The benefits of a flexible SEA budget
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As a marketer, you probably know it. You get a SEA budget and you have to make do with it all year round. But how do you respond to ‘good’ and ‘bad’ days with your SEA campaigns? And how do you get the most out of the seasons? The answer is: a flexible SEA budget. How? I’ll tell you all about it.
What is a flexible SEA budget?
With a flexible SEA budget, you are not stuck to a certain budget per month/year, but you work with a percentage of the turnover. Because you work with a percentage of the turnover, you can invest more if your turnover increases. But also the other way around: by investing more, you can let the turnover grow.
When is it useful to use a percentage?
A flexible SEA budget can be applied in any situation. But some situations are better suited for it than others. A flexible SEA budget is extremely suitable when:
strong seasonal influences are
a clear distinction can be made between well-converting and less converting days (this is only possible if you have achieved sufficient conversions, otherwise you will optimize based on random hits*)
there is sufficient stock to go full throttle
capacity to accommodate the increasing conversions
The flexible budget is suitable for products and services, but the result is easier to measure for products. This is because when you sell a product, you immediately know what you get in return and whether the marketing costs are in proportion to the revenues. You can also calculate your margin in advance. This way you know what you can spend on marketing at product level. This allows you to spend more on marketing for products with a higher margin.
Flexible budget for services
With services this is a bit more difficult. When you realise a lead, it is not yet certain whether this will actually become an assignment and what the associated turnover is. Of course you can work with an average score percentage and an average turnover per assignment. Based on this you can determine the marketing budget, by multiplying the marketing budget per assignment by the number of assignments you want to get.
*Google recommends setting up Maximize Conversion list of saint lucia consumer email Value – with target ROAS – when you have achieved at least 15 conversions in 30 days. For all other automated bidding strategies, Google recommends a minimum of 20 conversions over 20 days.
Accommodate seasonal influences
A flexible SEA budget offers a solution when you have a good insight into the a lime green ‘brat summer’: the genius marketing behind charli xcx’s brat trends of your company and industry. Take swimwear for example. Trends from Google and others show that demand starts to rise in January and peaks in June.
Important to keep in mind here is the following: historical sales aleart news figures (of your company) help to create insights into seasonal influences, but do not show what the total market size was. This is because your organization may have been held back in the previous year(s) by, for example, a limited marketing budget or limited inventory. Based on the impression share for search, you can make an estimate for the growth potential.
With a flexible budget, you as a company can grow with the increasing demand in the market. By increasing your budget in these months, you can meet the search demand. Because the number of visitors increases, the number of conversions increases (if the conversion percentage remains at least the same) and with it the turnover. This way you earn back the investment in marketing costs. As long as every euro you invest yields profit, you can continue to invest until the percentage of marketing costs comes under pressure.
Seasons
Responding to good and bad days
Within the ‘good’ seasonal months, there are always better and less converting days. Take swimwear. The months of January through June are the peak months for this, but would you think about buying swimwear on a day when it’s pouring rain? You’re more likely to think about it when nice weather is coming or