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 Types of Programmatic Advertising Budgets

Display advertising budgets come in all shapes and forms. There are a number of common ways that businesses determine their advertising campaign, some which are highlighted below:

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1. Proportion of Sales

In “advertising history”, using a percentage of sales has been one of the most common methods. The average percentage of sales to spend on advertising is around 5%. However, some, such as expert Roy H. Williams (you can read his method here), argue that this method does not work for all industries or that it is a far to simple model to follow to determine a display advertising budget.

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2. Goal-Oriented

Often your goals can influence your display advertising budget. For example, a goal to have takeover banners on all major news websites regularly is going to require a bigger budget than running small retargeting campaigns throughout the year.

3. Industry Standard

To be able to compete in your industry it might be worth looking at what the industry standard for spend on advertising and display advertising is. However, you might not want to do what your competitors are doing to set yourself apart in the industry.

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4. Campaign History

Using display advertising campaign history or sales history to determine future spend is an often debated way of determining a budget. One argument is that if something has worked for you before, then why change it. However, others argue that there are so many external factors that can influence a display advertising campaign- it is not just the amount of money spent on a campaign that determines its success. Other factors such as timing can play a huge part in determining the success of a campaign too.

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