How to Budget for Costs and Control Ad Spend
The mobile app industry generated more than 460 billion US dollars in 2019 and this trend shows no signs of slowing down. That said, many apps fail to make an impact and end up exiting the market due to low revenue and lack of funding.
In many of these cases, the effective implementation of advertising cost control at an early stage can mitigate a slow start and give app developers the boost they need to succeed. By using AppSimilar, companies can analyze their competitors’ weekly income and devise a cost control plan that allows them to get over the initial stages successfully.
Advertising cost control is not a new idea, but this concept has not been widely implemented in most verticals. Below, we’ll go over the definition of cost control in the advertising context, discuss its benefits, and examine effective ways to control ad expenses.
What is Advertising Cost Control?
In this context, cost control is the practice of creating a budget for advertising and monitoring your marketing campaigns to ensure you adhere to the financial plan. Also known as budgeting for advertising costs, this practice allows app developers and companies, in general, to create a predictable model, produce blueprints for different scenarios, and solve cash flow problems without generating profits during the initial stages.
Advertising cost control can take different shapes, but this practice requires a set of specialized tools that allow you to make accurate projections. ADCostly is a great example as this platform allows you to see the average range of key advertising-related costs. You can use this information to craft accurate cost control plans based on the formats and other elements you want to put in place.
Furthermore, budgeting for advertising costs also requires a reliable network that allows for the structured distribution of your budget, among other requirements.
The Importance of Advertising Cost Control
Like other forms of expense management, advertising cost control allows you to get the most out of your investment. Through this practice, you can increase the efficiency of your marketing structure, keep waste to a minimum, and allocate your resources in a way that gives you more freedom.
The development of a cost control protocol requires the creation of streamlined marketing processes, which often reduces errors and shortens turnaround. Managing your expenses also allows you to track every cent and ensure that your ads are optimized for performance. Finally, this practice can help design your budget in a way that provides financial stability even if you don’t see profits for the first few months.
How to Control Ad Costs Efficiently
Budgeting for marketing costs is a gradual process. Instead of looking at your entire marketing expenses, you can break down your plan into annual, quarterly, monthly, or even weekly projections.
As part of the process, you’ll also need to develop different areas of your marketing strategy in advance and make sure that your budget and advertising goals align at all times. By using ADCostly, you can view the average range of advertising costs for different industries, ad formats, locations, timeframes, and more.
In order to successfully budget your marketing costs, you need to:
1. Define the Target Audience and Create Buyer Personas
The first step is to define your target audience and create buyer personas accordingly. It’s important to find out demographic information about the consumers that are interested in the products being promoted. This includes:
- Age
- Gender
- Location
- Interests
- Marital status
- Employment and other relevant information
ADCostly allows you to view cost insight based on demographic information, including location data, age, interests, and other variants. After collecting the data via ADCostly, you can create multiple profiles of your ideal customers and use them to personalize ads based on their interests. This will help develop the right message in your creatives without having to run as many trial and error tests.
Keep in mind that including subjective information like personality traits and interests may result in better ads, but this information is generally harder to uncover.
2. Identify the Best Ads and Formats
While television, print, and other forms of traditional advertising remain effective for some verticals, app developers and small businesses as a whole need to embrace the power of the internet.
With this in mind, there are dozens of different channels and ad formats to choose from, so it’s crucial to identify the most effective combination for each project.
It’s worth noting that finding the best ad format will likely require multiple steps. ADCostly can help identify the best formats based on CTR, CPC, and CPM. Furthermore, marketers also need to test out new ad formats, placements, and creatives to assess their potential.
3. Determine How to Acquire the Target Audience
In this step, the most important factors you have to consider are the barriers that prevent consumers from purchasing the product being promoted. Now, think about the product features and characteristics that can be used to break down these barriers.
If unsure, try answering complex questions like:
- Are there any immediate needs or desires that the product can help fulfill?
- Does the product possess emotional or rational elements you can use to your advantage?
- How can you present these to your audience in an alluring and convincing way?
The answer to these questions will allow you to build a plan based on the different resources you need, thus giving you an accurate estimate of your total expenses. Likewise, ADCostly can tell you which formats have better CTR and CPC.
4. Calculate ROI and Similar Investment Metrics
Once you complete the first three steps above, it’s time to calculate the return on investment (ROI). ROI is one of the true ways to measure the performance of the marketing plan and it can be calculated in different ways depending on the company.
Whatever your choice may be, it’s imperative to develop an effective way to accurately forecast the amount of money you’ll receive for each dollar spent on advertising. ADCostly allows you to calculate the average advertising spend in your industry, which will give you a solid baseline for your projections.
With this information, you’ll be able to create a super advertising cost control plan that allows you to power through even if you have a tough start.
Learn More About Controlling Costs with ADCostly
ADCostly is an innovative platform that allows you to visualize the price of necessary marketing expenses. If you want to learn more about this platform, visit the ADCostly official website today.
