How to Allocate Your Digital Marketing Budget

Prioritize Customer Retention and Expansion

Remember that your existing customers are a goldmine. As you navigate the rough waters of a recession, focus on deepening relationships with your loyal users. Allocate a significant portion of your marketing budget, usually between 30 – 50%, to strategies that create memorable experiences and turn your customers into advocates. Customize your email marketing strategy, create webinars, improve your onboarding process, collect customer feedback, and incentivize loyal customers.

To determine the appropriate percentage allocation for retention efforts, try to overcome SaaS customer churn. Think about how some of the top machine learning algorithms in SaaS marketing can help you. Consider factors such as your customer acquisition cost (CAC), customer lifetime value (CLV), and churn rate. The higher your CAC and churn rate, the more money you should invest in retention tactics. Additionally, benchmark your retention budget against industry standards and adjust based on your company’s specific goals and circumstances.

Leverage Data-Driven Marketing

Data science for digital marketing is your compass in the storm. Allocate resources to analytics tools and data-driven marketing strategies to uncover the most effective channels and campaigns. This approach will help you make more accurate customer lifetime value predictions in digital marketing. By making informed decisions, you’ll ensure that every dollar you spend brings you closer to your goals.

Diversify Your Marketing Channels


Don’t put all your eggs in one basket. Allocate your budget across a mix of channels to reduce risk and reach new audiences. Diversification will help you stay afloat when other businesses are sinking under the weight of single-channel dependency.

The specific budget split between channels will depend on your company’s goals, target audience, and resources. However, the following recommendations can serve as a general guideline for SaaS businesses.

Content Marketing: 25-35%

Investing in a high-quality SaaS content strategy can help generate organic traffic, educate prospects, and establish your company as a thought leader in your industry.

Search Engine Optimization (SEO): 15-25%

A strong SEO strategy is essential for driving organic traffic and increasing visibility. It is important to track the changes in SEO and constantly improve your approach. For example, the shift from a keyword-focused SEO to semantic SEO changed the approach to ranking well. Check out our actionable guide on how to use semantic SEO. Apart from on-page SEO and off-page optimization, invest in technical SEO to maintain your website’s health.

Social Media Marketing: 10-20%

Social media is an excellent platform for engaging with your audience, sharing content, and generating leads. Allocate more budget to platforms where your target audience is most active and follow the steps of our social media advertising guide.

Pay-Per-Click (PPC) Advertising: 15-25%

PPC can generate immediate results and help your business scale quickly. Consider these 4 simple steps to calculate your PPC budget if your target keywords have high commercial intent or if your organic reach is limited. Here are some of our actionable PPC tips to help you design a winning strategy.

Influencer Marketing: 5-15%

Influencer marketing can help you reach new audiences and build credibility. For example, finding the right influencers is an important step in creating a TikTok marketing strategy. The budget allocation will depend on the cost of partnering with influencers in your industry and the potential ROI.
Email Marketing: 10-20%

Email marketing remains a cost-effective channel for nurturing leads and engaging with customers. Allocate resources to develop targeted campaigns, improve deliverability, and optimize open and click-through rates.

Emphasize ROI and Accountability

Hold yourself accountable for every marketing dollar you spend. Allocate resources to campaigns and strategies that have a proven track record of success, and continually optimize your efforts based on performance data. Apart from calculating the ROI, you can also measure your performance in a better way by understanding how to use attribution models. This is how you’ll ensure that your marketing budget delivers the best possible return.

Analyze customer data to identify distinct segments based on demographics, behavior, or product usage patterns. This will enable you to create targeted marketing campaigns that resonate with each segment and yield better results.

Use predictive analytics tools to forecast customer behavior, identify high-value prospects, and estimate the potential return on investment (ROI) of various marketing initiatives. This can help you allocate your budget more effectively and reduce wasteful spending.

Invest in Brand Building

Your brand is the lighthouse that guides customers through the fog. Allocate a portion of your marketing budget to brand-building initiatives that increase brand awareness, credibility, and customer loyalty. A strong brand will help your SaaS business stand out in a crowded market and create long-term value. An excellent example in building brand awareness is ClickUp and their successful video marketing strategy. If you don’t know where to start from, we have created a guide with examples on how to build brand awareness.

Navigating a recession is no small feat, but with the right mindset and a strategic approach, you can maximize the impact of your digital marketing budget. By focusing on customer retention, data-driven marketing, channel diversification, ROI, and brand building, you’ll not only weather the storm but emerge stronger and more resilient than ever. Remember, the key to success lies in your ability to adapt, innovate, and stay true to your core values. Now, go forth and make your mark on the SaaS world!

If you want to learn more tips and tricks, check out our podcast episode on what it takes to build a SaaS brand and maintain its success!

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