How Should You Split Your Marketing Budget Across Different Channels?

Key Takeaways

• There’s no one-size-fits-all way to split your marketing budget. The right mix depends on your business, market, goals, and performance data.
• Media Mix Modeling uses historical data to understand how marketing investments across different channels contribute to business results.
• MMM can help identify where to increase or decrease spending, how channels work together, and where your next marketing dollar could have the most impact.
• Hibu draws from 30 million rows of historical campaign performance data to help establish a data-informed starting marketing mix.
• Hibu combines data, technology, and marketing expertise to continually evaluate and adjust your marketing mix, so you don’t have to do it yourself.

Regardless of how they came to call or walk through your door, it all started because you were marketing your business.

But there are so many ways to market your business nowadays. Small businesses will typically use three to four different advertising channels. And while not every channel is created equal for your specific business, they all come with a cost. 

For example, a plumber might want to allocate more marketing budget to local SEO and Google Ads so they can show up to customers in their area. But a retailer might have better success with most of their budget going toward email and social media ads.

So how do you determine the right marketing budget split to get the best ROI for your business?
The answer is by having the right data. And Hibu has decades of it from running hundreds of thousands of marketing campaigns for businesses just like yours.

[Related: How Hibu One Maximizes Your Local Business Marketing ROI]

Why splitting your marketing budget isn’t as simple as it sounds

When you’re investing in multiple types of marketing (which you absolutely should be, because a diversified marketing program is a successful marketing program), it can be tempting to just divide your budget evenly between them. Or maybe if one channel is bringing in the most leads, you might just think it’s smart to put the bulk of your budget there.

But your customers don’t always take such a direct path to your business.

For example, someone might see your business in a Facebook ad first... then find you again on Google, read your reviews, click to your website... and then finally pick up the phone.

Google is the channel getting the credit for that lead because it was the final step, but that initial Facebook ad and your reviews all had a hand in influencing that potential customer’s decision.

That’s exactly why finding the right marketing mix means understanding how your channels work together, not just which one gets the final click or call. If you’re just dividing your budget evenly, you might be missing opportunities.

[Related: Why Local Businesses Need an All-in-One Marketing Platform]

What is Media Mix Modeling?

That “right marketing mix” is what we marketers call “Media Mix Modeling” or MMM. It’s a way to use historical data to determine which parts of your marketing are having the biggest impact on your business sales and return on investment (ROI).

And knowing what’s actually working isn’t always easy. In fact, 73% of small businesses worldwide aren’t sure their current marketing strategy is working.

It takes all that historical data and compares how much was invested in different marketing channels with real business results, like leads, calls, appointments, or sales.

Say you increased your Google Ads during certain months. Did you also see an increase in leads? What happened when you spent more on social media or SEO? What combination or marketing seemed to produce the strongest results for you? And is that consistent year-round, or does it change seasonally?

By analyzing those patterns over time, Media Mix Modeling can help show how your marketing investments may be contributing to your overall results and where your budget could have the most impact going forward.

In essence, it answers the important question of: Where is your next marketing dollar likely to have the most impact?

No guesswork. No wasted money. Just real insights based on real data.

[Related: Ask an Expert with Hibu: Chief Product Officer Nick Hopkins Talks Paid Ads]

What can Media Mix Modeling tell you about your marketing budget?

Once you have enough data (a few years’ worth at least), then you can start using the insights you’ve gathered to make smarter decisions about your budget.

Media Mix Modeling can help you understand:

• Which channels are contributing to results: What’s helping drive leads, sales, or other business goals? 
• How your channels work together: Different channels can support each other throughout the customer journey. Local SEO might help a potential customer discover your business, but your online reviews give them the confidence to contact you, for example.
• Where to increase or decrease your spending: See where putting in more budget could improve your results and where it might make sense to pull back. 
• When you may be spending too much on one channel: Adding more money to one channel, even a channel that’s producing results, won’t always keep increasing those results.
• How to get more from your overall budget: Compare different ways of dividing your marketing dollars to find a mix that could produce stronger results.

And none of this means you need to spend more of your hard-earned money on marketing. MMM is all about making the budget you already do have work harder by putting your dollars where the data shows they’re most likely to make an impact. After all, small businesses with a marketing plan are 6.7x more likely to report marketing success than those without a plan.

[Related: How to Make the Right Marketing Investments]

Why more data can lead to smarter marketing decisions

Media Mix Modeling needs to have quite a bit of high-quality data in order for it to work most effectively. And we understand that for a local business owner like yourself, that might be hard to come by. 

That’s where Hibu comes in.

Since we’ve been running digital marketing campaigns for small and medium-sized businesses for decades, we can draw from 30 million rows of historical campaign performance data across different marketing channels, industries, and geographical markets—which gives the model a much clearer picture of what has worked for businesses like yours in different situations.

With that data behind us, our marketing experts can identify the patterns for you. We look at factors like your specific type of business and your market to establish a starting marketing mix that’s designed to generate the most leads for your business in the most cost-effective way possible.

But that starting mix isn’t set in stone. As your campaigns run and we gather data specific to your business, we adjust your budget across different channels based on what’s actually working.

In other words, we start with insights from millions of past campaign results, then customize your mix as we keep gathering data.

[Related: When is it Time to Outsource Your Digital Marketing?]

Hibu does the heavy lifting for you

So, as you can see, you can keep your day job as a plumber, dentist, lawyer, or HVAC pro instead of becoming a data scientist. And that’s important when 56% of SMBs say they have an hour or less each day to spend on marketing, and 52% routinely put marketing off in favor of other activities. With Hibu, you can take advantage of Media Mix Modeling without having to analyze all that data yourself.

Our data, technology, and marketing expertise come together to help inform you how your budget is allocated across different marketing channels. And because your marketing solutions are managed together through the Hibu One platform, both you and your Hibu account manager can look at the bigger picture together instead of making decisions about each channel on its own.

You get the advantage of smarter, data-informed marketing strategy without the extra work of having to analyze all that data yourself.

[Related: Hibu One vs Multi-Vendor Digital Marketing Solutions]

Your marketing mix should keep evolving

You should also keep in mind that the marketing mix working for your business today might not be the right one six months from now—especially if your business is growing, which is always the goal.

A lot can change, like:

• Customer behavior: How and where people search for products and services like yours can shift. Take AI as an example.
• Competition: New competition might enter your space or previous competitors adjusting their own marketing can affect your results.
• Seasonality: Depending on your business, demand for your products or services can rise and fall throughout the year. A Midwest roofer might experience a lull during the winter.
• Budget and goals: Your priorities change as your business grows. Instead of more leads, you may want to switch to nurturing the ones you have.

Your marketing needs to be continuously monitored and adjusted over time. This way, you can keep your mix aligned with your business and goals.

[Related: Hibu is Making Sure Your Small Business Stays Visible in AI Search]

Get the most out of your marketing budget with Hibu

So, how should you split your marketing budget?

Well, there’s no one-size-fits-all answer. Finding the right mix depends on your business, your market, your goals, and analytics.

But you didn’t start your local business because you wanted to become an expert in data, marketing budget allocation, paid ads, SEO, or any other marketing channel. When you partner with Hibu, you get help from an expert in all of those areas, so you don’t have to figure it out on your own.

We combine data from millions of campaign results with decades of local marketing expertise to help make sure your business is getting found and getting chosen in your local market, without wasting your money.

If you want to chat and give us more information about your business so we can help give you a more definitive answer about your marketing budget, you can call us at 877-237-6120 for a free consultation, or request a Hibu One demo.