What Is the Cost of Social Media Marketing for Small Businesses?
Social media marketing is one of the most efficient and effective ways for small businesses to connect with customers. It allows companies to build relationships with potential and current customers, create brand awareness, and generate leads.
But social media marketing can be expensive, so business owners need to understand what factors affect their spending on social media marketing and their options. In this blog post, we will explore what social media marketing is, what content marketing is, the factors you need to be aware of, how to make a social media marketing budget, and the costs depending on which option you choose.
If you’re wondering how much social media marketing costs or what social media marketing companies do, this article has you covered.
What is Social Media Marketing?
Social media marketing means using today’s leading social media platforms to promote and sell products or services. Businesses can use social media to connect with customers and build relationships, generate leads, create brand awareness, and drive sales.
Here are the key takeaways about what social media marketing is:
- Allows businesses to use social media on social media networks (Facebook, Instagram, YouTube, Snapchat, Twitter, etc.) to sell their products, engage with their existing customers, and find new ones.
- Allows you to influence customer behavior by promoting content that will drive how customers shop and what they should purchase.
- Since social media today is so omnipresent, you need to use solid marketing techniques on these platforms to win over customers, influence their buying decisions, and beat your competitors.
- Social media’s power comes from its incredible ability to allow small businesses to connect with more customers, interact with them, and categorize all the data that comes with it.
Make no mistake; if you are a small business, you need to have social media marketing work for your company on some level. Social media has become an essential part of humans’ lives, and not harnessing that power would be a massive missed opportunity for small businesses everywhere.
Content Marketing and Social Media Marketing Go Hand-in-hand
It’s important to note that very few companies have a social media marketing strategy that exists in a silo. Most companies serious about social media marketing also invest in content marketing.
So, what is content marketing?
Content marketing is creating and sharing content (blog posts, videos, infographics, etc.) that is valuable and relevant to a company’s audience.
Quality content marketing aims to drive audience members to take action, such as investing in the company’s products or services.
Social media platforms are the primary mechanism for sharing content. This is why it’s essential to consider both social media marketing and content marketing when you’re negotiating social media marketing costs and planning your company’s budget.
A holistic view of your company’s social media presence can ensure you get the most bang for your buck.
Why Does Social Media Marketing Matter to Small Businesses?
Small businesses need social media marketing because it’s an efficient and effective way to connect with customers.
There’s no doubt that social media marketing can benefit businesses of all sizes. By allocating a budget for social media marketing, you can
- Reach a larger audience
- Build relationships
- Create brand awareness
- Connect with your target market
- Increase traffic to your website
- Generate more leads and sales
Additionally, social media marketing allows you to offer better customer service by connecting with customers and resolving problems more quickly. In the long run, social media marketing can increase your business’s brand awareness and long-term growth.
So, if you’re on the fence about investing in social media marketing, consider all of the potential benefits it could have for your business. Chances are, you won’t be disappointed.
What Factors Affect How Much Companies Spend on Social Media Marketing?
Several factors affect how much companies spend on social media marketing. These factors include the company’s size, industry, budget, and goals.
Plenty of variables can influence your social media marketing budget and cause you to spend more or less money than what is outlined above. These variables include
- The size of your company
- The industry sector you are in
- Specific business goals
- The software and tools you use
Companies with more employees may spend less on social media marketing than those with fewer employees because large companies have more name recognition.
Retail companies may also spend more on social media marketing than IT companies because they are trying to build brand awareness. However, if your specific goal is to increase sales, you may want to focus your social media marketing efforts on platforms like Twitter and Instagram Ads.
You can hire an in-house marketer or outsource the work to a social media marketing agency. However, whichever way you choose, you need to include social media marketing in your small business budget.
How to Make a Social Media Marketing Budget
The primary factor for a small business to decide how much social media marketing will cost is to decide on a budget. Social media marketing costs are not constant across the board. Companies can choose how much they want to spend by making a budget.
However, how much is spent is usually reflected in how fast your social media marketing will work for you and how many more customers your business gets. Generally speaking, the more you budget for social media marketing, the faster and greater volume of results you’ll see.
What to Consider for Your Social Media Marketing Budget
Businesses should consider their goals, target audience, and platform when making a social media marketing budget. They should also consider what they can afford and what resources they have available.
It’s essential to create a social media marketing budget that you’re comfortable with. Spending too much can put a strain on your finances, while not paying enough can limit the effectiveness of your social media marketing campaign.
While there is no clear-cut guideline on how much of your revenue you should allocate to social media marketing (some websites say 2% to 5%, some say up to 20%), the Small Business Association recommends that whatever you put into social media marketing, make sure you maximize it.
Here’s a quick guideline to follow for a starting point for a social media marketing budget from the SBA and Databox:
If your company makes less than $5 million per year, spend about 7% to 8% of your total revenue on marketing.
Start-up companies can allocate more (12% to 20%) to their social media marketing budget to gather customers and establish trust.
More established companies can spend less (6% to 12%) and use it for continuous growth, advertising sales, or informing about new products.
Three Things To Help Maximize Your Social Media Marketing Budget
Here are three tips to help you maximize your social media marketing budget:
Market Research
Doing market research is one way to ensure you’re spending the right amount. Learn about where your audience spends the most time online. There’s no point in spending a lot of money advertising on a social media platform that none of your target customers use. Once you know where they are active, you can create a social media marketing budget that works for you.
Remember that you may need to adjust your budget as your social media marketing campaign grows and evolves. But with careful planning, you can create a successful social media marketing campaign without breaking the bank.
