Begin by determining your daily budget. For example, if your monthly budget is $2,000, your daily budget would be $66 per day across the entire account.
This daily budget will also affect how many campaigns you can run simultaneously, as the $66 will be distributed across all campaigns. This can be a challenge for SMBs with a small PPC budget.
Keep in mind that both Google Ads and Microsoft Ads may occasionally exceed the daily budget to maximize results, but your total monthly spend should not exceed the daily budget multiplied by the number of days in the month.
AI Features For Budget Management
AI and automation can help make budget management easier. Here are a few key features that can simplify the process:
Smart Bidding: Automatically adjusts bids to maximize conversions or achieve a target return on ad spend.
Budget Recommendations: Many ad platforms provide budget suggestions based on historical campaign performance and goals.
Performance Max Campaign: Uses AI to optimize budget allocation across all of Google’s ad inventory (search, display, YouTube, etc.) to maximize conversions.
Target CPA: Automatically adjusts bids to help get as many conversions as possible at your set budget and desired CPA.
Target ROAS: Optimizes bids to get the most conversion value for your budget.
Looking To The Future Of PPC Budget Management
SMBs can expect to see some key developments in PPC budget management as the digital advertising landscape evolves. A few notable trends to keep an eye on:
Increased Automation And AI-Optimization
More advanced AI-powered tools will be released, enabling real-time adjustments to bids, budgets, and campaign strategies based on performance data. This will allow for greater agility and efficiency in budget management.
Focus On Lifetime Value (LTV)
Think about allocating budgets based on long-term profitability and customer retention, not just immediate acquisition costs. This will require sophisticated attribution modeling and AI tools.
Alignment With Broader Goals
PPC budget management is becoming more closely tied to overall marketing strategy and business objectives, driving greater cross-functional collaboration on budgets and spend.
By staying ahead of these emerging trends, SMBs can future-proof their PPC budget management. The flexibility and insights provided by these trends will be key to staying competitive.
Three Examples Of Budget Allocation For Paid Media Campaigns
These examples demonstrate how to allocate a paid media budget across various platforms, for example, industries, target audiences, and goals.
While these allocations provide a starting point, it’s important to remember that budget splits should be customized based on individual research, campaign needs, and past performance data.
The ratios suggested here are examples designed to illustrate how thoughtful planning can improve results.
Often, businesses split their budget evenly across platforms or prioritize a single platform like Google, then allocate a smaller amount to others.
Research and strategic planning based on platform reach, audience demographics, and campaign types available will ultimately drive the budget allocations.
Each scenario provides guidance that SMBs can easily apply to their own campaigns.
To maximize effectiveness, run a four- to six-week test, monitor performance, and adjust your budget allocation based on which platforms deliver the best.
1. B2B Product With $10,000 Per Month
For B2B companies, it’s important to prioritize platforms that effectively target professionals and decision-makers.
Here’s a recommended budget allocation for a $10,000 per month budget with platform rationale.
LinkedIn Ads: 40% ($4,000)
LinkedIn is the leading platform for B2B targeting, allowing precise targeting by job title, industry, and company.
Despite its higher cost per click, LinkedIn generates high-quality leads and builds thought leadership, making it essential for B2B campaigns.
Google Ads: 35% ($3,500)
Google Ads remains critical for capturing high-intent search traffic from B2B buyers actively seeking solutions.
This allocation focuses on search ads to ensure visibility for potential clients looking for specific products or services.
Microsoft Ads: 25% ($2,500)
Microsoft Ads offers a cost-effective way to target professionals, particularly through Bing.
It’s especially valuable due to its integration with LinkedIn data and less competitive ad space, which helps maximize ROI at a lower cost than Google.
2. Consumer Product (Auto, Recreational) With A $20,000 Budget
When marketing consumer products like cars or similar, visual platforms play a key role in storytelling and engaging potential buyers.
Here’s a budget split for a $20,000 monthly budget:
Google Ads: 40% ($8,000)
Google Ads is essential for capturing high-intent search traffic, especially from car buyers researching models and dealerships.
Both search and display ads ensure visibility throughout the buyer’s journey, from discovery to conversion.
YouTube Ads: 30% ($6,000)
YouTube’s video ads are ideal for showcasing cars through immersive content like test drives, feature highlights, and lifestyle storytelling.
This platform builds brand affinity by engaging consumers through compelling visuals.
Pinterest Ads: 15% ($3,000)
Pinterest excels at visual storytelling, making it perfect for engaging users during their discovery phase.
It helps inspire potential car buyers and captures users exploring future purchases, making it an effective top-of-funnel platform.
Microsoft Ads: 15% ($3,000)
Microsoft Ads offers a cost-effective way to reach an affluent, mature audience on Bing.
It complements Google Search by capturing additional leads at lower CPCs, particularly for big-ticket items like cars.
3. Ecommerce (Home Goods Retail) With A $30,000 Budget
For ecommerce businesses selling home goods type products, a balanced approach across search, social, and visual platforms ensures both discovery and conversion.
Here’s a suggested budget split to get started for a $30,000 monthly budget:
Google Ads: 35% ($10,500)
Google Ads is critical for capturing high-intent traffic through search and shopping ads.
Given a higher retail average order value, search ads target ready-to-buy consumers, while Google Shopping Ads showcase products with pricing and visuals, driving qualified traffic.
Meta Ads (Facebook & Instagram): 35% ($10,500)
Meta Ads are perfect for visually appealing home goods, using Facebook and Instagram’s dynamic ad formats to engage consumers.
Meta combines discovery, engagement, and direct conversions, reaching a broad but relevant audience of home decor enthusiasts.
Pinterest Ads: 15% ($4,500)
Pinterest is an ideal platform for home goods, where users often browse for home decor inspiration.
Pinterest Ads engage users at the discovery phase, driving top-of-funnel traffic with visually engaging content that inspires potential customers.
Microsoft Ads: 15% ($4,500)
Microsoft Ads complements Google with lower-cost clicks from Bing.
It helps target an affluent, purchase-ready audience and efficiently captures additional search-intent traffic, making it an excellent addition to your ecommerce marketing strategy.
Note: These suggested splits serve as examples to inspire a strategic approach to budget planning. These examples illustrate how to allocate your budget based on your target audience and campaign goals, ensuring that each dollar spent is driving results in the most thoughtful way.
Key Takeaways
Allocate Budget To Top-Performing Campaigns: Regularly analyze performance across platforms to focus your budget on campaigns that deliver the best results.
Reallocate Based On Actual Spend: Track your planned versus actual ad spending each month or quarter. Reallocate any unspent budget to the next month or high-performing campaigns to ensure efficient use of your resources.
ROAS And CPA: Use ROAS to measure how effectively your ads are generating revenue. Use CPA to control customer acquisition costs and optimize budget for growth.
Testing And Optimization: Begin with a four- t0 six-week test period to gather performance data and adjust your budget allocation based on which platforms and campaigns yield the best results.
Use AI Tools: Leverage AI features such as Smart Bidding and automated strategies to help manage budgets without constant manual adjustments.
More resources:
Featured Image: Vitalii Vodolazskyi/Shutterstock