Multichannel Digital Marketing Strategy: How to Merge Ad Channels to Allocate Your Budget

In an ideal marketing world, customers always purchase when they see an ad for a product or service. Unfortunately, this happens in fairy tales or with the perfect marketer no one has ever seen.

In reality, people prefer to conduct their own product research before buying, and research shows that it takes from six to eight touchpoints to generate a lead. Of course, using many devices is convenient for users, but it creates many difficulties for marketers.

In this article, we consider what multichannel marketing is, how to analyze users’ interactions with digital advertising, and how to correctly allocate marketing budgets across channels.

Note: Originally published in July 2021, this post has been thoroughly updated in September 2024 to ensure accuracy and comprehensiveness regarding marketing analytics.

The purpose of any marketing strategy is to ensure users’ movement along the sales funnel, bring qualified leads for defined products or services, and increase the conversion rate throughout the customer lifecycle.

Today, marketers are forced to keep pace wherever customers operate:

• Online: Search engines, voice search, social networks, websites, mobile apps, email, chatbots, games, etc.
• Offline: Newspapers, journals, TV, radio, and more

As you can see from the infographic above, people get brand information from literally everywhere. That’s why marketers use multichannel digital strategies to ensure their brands are present in customers’ lives.

However, simply showing everyone the same advertising is ineffective. Companies must provide relevant product information to their target audience on a particular device and right when customers need a particular product. Marketers around the world share the same challenge: ensuring a seamless customer experience through various touchpoints, enriched with customized engagement based on a user’s earlier actions.

If you don’t want to turn into a crazy octopus trying to reach out to everyone everywhere, you cannot do without marketing analytics. Introducing a marketing budget breakdown can help allocate resources efficiently and avoid common pitfalls in budgeting.

The pandemic has sped up how businesses go global and digital. Nowadays, it's super important for companies to quickly adjust to new situations and figure out what's working, what isn't, what needs a change, and what should be dropped completely.

A Multi-channel marketing strategy is ideal for businesses seeking to optimize their audience reach and interaction across multiple platforms. Here are key points highlighting the types of businesses that benefit the most:

• E-commerce and Retail: Enhances customer touchpoints through online, mobile, and physical store channels.
• B2B Companies: Expands reach to different industry sectors and professionals across platforms like LinkedIn, trade publications, and email.
• Service Providers: Increases visibility across different demographics and regions through targeted social media, email marketing, and SEO.
• Technology Firms: Leverages specialized platforms for demos, webinars, and tech forums to engage potential clients.
• Entertainment and Media: This industry utilizes a mix of social media, streaming platforms, and traditional media to promote content and events widely.

Businesses that thrive on broad customer demographics, have diverse product lines, or aim for broad market penetration stand to gain significantly from a multichannel approach, maximizing exposure and interaction opportunities with their target audience.

Effective marketing initiatives are crucial for assessing and managing the success of these strategies, ensuring optimal resource allocation and alignment with business priorities.

An intricately designed digital marketing strategy is essential for businesses striving to excel in the digital realm. It offers several key advantages that can significantly contribute to the growth and success of a business. Here are some of the main benefits:

This marketing empowers businesses to target their audience with precision, leveraging demographics, interests, behavior, and other factors. This ensures that marketing endeavors resonate with individuals most inclined towards the products or services offered, thereby enhancing the effectiveness of multichannel marketing campaigns.

This marketing often proves significantly more cost-efficient than traditional marketing approaches, yielding superior return on investment (ROI) by effectively managing marketing costs. It enables businesses to engage a broader audience at reduced expenses, particularly through channels such as social media, email marketing, and SEO.

This marketing empowers businesses to monitor and analyze the performance of their campaigns instantly through tools like Google Analytics. This data-driven approach enables the refinement of strategies to enhance both performance and return on investment (ROI).

These marketing channels facilitate increased audience engagement through interactive and engaging content. Platforms like social media allow businesses to interact directly with their customers, building relationships and fostering loyalty. With the growing importance of social media marketing, brands are increasingly shifting their budgets from traditional search advertising to social media to align with changing consumer behaviors and preferences.