Know Your Analytics
Another critical factor to keep in mind is monitoring analytics. Follow the types of content and social media posts that get the most attention, then create more content and ads similar to that content for the future. This will help you better understand your audience’s response and give you a better return on investment for your social media budget.
Using An Agency
Agencies know what they are doing and can help you stretch whatever dollars you want to put into social media marketing to their fullest. They charge flat fees for their services, which is more cost-effective than hiring an in-house employee and paying for all the extra costs that come with them. Plus, social media agencies have the expertise and experience to create and implement effective social media campaigns to help you achieve your marketing goals.
Consider working with a social media agency if you want to save money on your social media marketing budget.
So What is the Cost of Social Media Marketing for Small Businesses?
As mentioned, the cost of social media marketing will depend on how much your business decides to spend on your budget. Companies can use social media platforms to connect with customers, build relationships, generate leads, create brand awareness, and drive sales. How much you spend to achieve these goals will depend on the three methods you choose.
Here, we’ll look at the three most common ways small businesses can do social media marketing and how much each of those ways will cost. Then you can decide which is best for your small business. The three forms of social media marketing for your small business are: doing it yourself, outsourcing with a small budget, and outsourcing with a large budget.
Doing It Yourself ($20 to a few hundred dollars monthly)
Social media marketing can be a cost-effective way to connect with new potential customers if you choose to do it yourself.
However, social media marketing requires a lot of research and consistent effort. If you’re not willing to do the work, it’s probably not worth doing it yourself. Fortunately, affordable social media marketing software programs can automate your process.
Hootsuite, Buffer, and Hubspot are great social media marketing software programs that will help you save time and energy. They all have built-in schedulers so you can plan your social media content, making it easy to control all of your social media accounts from one convenient location.
If you’re serious about social media marketing, investing in one of these programs is worth it.
Allocating a Small Budget (up to $1000 per month)
Working on a small marketing budget is hard, but small businesses always have to do it. If you have enough money to outsource your social media marketing, there are many affordable options for your emails.
First, you need to find an agency. Agencies have a lot of different packages and pricing models based only on their estimates, as opposed to industry standards. This happens because, unfortunately, there are no established pricing standards for social media.
That means you’ll have to shop around and research to find an agent in your price range with a good reputation. That can be a challenging combination of qualities to find, but finding the perfect agency for your business is worth it. Once you’ve found an agency, social media outsourcing doesn’t have to be very expensive.
For example, if you just want help with content creation, you can hire someone for a few hours a week to help you brainstorm and create posts. This relatively low-cost option can still make a big difference in your social media presence.
Allocating a Larget Budget ($1500 to $5000+ monthly)
You can outsource social media management to an agency if you have more money. This means they will handle everything from creating content to engaging with followers and monitoring analytics. This is an excellent option if you don’t have the time or energy to invest in social media yourself.
Outsourcing social media doesn’t have to be expensive or complicated – plenty of affordable options are available. Research and find the right agency for your business and budget, and you’ll be on your way to social media success.
If you have a bigger budget for social media marketing, you have more options to choose from. You can take a chance on a higher-priced agency and hope they deliver superior results. Or, you can save money by selecting a smaller, less expensive agency.
The most important thing to remember is to do your research before making any decisions. Disreputable agencies will try to take advantage of you if they know you don’t have a budget cap. Read the fine print and understand what is being asked of you before signing any contracts.
If you decide not to do your social media marketing yourself, you’ll want to know the basics about what a social media marketing company does, so you can hire the one that best suits your needs.
What Does a Social Media Marketing Company Do?
A social media marketing company helps businesses to connect with customers, build relationships, generate leads, create brand awareness, and drive sales. It will design and manage social media accounts, develop strategies, and execute social media campaigns.
A social media marketing company also provides various services to help businesses promote themselves online. The most basic service is creating and posting content on the brand’s behalf. This can include writing and publishing blog posts, creating graphics, and managing social media accounts.
Most social media marketing companies will also offer follower growth services. This can involve following and liking other users’ content, participating in conversations, and running promotional campaigns to encourage people to follow the brand.
Another standard service is social advertising. This involves paying social media platforms to display the brand’s ads to a broader audience. It’s an effective way to reach people who use social media regularly, but it can be more expensive than other services.
Some social media marketing companies offer strategy and employee management services. These can include developing a social media strategy, training employees on using social media, and monitoring the brand’s activity. These are often the most expensive social media marketing companies. Still, they can be worth the investment for businesses that want to get the most out of their social presence.
Wrap Up
Social media marketing is an excellent way for small businesses to connect with customers and grow their business. Several factors affect how much companies spend on social media marketing, but many options are available to fit any budget.
Many small businesses must decide how much to invest in social media advertising. If you are just starting, you might want to invest more heavily to grow your customer base. You can spend less if your small business has a thriving customer base and just needs to promote new products or advertise sales.
You can also choose to do everything by yourself with the help of some social media marketing software programs, or you can spend more money and hire outside help. If you don’t have the time or inclination to do all the social media marketing for your company yourself, consider working with a social media marketing company.
They can help you develop a strategy and execute campaigns that will help you achieve your goals. While their fees may seem high initially, consider the long-term implications of having a more extensive customer base that will provide recurring revenue for years. The costs of hiring an agency should be repaid tenfold by the relationships and customer base built by a professional social media marketing company.
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Author Bio
Andrew Dunn is a serial business builder with over seven years of experience growing businesses. He is the founder of INDMND.com, providing valuable insights for business owners to leverage technology to 10x their businesses. He is passionate about scaling businesses using SEO, paid media, and remote teams.
