Cracking the Code on Paid Media Budgets

paid media budgets

Paid media budget allocations… one of the most important and dreadful aspects of managing a marketing budget. This guide shares tips for integrating paid media campaign costs into your overall marketing budget so you can spend smarter, not harder.

Understanding Marketing Budgets

What’s the deal with marketing budgets? A marketing budget is like your money GPS for promoting your stuff. It covers everything from paying your team and agency fees to creating killer content and actually running ads. To achieve your business goals, you must slice and dice that budget. Figure out what you want to achieve, then use a marketing funnel approach to create strategies that match each step your customers take. Be realistic in allocations. Ideally, we’d like to throw all the available funds into the actual ad spend (the funds paying to actually show your ads to your customers), but if you don’t have someone to manage the campaigns and a creative that converts, those dollars won’t hit their maximum value. In the end, you could ultimately be losing money. 

Paid Media Campaigns in the Mix

How does Paid Media fit in with everything else? Once you lay out all the costs associated with marketing, it’s time to allocate percentages to each item. Understanding how much to use for paid ads can greatly differ between businesses, so there’s no right answer. But generally, we recommend businesses spend 40% of their marketing budget on ad placement. But be smart and flexible about it – learn how to divvy up a chunk of your budget for ads, splitting it across different stages of the customer journey to get the most bang for your buck.

Steps to Get Your Paid Media Budget on Point

Step 1 – Lock in your goals:

Match your marketing goals with your bigger business dreams. Whether it’s shouting about your brand, bagging sign-ups, or making online sales, be clear about what you want so it drives the right actions, not only in your marketing, but across your entire business. 

Step 2 – Develop basic KPIs:

Whip up Key Performance Indicators (KPIs) that match your goals. Whether it’s counting conversions, raking in revenue, or measuring clicks, set up some yardsticks to see if you’re winning. 

Step 3 – Do some backward math:

Use past data or averages from your industry to guess how much your goals might cost. And don’t forget to factor in the quirks of your favorite paid media pals like Google and LinkedIn. They (and other marketing tools) can help you estimate costs to get an idea before launch. So if your average cost per conversion is $10, and you want to get 100 conversions per month, you’ll need $1,000 for paid ads. For most of us, things won’t be this simple, but you get the idea. 

Step 4 – Be ready to tweak things:

A question we get often – how often should you evaluate your paid media budget? Your campaigns should be like a DIY project – ready for tweaking and testing along the way. Keep an eye on what’s happening, and be ready to make changes based on the KPIs you set in step 2. Generally, we recommend keeping campaigns live for 3-6 months before making any major changes (curious about what counts as “major”? Stay tuned for future blog posts with more info!). However, this can depend greatly on the budget. Higher budgets allow more flexibility in campaign changes since they will reach more people faster and gain more learnings quickly. Adjusting smaller budgets too soon can disrupt data collection, which would help you improve performance. After your campaigns have been live for a sufficient amount of time, we recommend evaluating your paid media budget monthly. Having someone on your team or an agency monitoring weekly or even daily pacing will ensure you don’t overspend and give insight into optimizations.


So, as we wrap up our journey through paid media budgets, remember: there’s no one-size-fits-all answer. Experiment, try out new stuff, and keep tweaking. Marketing is always changing, so staying current, open minded, and flexible will help you make the most of your time and spend. Check out our blog for more marketing tips to level up your game. Happy budgeting!

Need support managing paid media campaigns?