Calculate Digital Marketing Budget (For Beginners) 

Thanks a lot Tim! Really appreciate your feedback! :)

Glad you found it helpful! Feel free to drop me questions

@@graceleungyl Ok. Thanks for the offer. I would be so greatful if you could help me with this: How you would use this information to create a media plan? Current performance Average Booking Value = £1,845 Total Bookings 2022 = 5,000 New vs repeat bookings = 60%/40% (These numbers are representative only) Brief Propose a mix of performance media activity for a calendar year designed to deliver on the overall web target of £18 million in Revenue, with an overall media budget of £900,000. The client would like to work to a £500 overall cost per booking. Many thanks in advance :)

Ok thanks for the offer. Here is my question We have a Current performance Average Booking Value = £1,845 Total Bookings 2022 = 5,000 New vs repeat bookings = 60%/40% (These numbers are representative only) Brief : Propose a mix of performance media activity for a calendar year designed to deliver on the overall web target of £18 million in Revenue, with an overall media budget of £900,000. The client would like to work to a £500 overall cost per booking. " How would you start here with the numbers? How would you create a media plan out of this? Many many thanks in advance

My approach: 1/ Identify the marketing goal -> 9,756 bookings (£18M/ 1,845) 2/ Review past performance in 2022 and gather historical data, both paid and organic: - Average cost per booking from paid channels - Avg. conversion rate from every paid and organic channel - Conversion % from every paid and organic channel - Ratio of booking performance ratio between organic vs paid - Avg. CPC for paid channels 
 3/ Since this case, you already had a media budget target, you will use it to calculate backwards on the required conversion target. Assume max. cost per booking is £500 (or if you have avg. cost per booking from paid in step 2, use it instead so you have a more realistic figure), target bookings from paid should at least 1,800 with a £900,000 media budget. ==> Paid channel target: 1,800 (~18%) ==> Organic channel target: 7,956 (~82%) *Bonus - you also get a sense how realistic the target or cost per booking by comparing the ratio of paid vs organic / actual cost per booking from your past performance. 4/ List out all potential channels and set the conversion target for each, based on conversion target you derived in step 3 and conversion % from step 2. For this case, since organic accounts most of the booking target, so you should start from the best performing organic channel. 5/ With conversion rate from step 2, you can derive the target traffic needed for organic channel and paid channels. 6/ With traffic target, and CPC data in step 2, you can derive the target budget required for the paid channel. 7/ Then keep track of your actual performance versus your plan, traffic target, CPA target, conversion target for , and make budget shift or optimization accordingly (if needed). Some final thoughts: - That’s almost a double of booking target versus last year, if the budget increase is on a similar proportion compared last year? If not, then you immediately know you need to double down on organic channel to hit target or you need to review the media budget to make it realistic. So also do a budget plan without the £900,000 media budget ‘pre-requisite”, then compare the gap, make adjustment to make it as realistic as possible. - Although we know new vs returning is 60% : 40%, we need to determine the purpose for this campaign is aim to drive new or existing. Paid is often used to drive new while organic is for existing (most cases). This will give you sense that if the media mix really aligns with your new customer growth plan. Hope that helps!

@@graceleungyl Thank you so much. I had the interview for an account manager position , didn't get the job but I learned a lot thanks to your explanation. I think that there is definitely a gap on RU-vid how to calculate budget so keep doing what are you are doing, it's great content and really helpful. If you know any other source to learn media planning like a course which you can buy online or so it would be great if you could it with me. I really want to learn this.