This marketing strategy can be easily adjusted or pivoted based on performance data or changing market conditions. This flexibility ensures that marketing efforts remain effective and relevant over time.

By directing targeted traffic to optimized landing pages, digital marketing can significantly improve conversion rates. Successful digital marketing strategies guarantee that a higher number of visitors undertake the intended action, whether it's making a purchase, subscribing to a newsletter, or completing a contact form.

The internet's global nature allows This marketing campaign to reach audiences worldwide with minimal additional effort or cost. This particularly benefits businesses looking to expand their market or reach a global audience.

These marketing tools and analytics furnish businesses with invaluable insights into customer behavior and preferences. Leveraging this information enables the customization of marketing strategies and product offerings to more effectively address the needs of the target audience.

A strong digital marketing plan includes SEO strategies that enhance a business’s website's visibility in search engine results. This not only increases traffic but also contributes to brand credibility and authority.

Digital marketing enables businesses to stay abreast of and adapt to the latest industry trends, technologies, and consumer preferences. This flexibility ensures that businesses stay competitive and pertinent amidst the swiftly evolving digital terrain.

In summary, a well-crafted digital marketing plan leverages the power of the internet and technology to achieve marketing and business objectives efficiently and effectively. It's an essential component of a modern business strategy, driving growth and enhancing competitiveness in the digital age.

A marketing budget is a comprehensive plan detailing the financial resources dedicated to a company's marketing efforts within a specific timeframe, usually a quarter or an entire year.

The budget includes various expenses such as:

• Paid advertising
• Sponsored web content
• Hiring new marketing staff
• Maintaining a registered blog domain
• Investing in marketing automation software

A well-structured marketing budget is crucial for achieving a company’s marketing goals and objectives, as it ensures that resources are allocated efficiently and effectively.

By meticulously planning and managing a marketing budget, companies can strategically invest in activities that drive growth, enhance brand visibility, and ultimately contribute to the bottom line.

Whether it’s launching a new product, entering a new market, or simply maintaining a competitive edge, a comprehensive marketing budget serves as a roadmap for all marketing efforts.

Determining the ideal marketing spend can be a complex task, influenced by various factors such as industry norms, company size, and specific marketing goals. Generally, companies allocate between 7% to 10% of their overall revenue to marketing activities. However, this percentage can vary significantly based on the company’s growth stage and market conditions.

According to a recent Gartner CMO survey, marketing budgets as a proportion of company revenue decreased to 7.7% in 2024, continuing a downward trend from previous years. This decline highlights the need for companies to be more strategic in their marketing spend, ensuring every dollar is used effectively.

A useful guideline to follow is the 70-20-10 rule:

• 70% of the budget should be dedicated to core marketing activities that drive the majority of results.
• 20% should be allocated to growth initiatives that have the potential to scale and bring in new opportunities.
• 10% should be reserved for innovative experiments that could lead to breakthrough results.

By adhering to this rule, companies can balance their marketing spend across essential activities, growth opportunities, and innovative experiments, ensuring a well-rounded approach to their marketing strategy.

Defining clear marketing goals is a fundamental step in creating an effective marketing budget. These goals should align with the company’s overall business objectives and be specific, measurable, achievable, relevant, and time-bound (SMART).

By setting SMART goals, companies can ensure their marketing efforts are focused and measurable, making it easier to track progress and adjust strategies as needed.

Examples of marketing goals include:

• Increasing Brand Awareness: Enhancing the visibility of the brand through various channels such as social media, content marketing, and public relations.
• Generating Leads: Attracting potential customers through targeted campaigns, lead magnets, and optimized landing pages.
• Driving Website Traffic: Increasing the number of visitors to the company’s website through SEO, paid advertising, and content marketing.
• Boosting Sales: Converting leads into customers through effective sales funnels, email marketing, and personalized offers.

By setting clear marketing goals, companies can allocate their marketing budget more effectively, ensuring that resources are directed towards activities that drive the most significant impact. This strategic approach not only enhances the efficiency of marketing efforts but also provides a clear framework for measuring success and making data-driven decisions.

