Business development · 13 October 2016

Two-thirds of ecommerce startups plan to increase marketing spend over the next year

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Research showed that 59 per cent of ecommerce startup owners conducted all marketing without expert advice

Startup owners in the ecommerce industry are planning to increase existing marketing budgets in the next financial year, according to a new report.

A survey conducted by media company MC&C found that two-thirds of respondents planned to increase existing marketing spending over the next 12 months, while just ten per cent said they had no plans to do so.

Spending on digital marketing tools was found to be a major consideration, as a further two-thirds planned to increase budget proportion on online channels alone.

Commenting on the study, managing director at MC&C, Mark Jackson, spoke of the major role that marketing now plays in the profits of a small firms, stating that “marketing is an essential engine of growth, not a cost of business”.

“The cliché that half of all advertising is waste and no one knows which half should be confined to the dustbin of history. Marketing is an essential engine of growth, not a cost of business,” Jackson added.

However, a tendency for “DIY” marketing was highlighted in the research, with 59 per cent of small online retail owners operating their media buying in-house.

Further to this, some 22 per cent of respondents admitted to having little idea of how effective their marketing was, or having any parameters in place to measure success rates.

Jackson warned of bad marketing practices, and that without expert advice, insights could be wasted.

“Startup marketers have become overly focused on what they can measure in-house – a DIY approach to media buying that has led to a relative overspend on digital channels, putting the brakes on growth,” he said.

“Digital marketing is measurable and effective without doubt. But after a point it’s a case of diminishing returns. UK businesses are often leaving it too late to get professional advice,” Jackson added.

Running a new business? Don’t miss these ten essential tips for effective digital marketing.

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ABOUT THE EXPERT

Simon Caldwell is a reporter for Business Advice. He has a BA in politics and communications from the University of Liverpool, and previously worked as a content editor in the ecommerce industry.

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