What Should You Invest in Digital Marketing in 2025?

December 20, 2024

As digital marketing continues to evolve with new technology and platforms, businesses must re-evaluate their budgets and strategies to stay competitive. The potential policy changes under the Trump administration, including tax adjustments and shifts in federal spending, could influence the broader economy—and by extension, your marketing approach.

Here are some updated considerations to help you determine the right investment in digital marketing for your business:

1. What Business Are You In?

Consumer-facing businesses, like retail and local services, continue to lead the pack in digital marketing investments. Spending 12–15% of revenue on marketing remains common, especially for newer businesses or those launching new products. This allocation allows for robust campaigns across social media, paid advertising, and influencer partnerships.

For B2B companies, digital marketing often takes a more targeted approach. SEO, LinkedIn advertising, industry-specific publications, and trade shows are still essential, but digital tools like programmatic ads and hyper-personalized email campaigns offer the highest ROI. Allocating 5–7% of revenue remains a good starting point, though increasing to 10% or more can yield exponential returns in a competitive landscape.

2. How Important Is “Location” to Your Business?

The digital equivalent of “location” is your online presence. A strong online brand—backed by high search engine rankings, active social media profiles, and engaging content—can drive traffic without relying on a premium physical location.

For instance, a local business competing against larger chains can close the gap by investing in targeted Google Ads or local SEO strategies. Digital marketing levels the playing field, but businesses must allocate the necessary budget to make their presence known in their market.

3. What Is Your Competition Doing?

Digital marketing remains the battleground for business competition in 2025. If your competitors are dominating Google search results, leveraging AI for personalized ads, or scaling up on TikTok and Instagram, you can’t afford to sit on the sidelines.

Conversely, if you are the market leader, new competitors may be chipping away at your dominance through aggressive online campaigns. Regularly audit your digital strategy to ensure you’re not losing ground to competitors investing in emerging trends or platforms.

4. What Can Your Business Afford?

While cash flow remains king, cutting digital marketing should be a last resort. Economic uncertainty may encourage some businesses to tighten their budgets, but smart marketers know that pulling back too much can result in long-term losses.

If cash flow is tight, focus your spending on channels with clear, measurable ROI, like pay-per-click advertising or retargeting campaigns. Maintain baseline efforts in SEO and social media to ensure your brand stays visible even during lean times.

5. What Does the Future Hold?

Long-term planning remains essential for digital marketing success. While Google Ads and social media ads offer instant gratification, strategies like SEO, content marketing, and organic social media growth require ongoing investment to yield results.

With the potential for economic shifts under the Trump administration, businesses may see changes in consumer behavior, ad costs, or tax incentives for digital investments. Stay agile by testing new tools and platforms while maintaining a consistent focus on foundational elements like SEO and content.

Key Trends Shaping Digital Marketing in 2025

• Increased Video Content: Consumers continue to prefer video, from short-form clips on Instagram and TikTok to detailed product demos on YouTube. Prioritize video production in your budget.
• AI-Driven Advertising: Automated ad placement and AI-based personalization tools are making it easier to optimize campaigns and stretch your budget further.
• SEO Complexity: Google’s evolving algorithms (including updates like MUM) make it harder to rank organically. Companies must invest in fresh, high-quality content and technical SEO just to maintain visibility.
• Omnichannel Strategies: Successful brands are integrating online and offline marketing efforts, using tools like QR codes, geo-targeted ads, and social media to connect with consumers at every touchpoint.

The Cost of Waiting

Delaying your digital marketing investment only gives your competitors more time to establish dominance online. With businesses allocating upwards of 15% of their marketing budgets to digital in 2025, waiting means climbing a steeper hill and paying higher costs to catch up.

Whether you’re building your strategy from scratch or optimizing an existing plan, now is the time to act. Digital marketing is no longer optional—it’s essential.

Need Help With Your 2025 Marketing Plan?

Crafting a digital marketing budget that aligns with your goals and the evolving landscape can be challenging. Let our team help you navigate the process and maximize your ROI. Contact us at (866) 732-2271 or drop us a line to discuss your needs.

Let’s make 2025 your best year yet!