For any business, the challenge of effectively allocating marketing budgets is critical. With various strategies like inbound marketing, account-based marketing (ABM), traditional advertising, and digital advertising options available to you, understanding and comparing their costs and effectiveness is key.
A Cost-Effective Long-Term Strategy
Inbound marketing attracts prospects and customers to your brand through content marketing, social media marketing, search engine optimization (SEO), and branding. This approach is a long-term investment, focusing on building relationships through relevant and helpful content. Despite potentially higher initial costs due to content creation and SEO, inbound marketing can be more cost-effective over time. LeadLander reports that inbound leads cost on average 61% less than outbound leads, making it a viable option for businesses seeking to establish thought leadership and a loyal customer base.
Account-Based Marketing (ABM)
High Investment, High Reward
ABM focuses resources on a set of target accounts within a market, using personalized campaigns. Although it requires a significant investment in technology and manpower, Adobe reported that 76% of marketers say account based marketing generates a greater ROI than any other marketing strategy. This makes it suitable for businesses with high-value products or services, high customer lifetime values, and those targeting a narrow and highly defined market segment.
Wide Reach at a Higher Cost
Traditional advertising uses channels like print, broadcast, television, radio, and direct mail. The costs vary widely, with TV ads ranging from thousands to millions of dollars. While costly, traditional advertising is effective for building brand awareness and reaching a broad audience, especially among demographics less inclined to digital mediums. It is a fitting option for businesses aiming for mass market penetration with a substantial marketing budget and typically those focused on a business to consumer market, rather than a business to business market.
Precision and Scalability
Digital advertising, including strategies like pay-per-click (PPC), display ads, and social media ads is known for its cost-effectiveness and measurable ROI. Businesses can start with a modest budget and scale based on performance, benefiting from precise targeting and real-time adjustments. Digital ad spending surpassed traditional ad spending and is expected to continue to grow at a rapid pace.
Cost Comparison and Effectiveness
A critical aspect of comparing these strategies is considering both direct expenses and potential ROI. Inbound marketing's long-term cost-effectiveness is contrasted with its initial, upfront time investment. In general, you should expect to spend in the realm of $3,000 to $12,000 per month on an inbound marketing campaign for your company (not including any additional software like HubSpot).
When you start to consider account based marketing, the range can get much bigger based on the target accounts that you're going after, their lifetime value, and tactics used within your campaigns. On average, you should expect to spend anywhere from $10,000 to upwards of $30,000 per month on a well developed account based marketing campaign including advertising spend (not including any additional software like Rollworks).
As mentioned before, traditional advertising can take on a life of its own and will vary very dramatically based on audience, medium, region, and audience. It can range from tens of thousands of dollars to tens of millions of dollars. The average Super Bowl 30 second spot is costing upwards of $7,000,000 alone.
Digital advertising can be very flexible and can be as simple (think boosting a post on Facebook) or as complex as needed. Through digital advertising platforms like Google search, Google Display Network, Bing search, LinkedIn, Meta, and Twitter, you can spend as much or as little as you like. Our recommendation is to plan to spend at least $3,000 per month per network. Less than that can give you misleading data and low returns. Digital advertising is also best utilized alongside an inbound marketing or account based marketing campaign.
Choosing the Right Strategy
The right marketing strategy for your company depends on your business goals, target audience, product/service nature, and budget. Inbound marketing is ideal for long-term growth and content creation; ABM suits high-value, specific target markets. Traditional advertising is beneficial for broad market reach, while digital advertising offers immediate, measurable results for those with limited budgets.
The decision between inbound marketing, ABM, traditional, and digital advertising depends on a lot of different factors — and honestly, it shouldn't always be one or the other of these options. Many of them complement each other extremely well and provide a seamless and cohesive experience for your audience. Think about your audience, where they spend their time, and what their value is to your organization. That should give you a good start toward choosing the right path or paths.