As the holiday season reaches its peak, many ecommerce brands are already planning for the new year. While inventory and campaigns for the holidays are likely already in motion, now is the perfect time to start considering your marketing and advertising budget for 2025. With evolving market demands influencing product, logistics, and customer behavior, it’s essential to approach planning strategically. Clearco is here to provide insights into what your ecommerce business can expect in 2025 and help you map out a plan to maximize your return on investment (ROI) and advertising spend (ROAS).

The Current State of Ecommerce Marketing 

2024 has seen emerging trends within the ecommerce space, with increased competition, global inflation, and economic uncertainty driving up the cost of digital marketing across online platforms. As these challenges persist, it’s imperative that brands are more strategic than ever in their marketing efforts to ensure the best return on their investment (ROI). Strategic planning is in full swing as brands gear up for the new year, and emerging marketing trends are taking center stage. It’s essential for scaling ecommerce brands looking to stay attuned to these trends, ensuring campaigns remain competitive, resonate with target audiences, and align with shifting consumer behaviors.

Trends Shaping Ecommerce Strategies

Rising inflation rates have significantly impacted customers' buying patterns, with 61% of consumers reporting adjustments to their spending behavior due to rising costs. Ecommerce brands are feeling the effects of more cautious shoppers and must adapt to these shifting habits. Emerging trends, such as generative AI, are transforming shopping experiences by offering highly personalized interactions. The rise of short-form video content and influencer partnerships is also reshaping how consumers prioritize spending.

To stay competitive, brands should anticipate future trends through strategic planning and exploration. This includes analyzing the most effective ways to allocate marketing funds across channels. Notably, 69% of marketers report integrating generative AI into their operations, enabling ecommerce businesses to tailor marketing and shopping experiences to meet evolving customer needs.

How to Allocate Your 2025 Marketing Budget

Aligning your marketing budget with your business goals and revenue is crucial for ecommerce success. Most ecommerce and retail businesses allocate 10-15% of their revenue to marketing efforts, while those adopting a more aggressive approach may dedicate up to 30% to customer acquisition.

When planning your marketing spend, it’s essential to consider your brand’s upcoming goals and growth plans. Ask yourself:

• Is your business launching new products?
• Are you expanding into new markets?
• Will you be testing different channels?

These factors play a critical role in shaping your marketing and advertising budget. To maximize efficiency, consider mapping out your budget by channel and prioritizing high-performing campaigns that deliver consistent results throughout the year. Key channels to focus on include:

• Content Marketing
• Search Engine Optimization (SEO)
• Paid Advertising
• Social Media
• Influencer Marketing
• Email Marketing

By leveraging these strategies, ecommerce brands can expand their reach, enhance visibility, and maintain a competitive edge in an ever-evolving digital landscape.

Maximizing Ad Spend for Ecommerce Success

Every ecommerce market has a unique audience, making the allocation of funds for effective promotion a nuanced process. To optimize your marketing spend, strategic planning supported by analytics and tracking is essential. This ensures your business is budgeting effectively and investing in the right channels to reach your target audience.

Key metrics like Return on Ad Spend (ROAS) and Return on Investment (ROI) should be prioritized to guide smart investments and deliver meaningful returns.

• A good ROAS for ecommerce businesses is typically a 2:1 ratio, meaning $2 in revenue for every $1 spent. However, this can vary based on your industry, profit margins, and average cost per click.
• A strong ROI reflects the revenue generated after expenses and will depend on the specific channel and type of investment.

Tracking these metrics is critical for evaluating the strength and performance of your campaigns. By focusing on ROAS and ROI, ecommerce businesses can ensure their ad spend is working effectively to drive growth and profitability.

Optimize Your Marketing Spend for Better Returns

When it comes to planning out your marketing strategy for the year, it’s important to keep certain considerations in mind.

• Set Clear Goals: Ecommerce brands should define SMART goals (Specific, Measurable, Achievable, Relevant, and Timely) to measure campaign success. Align these goals with overarching business objectives like increasing traffic, boosting sales, or enhancing customer retention for a focused approach.
• Leverage Data & Tools: Implementing tools to track the performance of your campaigns in real time will take your data analysis to the next level. Use tools like Google Analytics and AI-driven platforms to help your ecommerce brand make informed decisions and help optimize manual tasks.
• Plan for the Long Term: Build out sustainable, scalable strategies, rather than quick wins. Account for market shifts and slow periods by continually adapting your strategy approach based on performance to help your ecommerce business stay competitive in the evolving market. 
• Consider Seasonal and Market Shifts: Ecommerce brands should be cognizant of the impact seasonal shifts can have on a business. Capitalize on seasonal shifts, such as holiday season shopping spikes, by amping up ad spend and tailoring new campaigns to the holidays. For example, online holiday sales rose by 4.9% in 2023, signaling the value of responding to timely opportunities and allocating a portion of ecommerce budgets for seasonal spikes with emerging advertising opportunities.
  

Creating an effective marketing budget for ecommerce is not a one-size-fits-all strategy. Whether your ecommerce dedicates 10-30% of your revenue to marketing, it's important to align your business goals and growth plans. By identifying high-performing channels, testing new opportunities, and tracking performance metrics like ROI and ROAS, brands can make data-driven decisions. Staying agile and leveraging analytics ensures your ecommerce will be set for success and achieve measurable results. 

Scaling your business through marketing doesn’t have to be overwhelming. Clearco’s Receipt and Invoice Funding solutions support your ecommerce brand in confidently taking next steps to expand its reach, maintain performance, and yield consistent results. Explore how Clearco can empower your ecommerce brand this holiday season and into the new year with tailored funding solutions—get funding now.