How much do people generally spend on marketing? Probably more than you think!
This article will discuss the typical marketing budget for an established brand of product. I’ll cover how big it should be, some of the big trends that can be factored in, and even some tips on how
you can make yours bigger.
All of this information is based on the statistics and budgets presented by three of the most popular web companies in the marketing business: Facebook, Twitter, and LinkedIn.
According to social media statistics website SocialBakers, people worldwide spent an average of 160 million hours each day on Facebook in 2011, spending around 10% of their average daily income on Facebook ads.
Facebook receives an average of 2,700,000 website visits each day. That’s a hell of a lot of people!
Each day Facebook gets an average of 133,000,000 hits per day. Facebook receives an average of 830,000,000 individual app installs per day.
Facebook received roughly 88 million app installs per day in February.
Keep in mind, the numbers are averages, so there will be outliers.
Now, let’s take a look at the average budget that Facebook gets:
Facebook gets $1.33 for each impression. It gets 10 cents per impression for Facebook native ads.
Let’s assume a three percent conversion rate. That’s $0.06 for each click. You can go to an ad network to buy click impressions (e.g., AdTrap, Google Ad Planner), but that isn’t the purpose of this article.
If you put in $1,000,000,000, you’d need to buy 2.85 million ad impressions (per day) to get 2.85 million clicks (per day). In this example, Facebook would be generating $22,500,000 per day in revenue.
If you’re concerned about this, you can double it by buying 5 times more impressions. I’ll talk more about that in the “What does a typical marketing budget look like?” section.
Additionally, Facebook has recently passed 50 million users. If you want to reach the 1.8 billion or so users out there, Facebook is pretty darn good.
Twitter has a similar landing page but doesn’t have quite as many numbers.
According to Twitter, it gets an average of 157,000,000 unique visitors per day.
Each day Twitter gets an average of 70,000,000 site visits.
Twitter gets an average of 1,800,000,000 visitors per day.
If you make an average of $3 for every impression, Twitter will give you about $640,000 per day in revenue.
Now, let’s assume an average click conversion rate of 1% per click. That’s $9 per click.
If you put in $5,000,000,000, Twitter would give you about $1,490,000,000 per day in revenue.
Twitter gets an average of $0.11 per impression.
There are many different ways to get traffic, and sometimes you might have to pay a bit more to generate more clicks.
For example, when I launched my new site, I spent $100 on a major site link. It generated over $500,000 in revenue, not including the investment in time.
That was a pretty good return on my initial investment!
According to Facebook, it receives an average of 73,000,000 unique visitors per day.
Each day it receives an average of 1,600,000,000 visits.
LinkedIn gets an average of 62,000,000 visits per day.
If you make an average of $3 per click, LinkedIn will give you about $164,000 per day in revenue.
If you make an average of 1,600 clicks per day, LinkedIn will give you about $250,000 per day in revenue.
Again, these numbers are averages. In actuality, you might get significantly more traffic on LinkedIn. Or you might get significantly fewer clicks.
It all depends on how you optimize your site for LinkedIn.
Now, let’s look at the average budget that LinkedIn gets:
LinkedIn gets $5.75 per visitor.
This is pretty consistent with the other two sites. This is quite a bit more expensive than the other two sites, but you get a better return.
LinkedIn gets an average of $1.09 per visit.
LinkedIn gets an average of $2.35 per click.
This site seems to have a similar conversion rate to the others.
For now, I’m going to assume that LinkedIn is an average. I’ll get to the worst-case scenario in the next section.
Facebook and LinkedIn both generate a ton of money, but they have very different profit margins.
Facebook generates the most revenue per visitor, despite having the lowest average conversion rate of all the sites!
Facebook generates about $9.74 per visitor.
If you put in $5,000,000,000,000 into Facebook, you will get about $274,500,000 per day in revenue. That is about $29.14 per day. Not bad!
The problem is that Facebook has a hard and fast rule that you cannot make money from your advertising. That means Facebook might not accept any ads that do not indicate an engagement in some way.
That doesn’t make sense, but I’m sure there is a reason for it.
LinkedIn generates the second-most revenue per visitor, despite having the lowest average conversion rate!
LinkedIn generates about $1.43 per visitor.
If you put in $5,000,000,000,000 into LinkedIn, you will get about $93,000,000 per day in revenue. That is about $20.59 per day.
LinkedIn’s conversion rate is lower than Facebook’s. On average, LinkedIn gets about 0.2% conversion rate, while Facebook gets about 0.36%
As you can see from the above graph, LinkedIn’s conversion rate is significantly lower than Facebook’s.
LinkedIn has a slightly better profit margin than Facebook, but it is still lower than the other sites.
You’re better off building a site that generates a higher ROI than you could get by using Facebook ads.
That means you need to be laser-focused on how you rank your site for organic search and how you rank your site for content ranking.