An effective multichannel marketing plan incorporates several critical elements to seamlessly integrate various communication channels for optimal customer engagement and achievement of business objectives. Here are the essential components:

• Objective Setting: Define clear goals for leads, sales targets, and customer engagement specific to products or services applicable to the organization or individual markets.
• Audience Understanding: Segment the target audience to tailor messages effectively across different channels.
• Channel Selection: Identify and leverage a mix of channels (e.g., websites, email marketing, physical stores, TV, text messaging, blogging, direct mail) best suited to reach and engage the target audience.
• Content Strategy: Create a strategic content roadmap that follows the customer journey, maintaining uniform and tailored communication across selected channels.
• Budget Allocation: Allocate resources efficiently across channels to maximize impact, considering both online and offline avenues. Using a budget template can help marketers organize and track their expenses effectively, ensuring no costs are overlooked during the budgeting process.
• Integration: Ensure cohesive branding and messaging across channels for a unified customer experience.
• Execution Plan: Outline timing, frequency, and specifics of content distribution across channels.
• Measurement and Optimization: Set Key Performance Indicators (KPIs) to measure success and apply insights to optimize future multichannel marketing campaigns.
• Technology and Tools: Utilize appropriate tools and platforms to manage, execute, and track the effectiveness of marketing activities across channels.

This strategic approach enables marketers to plan, manage, and optimize marketing resources effectively, ensuring a cohesive and engaging customer experience across all channels, ultimately driving leads and sales targets.

An effective multichannel marketing plan is essential when aiming for a cohesive customer experience across various channels. This should be implemented when organizations aim to unify online and offline marketing endeavors, guaranteeing that campaigns are harmonized and customer-focused across all interaction points.

This strategy becomes critical in today's customer-driven buying process, enabling an 'always-on' approach to cater to customer preferences, whether through inbound or outbound channels. By effectively integrating multichannel marketing, businesses can enhance visibility, generate leads, and increase conversions, thereby optimizing the customer journey from engagement to sale.

In constructing a multichannel marketing plan, several crucial components should be incorporated to ensure its effectiveness and adaptability across various customer interaction points:

• Creation of Comprehensive Customer Profiles: Develop in-depth profiles that reflect your audience’s preferences and behaviors to tailor communications effectively across selected channels.
• Establishment of SMART Goals: Define specific, measurable, achievable, relevant, and time-bound objectives focused on customer acquisition and retention.
• Strategic Marketing Approaches: Implement marketing tactics that emphasize content marketing with an inbound methodology, aiming to attract customers through value-driven content.
• Selection of Integrated Communication Channels: Choose various communication channels, ensuring they work cohesively across multiple platforms and devices to engage customers effectively.
• Measurement and Analysis of Multichannel Performance: Employ metrics to evaluate the impact and success of marketing efforts across channels, focusing on effectiveness, reach, and contribution to goals.
• Adaptability and Continuous Optimization: Recognize the dynamic nature of customer movement across channels by continually adapting strategies and analytics to capture and respond to these shifts.

Understanding which campaigns and channels contribute most significantly to sales allows for optimizing marketing activities and better-allocating resources, enhancing overall return on investment (ROI).

This multichannel approach ensures that a multichannel marketing plan remains flexible, targeted, and aligned with changing consumer behaviors and preferences.

Additionally, a comprehensive digital marketing budgeting strategy should be implemented to account for all potential marketing costs, avoiding future financial surprises.

If you want to keep your hand on the pulse and monitor the overall status and progress of advertising campaigns, you need to collect and analyze marketing data. Effective digital marketing budget allocation is crucial for strategically distributing financial resources across various channels for successful marketing campaigns.

What you get with data-driven marketing:

• A complete overview of all advertising channels: the effect of each channel on conversions and, accordingly, on revenue
• Various cohort reports are used to make decisions on budget redistribution, audience segmentation, funnel assessment with the AIDA formula, etc.
• Hypothesis testing: new positioning, setting up ads for another audience, and so on

The ability to respond to problems before they become critical

Optimize your marketing budget based on the objective sales contribution of each advertising campaign with the help of business intelligence (BI) tools. OWOX BI shows a channel combination for different types of customers, as well as areas where you can grow your multichannel marketing strategy.

