We publish the latest news and analysis to keep our readers up to date. The day's top stories will be delivered to your inbox if you sign up here.
Analyzing marketing spend data is important for any business, as procurement professionals and marketing teams can derive benefits from knowing how much they spend on advertising and marketing.
Companies can make better financial decisions by managing their marketing spend. Knowing how much money is allotted to different areas of a marketing campaign will allow the company to spot where the money should be spent.
Marketing spend analysis can be used to improve spending. The marketing plans that deliver the most value are developed by it.
There is a guide showing how to perform a marketing spend analysis.
What Is Marketing Spend?
The marketing spend is the amount of money spent on marketing.
Advertising, public relations, and promotion are included in the marketing budget. The budget is based on the size of the business, the amount of advertising it spends, and the amount of competitors spending. The marketing budgets can range from low to high.
There is a marketing budget.
- website development
- print and digital advertising
- design and printing costs for any print materials such as press releases
- trade shows
- any other ad spend and services
Marketing expenditure is a term used to describe the management of marketing spend. Money used on specific campaigns may be included. The costs for advertising operations personnel and advertising agencies as well as the cost of the campaign placement can be calculated.
How to Conduct Marketing Spend Analysis
A spend analysis is a tool used by companies to increase profitability, reduce inefficiencies, and improve supplier relationships. Marketing teams use spend data to identify spending areas that have a significant impact on profits.
Dedicated software is used to collect, cleanse, classify, and examine spend data. The process helps find wasteful spending and contracts that can be changed.
Marketers can develop a go-to-market strategy with a complete view of what they are spending.
Identify Multiple Data Sources
An overview of what spend sources will be covered is the first step. It is possible to identify multiple data sources in the analysis.
The best way to conduct this analysis is to segment advertising spend into different groups and then establish all the spend data sources.
Review Historical Data
There should be a review of historical spend data to find potential errors. Identifying and eliminating errors in accounts and transactions is a part of this process.
The spend data can be organized into a database once identified and reviewed by the marketing team. It can be difficult to collect data into a single database due to it being in different formats. This step can be made easier with the use of spend analysis software.
The categories can be identified. The categories should be focused on advertising. Marketing software can be grouped together.
Data normalization is when spend data is joined into clearly defined categories. Visibility into a company's spending is created by classification.
Analyze the Marketing Budget
The marketing budget needs to be analyzed to get a clear picture of opportunities for saving and how the supply chain can be improved. It is possible to identify better supplier rates with data analysis.
Measurement of traffic, conversion rates, and investment return are included in analyzing advertising results. The indicators are used to determine how well a campaign performs.
Make and Implement Saving Decisions
Saving and procurement decisions can be made after the spend analysis is complete. The data collected during the analysis can be looked at by marketers.
A new understanding of marketing buying decisions can be provided by the data from a spend analysis. Strategies that lead to savings and better advertising results need to be developed.
Saving decisions are made after a spend analysis is done and it is important to make sure they are converted into savings opportunities. A good spend management involves acting on a solution.
4 Benefits of Marketing Spend Analysis
There are different benefits to analyzing marketing spending.
1. Streamline Business Objectives
Estimating the expenses needed to accomplish certain marketing objectives can be used to determine the marketing budget. Analyzing spend helps businesses understand how their marketing meshes with their goals.
A budget is used to define the needs of the company. The budget's effectiveness can be determined by monitoring marketing costs and results throughout the year.
2. Increase Efficiency
It's important to identify inefficiencies to improve marketing efforts. Deep data analysis is required. Creating a long-term partnership to streamline procurement is one of the benefits of strategic sourcing.
Spending analysis can help identify areas for savings.
3. Improve Visibility
A clearer idea of what drives sales versus what costs the business is formed when the marketing team cleans data. Regular analysis of the spending process guarantees that spending visibility improves.
When spend visibility is organized by category, purchaser, and supplier, it is more useful. Spending can be consolidated across different teams.
4. Gain Actionable Insights
Business units know the boundaries of their target market when analyzing spending. This information can be used by marketing and procurement teams to create actionable insights, such as altering prices, personalizing what platforms are being used, or enhancing customer reach.
Additional Insights on Spend Analysis
Wasan Tita's image was used.