Marketing and sales in the manufacturing sector has changed. If you’ve been in the industry for 10 or more years, you’ve likely experienced the significant shift.
One of the biggest changes is customer sales contact. Today, by the time anyone in your company has had the chance to talk to prospects they already know exactly what they want: Customers are self-educated about products, solutions and purchases.
Where are prospects learning so much? From the volumes of content available to them online from your competitors and industry organizations.
To understand the scope of this issue, CEB Marketing Leadership Council and Google surveyed more than 1,500 customer contacts (including decision makers and purchase influencers) for 22 large B2B organizations (from all major NAICS categories and 10 industries). The survey found that buyers are 57 percent of the way through the buying cycle before ever contacting a vendor. At the upper limit, it runs as high as 70 percent.
Today’s educated B2B prospects are doing Web searches, browsing company websites and social networks, and comparing suppliers to learn technical specifications, build requirements lists, form opinions and narrow their options—before speaking to sales reps.
Reality Check: Becoming a Proactive Inbound Marketer
This is not a trend. It’s the new reality. Many manufacturers have noticed the shift. According to the Thomas Net Industry Marketing Barometer, 62 percent of manufacturing companies say their websites have more impact than any other business-building tactic, online or offline.
To succeed in this new marketing and sales paradigm, manufacturers need to become proactive participants, so they can influence potential customers early in the educational process. In fact, many manufacturers already are making the shift from traditional outbound techniques to inbound strategies and tactics to generate and build leads and nurture new prospects. This includes everything from creating high-impact content that guides prospects down the sales funnel to analyzing results and adjusting their processes.
Faced with launching inbound marketing programs, manufacturers often ask: How much will this cost? It’s a good question, because the right budget is critical to making inbound effective, as well as getting C-suite buy-in.
To give marketers in the manufacturing world a starting point for setting an inbound marketing budget, this post provides an overview of benchmark expenses in a typical inbound marketing program.
Considerations for a Manufacturer’s Inbound Marketing Budget
Determining how much money your company should budget for your inbound marketing budget depends on several factors, including:
Your organization’s business model
The level of competition in your category
Your current marketing systems and assets
Your past success with inbound marketing
Your organization’s growth goals
The following four budget considerations will help your manufacturing organization gain a general idea of how to set your manufacturing company’s inbound marketing budget.
Budget Consideration 1—Industry Benchmarks
Benchmarking is a great place to start for creating your inbound budget. And benchmarking will help you make sure you aren’t too much or too little.
The average budget for digital marketing alone in U.S.-based companies with more than $500 million in annual revenue was about 2.5 percent of revenues, according to a 2012 Gartner Research survey of marketing executives. Meanwhile, according to Caron Beesley on SBA.gov, businesses generating less than $5 million in revenue should spend 7 to 8 percent of their revenue on their entire marketing program.
General Budget Benchmark: Based on Gartner’s average, if your company generates $5 million in revenue, you should be spending no less than $125,000 on digital marketing. Meanwhile, a good benchmark for your entire marketing budget should be in the $350,000 to $400,000 range.
Budget Consideration 2—Inbound Sales and Marketing Software
Today’s serious inbound marketers rely on the power of an inbound sales and marketing program to manage all of their email marketing, social media publishing and monitoring, Web analytics, landing pages, content management, blogging and more. HubSpot is one of today’s leading inbound software systems.
HubSpot offers a basic package for $200 a month, a pro package for $800 a month, and an Enterprise package for $2,400 a month. The Pro level gives companies access to all of the core inbound marketing tools and a significant number of contacts. The Enterprise package provides all of the capabilities in the Pro package, as well as advanced testing and reporting tools.
HubSpot also offers optional add-ons, such as Sidekick. As of September 2015, all HubSpot customers now also have access to HubSpot’s new CRM system at no additional charge.
Along with the software, to keep your inbound pipeline active, you will probably need at least one full-time marketing technologist to handle marketing automation and CRM, and one Web designer/developer to keep the website up to speed.
Software and Staff Budget Benchmark: $10,000 to $15,000 per month for best results, depending on the software package and average salary of a Web designer/developer.
Budget Consideration 3—Content Creation
While every inbound marketing strategy requires a unique mix of tactics and different levels of investment, there are a number of foreseeable line items that you must work into your budget—including content creation. In fact, content is famously referred to as the “king” of inbound marketing, because content is central to the critical educational aspect of inbound. Your inbound success depends on the quality, targeting, relevance and persuasiveness of your content.
Every inbound marketing campaign needs several types of content designed for the four stages of the sales funnel. This content may include:
Blog posts
eBooks
White papers
Infographics
Landing pages
Emails
John Deere is a great example of a manufacturing company creating compelling, educational content to drive its inbound marketing program. Deere consistently creates new content to attract new prospects, such as an infographic on its history of innovation, videos and images on Facebook, and its MachineFinder blog.
Once you’ve determined your content strategy, you need a team of content creators—including writers, graphic designers and social media pros to maintain a consistent flow of content for every stage of your sales funnel, including demand generation and lead nurturing content.
Content Budget Benchmark: $5,000 to $10,000 per month for sustained growth; $10,000 to $15,000 per month for aggressive growth.
Budget Consideration 4—Paid Content Distribution
If content is king, then content distribution is queen, according to the oft-quoted inbound marketing concept. Distribution is the outbound part of inbound marketing, where you reach out to people who aren’t already in your contact database.
The inbound way of doing demand generation is to attract people to download content at the top of the sales funnel, such as eBooks, white papers and free trial promotions. This category includes email marketing, PPC, social media advertising and native advertising.
What your manufacturing company spends to promote your digital content will depend on the channels you choose, and the frequency and reach of your promotions. Your channels will depend on your goals and where your audience goes for information. Options include Facebook, Twitter, Google AdWords, Bing and LinkedIn.
Distribution Budget Benchmark: $2,000 to $5,000 per month for sustained growth; $5,000 to $10,000 or more per month for aggressive growth.
Clearly, inbound marketing is critical for successful sales and marketing operations in today’s manufacturing companies. Your budget will reflect vital components of an effective inbound marketing and sales program. It will also reflect how important it is for your company to show up strong in the industry when consumers are in the educational stage of the sales process, how competitive you want to be, and how important it is for your company to build and retain customer mind share.
The bottom-line is to create an inbound marketing budget that helps your company reach your business and sales goals.