How to allocate budget across different media channels
Five common ratios that have been used as a starting point in the advertising industry
With the rise of digital advertising, the allocation of budget between traditional media (such as television, radio, print) and digital media (online display, social media, search engine marketing) has shifted.
A commonly used ratio is 70:30, where 70% of the budget is allocated to traditional media and 30% to digital media. However, this can vary significantly depending on the target audience and campaign objectives.
While there is no universally prescribed set of media planning ratios, here are some common ratios that we’ve been used as a starting point
Reach vs. Frequency
Reach refers to the number or percentage of the target audience exposed to the campaign, while frequency represents the number of times they are exposed to it.
The balance between reach and frequency depends on the campaign objectives, message complexity, and target audience. A typical ratio could be 70:30, prioritizing reach over frequency
Branding vs. Performance
Branding campaigns aim to create awareness and build a brand image, while performance campaigns focus on driving immediate actions and conversions.
The ratio between branding and performance depends on the marketing objectives and the stage of the brand’s lifecycle. For established brands, the ratio might lean toward branding (e.g., 60:40), while for newer brands or specific promotional campaigns, it could tilt toward performance (e.g., 40:60).
Offline vs. Online
This ratio determines the allocation of budget between traditional offline media channels (TV, radio, print, outdoor) and online channels (digital display, social media, search engine marketing).
The specific ratio can vary widely based on factors such as target audience demographics, media consumption habits, and campaign goals. In recent years, the trend has shifted toward allocating more budget to online channels due to their increased effectiveness and targeting capabilities.
Television vs. Digital Video
When it comes to video advertising, the ratio between traditional television and digital video channels can vary based on factors like target audience age, media consumption habits, and campaign goals.
For instance, if you’re targeting a younger demographic with heavy digital video consumption, you may allocate a higher percentage of the budget to digital channels (e.g., 60:40).
Paid Media vs. Owned Media vs. Earned Media
Paid media refers to advertising channels where you pay for exposure, such as display ads, paid search, and influencer collaborations. Owned media refers to channels that a brand owns and controls, like its website, social media profiles, and blog. Earned media refers to the exposure gained through word-of-mouth, shares, mentions, or media coverage.
The ratio between these three categories depends on the brand’s marketing goals and budget. It’s common to see a larger proportion allocated to paid media initially, but as a brand builds its owned and earned media channels, the allocation can shift over time.
In conclusion
These ratios can vary depending on various factors, including the target audience, campaign objectives, industry norms, and available resources. Also important to note that these ratios are not fixed and should be adjusted based on your specific campaign objectives, target audience, industry trends, and available data.
About Nasmedia
Nasmedia provides a differentiated service from other media agencies through its ability to analyze data and discover insights. Our services are based on ad tech solutions and ad content across various types of media. Our client can count on our expertise to help them reach the right target audience in any given market and deliver the most optimal results. We have accrued our expertise from planning to operating campaigns of industry-leading clients.
