Content is weird.
It’s a “must-have”, the stuff they say works best, yet its attribution remains mysterious in most cases and pricing for outsourcing is about as stable as the price of crude oil.
If you’re like most founders, you’re probably:
- Creating content
- Posting on LinkedIn (and people are engaging!)
- Your email list is growing, even if haphazardly
- You have some website traffic…
But…what are you getting back? How much do you need to spend to get a return?
While content can be notorious for its lack of attribution, there’s still a way to calculate what it will cost and for what return. That’s what I’m attempting to do today.
If you’re Googling the cost or ROI of content marketing, you’ll find plenty of articles listing random stats that don’t make you feel much more comfortable about your investment. Some agencies will say they’ll “do SEO” for $500 a month, and others will give you 4 blog posts a month for $5000…but what does any of that mean for your business?
Can you measure the ROI on content marketing?
Mostly, yes.
There are parts of content you can’t attribute.
You can’t track word-of-mouth, you can’t measure the effect of ungated content. You might not get as much revenue in the pursuit of tracking every single thing.
However, there is a lot you can track.
In this article, we will dive into the real cost of content marketing and all its moving parts. We’ll talk about the cost of doing content marketing in-house, what the difference in ROI is between just creating content is compared to implementing a whole strategy, including distribution, and how to measure ROI.
Want to launch a fully done-for-you content marketing strategy for less than the cost of 1 full-time marketing employee? Get in touch with us today to see if we’d be a good fit.
Content marketing goals
Content marketing can cost anything, really, it depends on your goals.
At Flying Cat, most of our clients want to get more leads and maximize qualified traffic. The goal is usually not to just output some deliverables.
So based on that alone, the cost is more than the cost of writing blog posts. It involves strategy, planning, and distribution as well.
We don’t just create content and leave the client to distribute it themselves. That’s part of our responsibility, because we tie ourselves to goals, not the number of blog posts written.
So if your goal is just to have articles written, your costs will be different than if your goals is to meet business objectives and increase leads.
We created a guide to interviewing customers for content that resonates with them
CREATE CONTENT FOR GROWTH
Content marketing costs
So again, looking back at creating content marketing strategy for your startup business, lots of clients come to us asking for a price based on deliverables. You know you want to publish two blog posts per month, around 1000 words each. Sounds simple enough, right? Even if you’re budgeting $300 per post, that’s only $600 per month.
If you’ve tried that before, you may encounter the same problem I hear from most founders that come to us for help: it didn’t do anything.
“Content marketing doesn’t work.”
Well, no. Not when you do it like that.
It does take some deep customer research, planning, design, graphics, interviews, great content, and last, but certainly not least—distribution.
Our content strategy creation and implementation involve the following:
- Customer research
- Journey mapping
- Topic structure and planning
- Keyword research
- Editorial calendar creation and maintenance
- Expert interviews and deep, thorough research
- Content creation (copywriting & graphics)
- Data tracking & analysis
- Distribution: online communities, paid distribution, outreach
- Link building strategies & PR
- Software costs (e.g. Ahrefs, Clearscope, Buzzstream/lemlist)
So, how much does this all cost? The benchmark for B2B businesses is an average of 29% of their entire marketing budget. The most successful B2B marketing campaigns were those that dedicated 39%.
So at what point is it financially viable to invest in all of this? Let’s talk about the cost of acquiring a customer and how content can play into that.
What’s a good customer acquisition cost?
Knowing how much you should spend to acquire your customers will provide some understanding of your overall cost of content marketing and its payback period.
SaaS business owners tend to agree with the 3:1 LTV:CAC formula. You also want to be able to recoup those investments within 12 months of acquisition. When you look at the numbers, the average SaaS will spend between 6-12x their monthly subscription cost to acquire a new customer.
For example, Grammarly has an annual subscription fee of $139.95, so their CAC should be around $70-$140 on CAC.
Cost of content marketing technology
The pricing involved with different software can vary, but we’ve tried to map out the costs involved here. I don’t know what tech you currently use to manage your blog and content marketing, you should be able to get started with a minimal stack.
- SEO software: We use Ahrefs and Clearscope. These are probably the biggest tech investment for content. They have tools for keyword research, competitor analysis, link building and rank tracking which will help your content reach your target audience. Subscriptions can be customized to your business needs but will typically run you between $170-$999 per month.
- Opt-in and email marketing software: We use both MailChimp and ActiveCampaign for email marketing. These prices scale as you grow but aren’t that expensive.
- Whatever content management system you work with, WordPress etc. It’s not awfully expensive but a cost to consider.
Tech can be minimal. If you’re like me, you get carried away easily by fancy new tech, which gets expensive quickly.
Cost of a content marketing team
Your content marketing costs will include more than just hiring freelancers or content writers to write a piece of content. It takes a team create and implement your content marketing strategy effectively.
- Who’s creating the content strategy and marketing plan?
- Who’s analyzing competitors?
- Who’s conducting keyword and market research?
- Who’s creating/managing your editorial calendar?
- Who’s writing, editing, and proofreading your content?
- Who’s creating the graphics for your blog content?
- Who’s publishing and distributing your content?
- Who’s in charge of brand awareness and engagement?
- Who’s running ads, promoting and distributing content?
- Who’s reoptimizing old content?
- Who’s tracking conversions and measuring success?
So many startups have one person doing all of this AND still responsible for business development, sales, and partnerships. Also, it happens to be someone who hasn’t really done this stuff before and is throwing spaghetti at a wall. Talk about spreading yourself thin.
