Cost Breakdown: How Much Should Social Media Marketing Cost?

Millions of people across the globe are pinning, tweeting, posting, and blogging across different social platforms at this very moment. Globally, 3.96 BILLION people use social media.

It’s no wonder, then, that websites like Linkedin, Facebook & Instagram have become powerful marketing weapons. Companies like yours can use these platforms to target clients, move prospects through sales and marketing pipelines, and increase revenue.

How much should you really spend on social media, though? How much should you negotiate when you contact a social media marketing agency?

By the end of this post, you’re going to find out the truth about social media marketing costs. You’ll also get some helpful guidelines so you can figure out how large your social media marketing budget needs to be.


Before we dive into the specifics around social media marketing and budget planning, it’s important to understand all the benefits that come with investing in social media marketing.

Do you really need to dedicate a portion of your budget to advertising on Facebook, Instagram, and other social media platforms? In short, the answer is yes. 

In case you need some more convincing, here are a few of the benefits that come with good social media marketing and a dedicated social media marketing budget:

  • Reach a larger audience and build brand awareness.
  • Connect with your audience and increase engagement.
  • Increase traffic to your website.
  • Generate more leads and increase sales.
  • Gather valuable data from social media followers to fine-tune future marketing campaigns.

Social media marketing also allows you to offer a higher level of customer service. You can connect with followers and resolve problems faster, which improves your company’s reputation and ensures you experience long-term growth and success.


This is the million-dollar question. The truth, though, is that it all depends.

Generally, total marketing spend is influenced by various factors, such as:

  • The size of the company (number of employees)
  • The industry sector (legal, real estate, manufacturing, etc.)
  • The type of marketing used (SEO, social media, trade shows, print, etc.)
  • The company’s total annual revenue

Every business’s marketing budget will be (and should be) different. Per the Small Business Administration, though, if your business brings in less than $5 million per year in sales, the recommendation is to allocate between 7-8 percent of gross revenue to marketing and advertising.

If you brought in $5 million, for example, your marketing budget would be somewhere between $350,000 and $400,000.


What about spending on Social Media Marketing, specifically?

According to an study conducted by The Content Factory, the average business spends between $200 and $350 per day on social media marketing. This works out to between $6,000 and $10,500 per month or between $72,000 and $126,000 per year.

Additional data from Deloitte’s CMO Survey also reveals that companies allocate, on average, about 13 percent of their marketing budgets to social media marketing. If you had a $350,000 marketing budget, that would work out to $45,500.


Does the idea of spending tens of thousands of dollars per year on social media cause you to start sweating?

That’s okay. You’re not alone.

There are plenty of variables that influence your social media marketing budget and cause you to spend more or less than what’s outlined above, including the following:

  • Size of your company (companies with more employees often spend less than those with fewer employees, likely because large companies also have more name recognition)
  • Industry sector (retail businesses tend to spend more on social media marketing, on average, than IT companies, for example).
  • Specific business goals (Are you trying to build brand awareness? Increase engagement? Increase sales?).
  • Software and tools (Hosting, search engine optimization keyword research, editing tools, project management systems, etc.).
  • Types of social media advertising (Facebook Ads, Twitter Ads, Instagram Ads, paid partnerships with social media influencers, etc.).
  • Whether you hire an in-house social media marketing specialist or outsource to a social media agency.


It’s important to note that very few businesses have a strategy exclusively for social media marketing and advertising. They spend a decent amount of money on content marketing, too.

What is content marketing?

Content marketing is all about creating and sharing content (blog posts, videos, infographics, etc.) that is valuable and relevant to a company’s audience. Ultimately, quality content marketing will drive audience members to take action and invest in the company’s products or services.

Social media is the primary mechanism for sharing content. This is why it’s important to consider both of these marketing methods when you’re negotiating social media marketing costs and planning your company’s budget.


Content marketing and social media are two of the most important components of digital marketing. Research has shown, time and time again, that these two methods could provide you with a significant return on your marketing spend investment. 

For example, a study from the Content Marketing Institute revealed that 72 percent of marketers say that content marketing increases engagement and increases leads.

Then, there’s social media marketing to think about. Most adults (95 percent) aged 18-34 follow at least one brand via social media.

At the same time, 71 percent of consumers who have a good experience with a brand on social media are likely to recommend that company to other people.


Simply put, content marketing and social media marketing go hand in hand, and both are essential. This is especially true when you’re trying to increase your search engine ranking, drive more traffic to your business’s website, and boost sales.

When your content marketing and social media marketing strategies are aligned, it’s much easier to provide value to your audience, increase business visibility, and see results (and returns on your investment).

Because content marketing and social media marketing are so interconnected, it makes sense to combine your budgets for both strategies. You can’t have one without the other, so you might as well account for both when calculating costs and planning your budget.


Taking into account all of the above, let’s try and settle this for good. How much money should you be spending on social media marketing and content marketing combined?

Here are some tips that will help you calculate a budget that works for your company and helps you see the kind of results you’re looking for:

Calculate Your General Marketing Budget

Start by taking a look at your total marketing budget. Remember, the Small Business Administration recommends allocating between 7-8 percent of gross revenue to marketing (assuming you’re earning less than $5 million in sales per year).

Let’s say you have gross revenue of $3 million for the year. That means your total marketing budget would be about $210,000.

Calculate Your Social Media Marketing Budget

Now, let’s calculate 13 percent of that amount. As we mentioned above, businesses spend, on average about 13 percent of their marketing budget on social media marketing.

Thirteen percent of $210,000 is $27,300.

You might be thinking, “that’s way lower than the $72,000 mentioned above,” and you’re right. If you’re running a small business, it makes sense that you wouldn’t have as much money to dedicate to social media marketing.

The average organization may have the funds to spend $72,000 or more per year on social media marketing. For a small business, though, this is a healthy social media marketing budget. It can get you pretty far, especially if you’re new to promoting your brand on social media.

Establish Goals and Priorities

Once you have a general number to work with, take a step back and think about what you want to accomplish with that money.

What kinds of social media and content marketing methods do you want to use to accomplish them? For example, do you need to hire a copywriter who can write blog posts for you?

Do you need to hire a videographer who can create social media videos? How much do you plan to spend on Facebook ads or Instagram ads?

If you have lofty goals for your business when it comes to social media marketing, you may need to spend a bit more to turn them into realities. The number you calculated using the formulas above is just a jumping-off point. It doesn’t have to be (nor should it be) set in stone.


Are you still feeling a little anxious about your budget? Are you unsure of how you’re going to be able to afford to spend enough to reap the benefits of social media marketing?

If so, here are important tips to keep in mind:

  • Do market research: Learn about where your audience spends the most time; that way, you won’t spend a ton of money advertising on a platform none of your target customers are using.
  • Monitor analytics: Pay attention to the types of content and social media posts that get the most attention, then create more content and ads like that moving forward.
  • Social media agencies save you money: They charge flat fees for their services, which is more cost-effective than hiring an in-house employee and paying for all the extra costs that come with them.


As you can see, there’s a lot to consider when calculating your company’s social media marketing budget. Keep these tips in mind, though, and you’ll have a much easier time figuring out how much to spend on social media and content marketing.

Once you have a general number, keep it in mind for when you reach out to a social media marketing agency. Then, you can negotiate a good social media marketing cost that will provide you with a return on your investment. When you’re ready to have a partner in your marketing we can help feel free to reach out to us.

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