High demands and expectations and, of course, instant results for customers require informed decisions and actions based on specific data. Let’s look at exactly what data-driven marketing is and how a data-driven marketing strategy can help your brand achieve its business goals.

To take full advantage of data-driven marketing, you need to set up advanced analytics. Let’s take a look at what steps you should take, regardless of the size of your business and the niche you work in.

The most crucial step is collecting data. Because if you don’t collect all the data, or you collect the wrong data, you’ll take action based on faulty information (marketers waste 21% of their marketing budgets because of bad data).

You need to collect all possible data in one place (cloud data storage is ideal) and normalize this data (bring it into a single structure and format). You can obtain data from sources such as:

• Google Analytics 4
• Your website and mobile app
• Your CRM system
• Advertising platforms like Facebook, Instagram, and Twitter

Note! We believe that Google BigQuery is the most appropriate data storage option for marketers.

Merge the data collected from multiple data sources so it’s ready to create reports. You have to blend data to get a clear overview of the ROI to identify underperforming platforms and reallocate the budget.

Note! Data blending typically requires analysts to use SQL queries. However, marketers don’t always have time to wait for an answer and schedule a time slot with a team of analysts. That’s why the OWOX BI platform automatically merges and processes the data a marketer needs, so you can easily set up advanced analytics and get any reports.

Though you can evaluate user behavior by looking at columns of numbers collected in datasets, how many insights can you get at one glance? To monitor and compare data for different periods, you need to visualize the data.

Maybe you’ll need to view different variations of reports and build several ad-hoc reports. The good news is that earlier, an analyst was required to complete these tasks, but now OWOX BI has made it possible for every marketer to do so.

You no longer have to wait for reports from an analyst, switch between reports, or manually merge data to compare the effectiveness of ad campaigns. With OWOX BI, you can free up the time you spend preparing reports for more crucial tasks.

As you can see, to make informed decisions, businesses need to take three simple steps in setting up advanced analytics. Of course, if you do it all manually, you’ll spend all your resources on collecting and visualizing data and nothing more. However, what’s really important is that data works for you and benefits your company.

Simply put, you need marketing automation! Martech platforms allow specialists to focus on the essentials: finding powerful insights from data and avoiding the routine work of collecting and uploading data. With bespoke options for small and large businesses alike, there are solutions to help you achieve your goals.

After obtaining high-quality marketing data, you have all you need to define a more profitable digital marketing budget allocation. And assessing advertising campaigns is quite impossible without marketing attribution.

When a marketer faces the challenge of attracting a certain number of conversions without exceeding the budget, they must make sure the attribution model they apply helps them make the right decisions and understand the model’s logic.

Understanding how to allocate a budget for digital marketing is crucial as digital advertising expenditures continue to grow and marketing strategies evolve.

It’s important to mention that paid managed traffic channels (PPC) usually occupy up to 30% of the marketing budget. And don’t forget that no machine learning technology will be able to make a decision and allocate the budget in place of a marketer. When expert management is required, only a person can make the final decision.

Marketing specialists have the whole picture in their heads, and for management solutions to be sound and balanced, BI services such as OWOX BI provide reports of all possible kinds (performance, cohort, RFM, ROPO, etc.).

With the help of marketing reports, you can review the performance of various segments: channels, regions, product groups, new users, returning users, different cohorts, mobile and desktop visitors, etc.

This approach will give you an idea of what to do next and help you assess the impact of various parameters on achieving your KPIs.

Understanding how to allocate marketing budgets across channels is essential for making strategic spending decisions.

The essential data you need to allocate your budget correctly includes:

• Touchpoints that had the highest returns and where you need to invest more in the future
• All channels where you met defined goals
• All areas where your strategy led to wasting money without any positive impact on your business

Things to do when setting aside a budget:

• Consider your business and marketing goals
• Evaluate your recent marketing efforts
• Research where your competitors are
• Determine the size of your budget
• Allocate, track, and optimize

Knowing which campaigns on which channels have led to most sales will enable you to establish the success of your activities. Customers move across channels quickly, and therefore both your strategy and analytics should simultaneously adapt.

If you don't rely on data, there's a reasonable chance your business venture will end in bankruptcy, so you need an analytical ecosystem.