How To Optimize Your Media Budget With One Simple Rule

By Katherine Daniel & Kate Newstead , Research Leads at The B2B Institute

No matter your budget or your “starting point”, there are ways to optimize your brand spend and outperform your competitors. One such method is to consistently leverage your media spend for long-term brand growth.

After analyzing more than 50 of the top B2B advertisers on LinkedIn, we find that it’s not always the biggest, highest-spending brands leading the way. In some cases, even with a more modest budget and lower brand penetration, smaller brands can surpass their larger peers when it comes to consistent investment.

How Does Even Spending Maintain Mental Availability?

Consistently investing in brand advertising is considered a fundamental best-practice in marketing strategy. But why is consistent brand-building so essential?

For most brands in B2B categories, sales patterns are not particularly seasonal. The sales process can and does occur whenever the need for a product arises at any point in the year. If category purchasing in B2B is relatively stable month by month, it follows that your annual advertising budget should be allocated in a similarly stable, even manner. This tactic helps maximize coverage across the potential buyers who might be in the market to buy at any given week or month of the year.?

It also contributes to cost-effective reach by continuously growing the members of your audience who are aware of your brand, while reminding those who are already aware that you have a solution to their current or future needs. By evenly spending, you remain fresh in future buyers’ minds across a wider audience for longer periods of time, ensuring that your dollars are more effectively spent.

By contrast, heavy bursts of spending will flood the market with ads for a handful of weeks or months, but will leave your brand unsupported in subsequent periods with low or no advertising—at which point the door is wide open for competitors to reach and convert potential customers when their brand is more top of mind than yours.

But is this simple logic reflected in B2B media planning? Not always.

B2B Brand Spend Is A Rollercoaster Ride

We examined 54 large advertisers in North America from a variety of industries to measure how evenly they advertised on the LinkedIn platform over 2023.* Even among brands with similar levels of annual spend, on one end of the spectrum, there are brands like the one shown below in blue that maintain a fairly consistent advertising presence. On the other end of the spectrum, brand investment strategies like the one shown in red are also common, with large portions of the year having low (or no) advertising support and spending conducted at an erratic cadence.

Moreover, no one was especially consistent. Out of this list of companies, the lowest relative standard deviation (RSD) was 0.25 and the average RSD 0.59, suggesting that most companies' ad spend veers from high to low and low to high from week to week.

A Bigger Budget Doesn’t Mean Better Consistency

Having a bigger budget does not correlate with more consistent investment, either. When we separate companies into lower, middle, and higher spend tiers, each tier has a median RSD of 0.55, 0.50, and 0.56, respectively. And while it’s true that companies with bigger budgets appear to have fewer extreme fluctuations in their weekly spend, this is by no means an indicator of consistent advertising when even the biggest brands spend between 25-100% more (or less!) in some weeks than in others, compared to what they spend in an average week.

Industries Are Just As Uneven

What about consistent brand investment by industry? The companies in our dataset belong to manufacturing, technology, internet, and media industries, health care, professional services such as consulting and HR, and financial services such as banking and investing. Brands within each industry exhibit a wide range in weekly spend variation, with median RSD values that equate to 50-80% of their average weekly spend. Industry, like budget, is not a strong indicator of how consistently brands will invest in advertising.

Spend 2% Of Your Budget Each Week

As we’ve seen so far, brands can further improve or maintain the consistency of their brand investment.

In general, brands should aim to spend 2 percent of their annual advertising budgets each week. Why 2 percent? With a little more than 50 weeks in a year, 100 percent of spend divided by each week yields roughly 2 percent as a benchmark for consistent and even spending. ?

Shown above, the company with the lowest RSD—and the most even spend in our dataset—has spending habits that conform closely to the 2 percent line. Conversely, with nearly half a year without any advertising presence and large spikes in brand investment over short periods of time, it is evident why the company with the highest RSD has the most uneven spending.

For bigger brands that already spend in relatively even patterns, they can further optimize by overlaying monthly sales data and CPM prices to identify areas for potential savings, and it’s worth considering whether they should invest more to maintain audience presence around peak seasonal moments. Conversely, for bigger brands whose spend is more uneven, consider the incremental reach and cost efficiency that would be achieved with a budget spread consistently over time.

For smaller brands, don't get too caught up in out-shouting bigger competitors when they have heavy bursts of advertising. Playing the long game and gradually increasing spend while remaining consistent is a good approach that will grow your brand presence and your customer base over time.

At its simplest, invest approximately 2 percent of your annual ads budget into each week to ensure a consistent brand presence throughout the year.

*A Note On The Methodology

To gauge consistency in ad spend, we utilized the relative standard deviation (RSD) as a statistical measure of variation in weekly spend. This method is useful for comparing across companies, which can have very different spend totals and very different average spends as a result.

?Average spend is the total annual spend divided by the 52 weeks in a year and is equal to approximately 2 percent of a company’s annual budget.

?As an example of RSD, consider that a company spends on average $3000 per week with a standard deviation of $300. RSD = standard deviation/mean = 300/3000 = 0.10. Multiplied by 100, the company has a RSD of 10%, meaning that weekly spend swings within 10% of their average spend.

RSD = standard deviation/mean = 300/3000 = 0.10 * 100 = 10%

The lower your RSD, the more evenly you spend, the better.

A special thanks to Joyce Gan, Haley Pierce, Jon Lombardo, and Nick Sotolongo for their insight and feedback.