Phil Khor
Phil Khor Founder at

How much should you spend on social media marketing?

It would be interesting to hear what other businesses here spend on their social media marketing. Is it a significant figure, or is social media marketing more of a later add-on for your business?

Brad Lyons

Brad Lyons, Consultant at

Top 10% Ecommerce

To date we have spent nothing on social media and had very large returns. We have discussed on many occasion, the option of budgeting for paid ads however we have opted to remain focused on directly contacting our target markets ourselves.

I a lot of work was initially put into identifying where our potential customers are "hanging out" on social media then reaching out to them. I believe this would be more fruitful than paying for ads.

We have conducted some campaigns to help measure the success different types of contact with potential customers and seen a large range of variables. One campaign yielded around $120,000 for the month in revenue from one social media site using one form of marketing while other campaigns have been less successful and only yielded around $10,000 for the month. That being said even a bad campaign gave us a return. The only costs involved were time spend in preparation for the campaigns.

This is only based on what we have been doing and we will have to pay for advertisement on social media eventually in order for us to identify the best form of social media marketing. For all we know paying for ads could be the best way forward however the industry we used for this campaign was very niche resulting in a limited number of customers and places to find them.

I would say if you are looking at paid advertising solutions with social media, first ensure you know where the marketing should be directed and run some campaigns your self to gain a "Champion" then use the paid campaigns as your "Challenger". If you do I know a number of people on here (including myself) would be interested in knowing what your findings are. To pay or not to pay.

Philip Brookes

Philip Brookes, Director at

Top 10% Ecommerce

When you look at the question of how much you 'spend' on Social Media Marketing, you need to take into consideration direct advertising fees charged by the likes of Facebook and Twitter, as well as the cost of your own time or agency/consultant fees to strategise, manage, and maintain your social media marketing. We work with a number of clients who all have different circumstances, and their budgets differ significantly. Generally speaking, we advise that paid social media advertising (particularly Facebook and Twitter) can be highly effective for various industries/products/services and their respective target audiences. However, a lot of small businesses have very tight budgets - the beauty of paid Facebook and Twitter ads (and also Google Adwords/Remarketing) is that you can test the waters even with a tiny budget and use that as a guide to determine whether you're likely to get the ROI you're hoping for. Once you've proven that it's delivering value, it's a straightforward matter to start ramping up the budget as your circumstances permit. A lot of our small business clients build up to spending about $500 per month because (plus our fee for managing it). Larger companies will spend many times more than that - as long as it's generating a high ROI. As already stated by Brad Lyons, there are also numerous 'free' ways that you can promote yourself. In most cases, our clients consider a mix of both - the beauty of paid ads is that the results can begin virtually immediately, whereas many free channels take time to build momentum. There's also the question of how much time and resource (hidden cost) goes into a 'free' campaign. You will have to weigh up the relative priorities for yourself.

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