchases, and the average cart value.

This small SEA audit of your company and business allows you to frame your strategy, determine your online advertising budget, and define the type of messages to send to your prospects during your actions.

🌟 Our recommendation for your ads to still be effective on a small budget:

👉 Prioritize the objectives, the management, the geographical area, the personas... so as not to dilute the budget at the start and to have a minimum volume of data to analyze in order to optimize.

If you are still unsure about how to define your advertising campaign budget and are afraid to take action? Read our article on Top 5 growth marketing agencies in France. Good support and a good action plan are the key to a well-spent acquisition budget!

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