Let’s say you agree that one person is not enough to do this all, your options are to build an internal marketing team or to outsource it to an agency.
Let’s break down the costs of both in-house and agency marketing teams so you can identify which suits your business best.
1. Cost of an in-house marketing team
While an in-house marketing team gives you full control, it’s not always worth the substantial salary costs. Here are the average salary costs you can expect for some of the critical members of your marketing team:
|
employee |
average yearly salary |
|---|---|
|
Strategist |
$89,698 |
|
Copywriter |
$69,935 |
|
Editor and project manager |
$61,655 |
|
Graphic designer |
$52,589 |
|
Social media manager |
$59,965 |
|
Facebook ads manager |
$54,713 |
|
Public relations manager |
$69,154 |
These salary costs are unrealistic for startups and small businesses, so many choose to hire one full-time marketing manager to do everything. The average salary of a junior level marketing manager is still around $49,000 per year.
You will likely still need to hire the copywriter and a graphic designer in most cases, invest in software and, of course, train your staff.
On top of that, the above salary doesn’t include employee benefits, paid time off and employment taxes. You also need to supply the equipment for them to work on, and the physical space for them to work in.
2. Cost of a content marketing agency
Outsourcing your content marketing to a digital marketing agency gives you access to a team of experts who will act as an extension of your team. They provide all the skills that you lack in-house, without the high salary commitments involved with hiring staff full-time.
The cost of content marketing through an agency will cost you somewhere between $1,000 to $10,000 per month. For a full A-Z content strategy and execution, we charge $5000 / month. For the pricing of a single, salaried employee, you will get a content strategist, copywriters, graphic designers, and editors.
Plus they already have processes, systems, have successfully launched content marketing strategies before, and an out-perform most full-time employees. On top of that, agencies cover the costs of their own equipment, training, and software.
When you outsource to a content marketing agency, you’re tapping into a network of digital marketing specialists. These marketing teams eat, sleep, and breathe content marketing. They know that you have one goal with your content: to acquire customers.
Cost of content marketing
Considering all the above factors, what is the total cost of content marketing? There is no magic dollar amount that each business should be spending on content marketing. Depending on your business model, the cost will vary.
Using your customer acquisition cost is the best way to identify if your content marketing budget delivers a good return on investment or if you should be investing more, or less, in your content marketing efforts.
Outsourcing your content marketing through an agency is a great way to stay on budget and know exactly how much you’re spending each month. You can then measure your average CAC over a period of time and assess whether you need to re-evaluate your spending.
As stated above, on average, businesses allocate 29% of their marketing budget to content marketing. The higher that percentage grows, the more successful your campaigns will be. For startups and small businesses, that could be around $2000-$5000 per month. As your business grows, you may want to invest in more content, more in-depth research, or advanced reporting software. You can scale this as you go.
Calculate acquisition cost from content marketing
This is a simple calculation, really: you add up your costs and divide it by the number of customers you get from that investment. In our case, we’d divide it by the multiplication of the traffic you get x your conversion rate.
When we’re talking about marketing expenses, there are three main categories to look at:
1. Content costs
The first metric you need to examine is content creation costs. This will include content writers or freelancers, editing, custom graphics or images, etc. The cost will vary depending on the amount of research, length of the articles, and which industry you’re in. Content creators and bloggers may charge per word, per hour, or on a retainer. Beginners may charge anywhere from $0.01-$0.10 per word, with experts charging $1.00+ per word.
2. Salary costs
Salary costs will include full-time employees, contractors, and digital marketing agencies. If you’re outsourcing your content marketing strategy to an agency, then your content costs are included in this. People are the most expensive part of content marketing costs.
3. Software costs
Lastly, you should include any technology that you use in your content marketing efforts. It will consist of project management software, email software, website fees, and anything else that contributes to content marketing.
Once you’ve identified your total spending in the above three categories, you can divide by the number of customers to get the cost per customer. Whether you’re a SaaS business, clothing retailer, or selling a service, you can still identify when you get a new customer as a direct result of your content marketing efforts.
Calculating CAC
The sweet spot for CAC seems to be around 6-18 month rule: so for a SaaS with a product under $100/month, a CAC around $100-$500 is acceptable. Then we want to compare this to the lifetime value of the customer to see how much profit you’ll make from it. LTV should consider churn, payback period and working capital.
All our strategies are SEO-optimized, so the effect is compounding and the cost goes down with time.
How to track how many leads you’ve acquired from content marketing
You can track leads from content on Google Analytics or whatever tracking platform you’re using.
Google Analytics allows you to set up these funnels, You can set up a goal with a destination page that Google fires as a conversion every time they reach that page. It could be a “thank you” or confirmation page after signing up for a lead magnet such as a webinar or even subscribing to your product itself.
Using the data from your content funnels, you’ll be able to see exactly how many leads and customers you’ve acquired as a result of your content. You can then use these numbers to help you calculate your CAC.
Can you do content marketing for my business?
Flying Cat Marketing is a content marketing agency that will act as your B2B SaaS business’s personal content marketing team. For the cost of a full-time marketing employee, our team will take care of your entire content marketing strategy from start to finish.
Our team of expert content marketers will get to know your customer persona and their pain points to ensure high-quality content that is relevant and valuable. We will also handle search engine optimization, branded graphics, and distribution.
Want to see if we’d be a good fit? Get in touch with us today.
We created a guide to interviewing customers for content that resonates with them
CREATE CONTENT FOR GROWTH
