Apart from the pros and cons, the cost of advertising platforms is also an important factor. Discover average advertising costs for small business here.
Media advertising spending has gone up billions in the past 5 years. Businesses are expected to continue spending billions over the next few years. The question that arises from knowing this statistic is, how much should you spend on advertising costs as a small business? Answering this question is especially important for small businesses that can’t spend thousands of dollars on something that doesn’t deliver immediate results.
Advertising costs for small business depends on the product, the funnel, the audience, and what sales system is in place. It also depends on the location of the business. Most importantly, advertising costs differ depending on what kind of advertising you are doing. Google ads cost differently from Facebook ads, etc. So, how much should your small business spend on any kind of advertising? That is what you should know when it comes to each advertising platform, so you can have the most information before you make a costly decision.
Advertising Costs for Small Business Is Different With Each Advertising Platform
Before you decide to spend thousands and thousands of dollars on any kind of advertising, it’s important to look at how each advertising platform is different based on what your business model looks like. It’s important to see what other small businesses are spending on advertising and if it’s effective for their business. If it isn’t, you need to see what makes advertising more effective in landing more customers.
While you may be tempted to go all-in on a marketing strategy with every platform, you want to choose a platform that will give you the most success. That’s why it’s important to look at metrics and see how each platform works for a small business. It’s important to weigh the pros and cons of each platform.
The average cost per click for Google Adwords is between $1 and $2. Some of the most expensive Adwords cost $50 per click. When it is priced this high, it’s usually because these are high-targeted keywords. While major corporations often spend nearly 50 million a year on AdWords, you shouldn’t worry about ever trying to spend this much as a small business.
Your goal as a small business is to spend nearly $9000 to $10,000 each year. This is what the average business spends on AdWords each year. While it doesn’t dictate what you should spend on AdWords each year, you now have an idea of what the average costs for AdWords are and how small businesses are spending. It can guide your budget as a small business and where you want to spend it. More importantly, you now have an idea of what Google AdWords cost for small businesses and if you think they can help generate more revenue for your business.
Facebook & Instagram Ads
The average small business spends between $1000 and $2000 on Facebook & Instagram ads per month. Although this amount varies widely across industries, it does provide insight into what your business should be budgeting for if you’re considering Facebook & Instagram ads.
Small businesses will typically spend this amount on Facebook and & Instagram advertising to boost posts or do conversion advertising. It depends on the industry. When it comes to cost per click, it also varies widely on what small businesses spend. It fluctuates between 45 cents per click in the apparel industry to nearly $4 per click in the finance industry.
You can also assess the metrics of each business and see what they are spending. A business should assess cost per click, cost per view, and cost per action. It measurement ensures that they aren’t spending excessively beyond their budget in order to get sales.
The Value of Location-Based Advertising
Location-based advertising is taking advantage of where users are and send them advertisements based on their location. The advertising is more customer-specific based on their needs. This marketing strategy helps small businesses optimize their marketing strategy because they aren’t spending money on a general location, but rather to specific users. You can find more about how location based advertising companies are helping small businesses thrive with marketing strategies while keeping them within a budget.
Assess Your Needs
The average cost for businesses also depends on your needs. You have to assess your needs vs your budget. If you are looking for one more sale each month, you may not need to spend $2000 each month. But if you are looking for more conversions that lead to multiple more sales, then $2000 for Facebook & Instagram is worth the costs. This also applies to Google AdWords. You have to assess your needs as a business, especially your need to promote your business to bring in business.
Can You Afford the Risk?
While you may have a need to market to your core audience and to quickly generate sales, it’s important to evaluate the risk involved. Spending endless amounts of money on a marketing plan with Facebook & Instagram ads and with Google AdWords is not the solution. The goal is to minimize the risk.
The goal should be to create a marketing plan based on your understanding of what your competitor spends, of what other small businesses spend. This knowledge can help you figure out a realistic budget without feeling like you are risking your business to attain more customers.
Before you decide on any kind of marketing plan, it’s important to take into consideration two things: a marketing plan and your budget. These two essential parts can help you figure out what advertising costs for small business looks like. With this in mind, you now have a realistic idea of what advertising platforms to use and, more importantly, how much they cost.
An understanding of how much advertising costs for businesses can help guide your business budget and ultimately help you profit more by spending less. You can find more information about how much you should spend on marketing for your small business on our site or you can contact us.