Do you want to start a business in Bali and need some insight on the operation costs? Or maybe you already have a business there and need help determining your marketing budget.
In any case, it’s good to get an idea of how much you should spend on marketing to avoid overspending and leaving no money for other aspects or spending too little and not getting the desired results.
So read on for our guide on determining the marketing budget for your Bali-based business.
Determining a budget for your digital marketing campaign depends on many factors, but your revenue and business size are the most important ones.
A general rule of thumb among businesses is to dedicate no more than 10% of your annual revenue to your digital marketing campaign.
But that’s where our second factor, business size, chimes in. New and small businesses need to spend more on their digital marketing campaigns to reach an audience. So if you fall into this category, you might have to pay up to 15-20% of your revenue on digital marketing.
Setting a marketing budget is difficult for any team leader, so let’s look at some methods for new and established businesses.
It’s essential to realize that newer and smaller businesses need to spend more on marketing than well-established ones to get their foot in the door. So, new and small businesses may need to spend up to 20% of their budget just in marketing.
You’ll also need to pinpoint your target demographic and the platforms where you can reach them. Social media and other online platforms offer advertising services at different costs. However, you probably won’t need to use them all.
There are also other costs you’ll likely need to cover (depending on the business), such as a website, content, graphics, photography, and software for each team. And each of these can cost hundreds or thousands of dollars a month, depending on your scale and who you’re hiring.
A common mistake among business owners and managers is pouring a lot of money into their digital marketing campaigns and expecting a return on investment without effort. And while this could get you more leads, you need to be smart about where your money goes and find ways to convert those leads into customers.
First, you should consider your annual revenue. A common tactic among businesses is to set a digital marketing budget as a percentage of yearly income as it’s sustainable and easy to calculate.
There’s no “Goldilocks zone” for what percent of your overall revenue you should set, but it’s still good to get some insight. The September 2022 CMO Survey asked 273 top marketers about their marketing budgets. The survey found the average marketing budget to be 8.7% of company revenue.
Another factor to consider is your business size. As mentioned above, smaller businesses need to spend more on marketing than their established competitors. So if your company is smaller, you might have to pay around 15% of your revenue on marketing.
Did you know that platforms change their advertising prices depending on where you are? Fortunately, the cost of advertising in Bali is on the lower end of the spectrum when compared to other big markets in America, Europe, and Australia.
Bali also has a great demand for businesses in various industries such as tourism, hospitality, retail, restaurants, beauty services, and many more.
As such, you can reach a broad audience in Bali at a relatively low cost. And with the right strategy and service, you’ll see a good return on investment.
In terms of numbers, the cost of advertising will vary greatly depending on the types of ads you’re using (static posts, videos, etc.), your target audience, your business type, and more. But in general, you can expect to pay between $0.4─$4 per click, which amounts to IDR6,000─IDR60,000.
Google is the king of advertising and the most visited online platform. You can choose its AdWords tool to advertise on Google search results, Maps, Display, Play, and YouTube, the last of which has its own massive audience.
The cost of ads on Google varies greatly depending on the industry, trends, and target audience, but you should expect to pay just for the actual clicks you get; the cost per click usually starts from $2. Google also allows you to set a daily budget, so you won’t spend too much all at once.
Facebook is the largest social media platform, with nearly 3 billion monthly users and a sizable portion in Indonesia as well. Advertising on Facebook is automatic for almost any business because of its breadth.
Facebook also lets you decide your daily budget based on the expected audience reach and time your ads will be live.
Since Meta owns Instagram, the advertising options are the same as Facebook’s. When setting up your account, you can even choose to advertise on both platforms simultaneously. However, Instagram’s users tend to be younger, so it’s best to use it singularly if your product caters to this demographic.
TikTok has seen an unprecedented boom in popularity over the last few years, especially among younger people. It’s good for advertising because you’ll reach a wide audience. However, ads are easily skippable with a simple scroll, so your best chance on it is if you can be creative and catchy with your content.
According to BusinessofApps, the average minimal spend per ad campaign is $500.
LinkedIn is the social media of the professional world. It may not have as large an audience as Facebook or Instagram, but it’s great if you want to publish ads targeting people in certain professions or advertise a B2B service.
Like for Meta and Google, the cost of your ad campaign will depend on your target audience and the price your competitors in the industry are willing to pay for the same ads.
Digital marketing is essential for any business. Fortunately for Bali-based business owners and managers, this rich province offers a huge marketing potential for companies in many industries at a lower cost of advertising than in America, Europe, or Australia.
However, you must implement a smart budget strategy, considering the cost of advertising on the digital platforms your potential customers use the most to survive the fierce competition in Bali.