How to create a paid media forecast and plan.

One of the most important tools for a scaling brand is a comprehensive media plan and forecast. It gives you a clear outline of how you will scale your brand and drive additional revenue from advertising.

Imagine that someone came to you and gave you a budget and revenue goal for your brand. How do you know if that budget is enough? How do you know where to allocate your resources? How do you know if you’re being the most efficient?

That’s where a clear and thorough media forecast helps.

Why create a media forecast?

Media forecasts are not easy to create, but they are an extremely powerful advertising tool. They offer clarity on your growth plans, the budgets needed, and the channels you’ll be activating.

Ensure attainable goals and required budgets.

One of the most important things that a media forecast does is to ensure your annual goals and budgets are in alignment.

When you start planning your monthly projected spend and ROAS, adjusted for some assumptions (which we’ll go over shortly), you can quickly see if you’re going to achieve your goals or not.

Maximize your budgets.

Once your know your budgets are realistic, you can then start planning how to maximize your returns.

The media plan allows you to do this by mapping out the channels you’ll be activating, as well as the budget by month. When you overlay your previous data and monthly marketing calendars, you can ensure you’re using the right channels to scale at the right time.

Your roadmap for achieving success & diagnosing problems.

When you create a comprehensive media forecast, your plan should include more than just channels, budgets, and revenue. Optimally it will include all key KPIs you need to manage your campaigns effectively.

When a campaign KPI is below what was forecasted, you can quickly identify the problem and pivot your campaign strategy.

What is a media forecast?

We’ve spoken about the benefits of the media forecast, but we still need to outline exactly what should be included in the forecast. At a minimum, we recommend outlining the following key data dimensions and metrics in your media forecasts.

Data dimensions to include.

Dimensions allow you to break out your campaign data into actionable buckets.

We recommend including at least the following key data dimensions:

  • Month: to account for seasonality and demand
  • Customer stage: to track data by “awareness”, “consideration”, “conversion”, and “loyalty.”
  • Channel: to appropriately allocate and measure by channel.

Depending on how much data you have and the granularity you need, you might add additional dimensions to your plan.

Campaign metrics to include.

Once you have your dimensions, you’ll want to ensure you’re tracking all the important metrics. The metrics will be data points that you can monitor and plan for.

We recommend including the following campaign metrics:

  • Budget
  • Revenue
  • Return on Ad Spend (ROAS)
  • Cost per Mille (CPM)
  • Impressions
  • Click Through Rate (CTR)
  • Cost per Click (CPC)
  • Clicks
  • Conversion Rate
  • Purchases
  • Cost per Purchase
  • Average Order Value

Putting it all together.

Once you have the dimensions and metrics you want to include in the media plan, then it’s time to put it all together.

We use Google Sheets for our media plans. It allows us to easily share the plans, actualize the plans, and track changes.

Our media plan overviews look like this:

An example of QRY's media plan overview.

Creating the media forecast.

Now that we have the layout, it’s time to start filling in the data.

The actual media forecast process uses known data to create the initial plan and then is adjusted based on other variables. The process is not an exact science, and accuracy relies on the expertise of an experienced media planner.

Start with historical data.

The first step is looking at historical data. We recommend going back at least two years of campaign data. This allows you to track campaign trends and overall brand performance.

You’ll want to make sure you understand the following:

  • CPM, CTR, CPC, and conversion rate by channel
  • Conversion rate of the website
  • Organic growth rate

These initial data sets will act as the foundation for your media forecast.

Add key brand inputs.

Next, you’ll want to make sure you have a clear understanding of the brand's marketing calendar, budgets, and revenue targets.

The marketing calendar is important because you need to understand key product drops, sales, and marketing activations for the brand. This allows you to either adjust your media spend and expected ROAS based on what other marketing the brand will be doing to support growth.

An example marketing calendar.

Refine with industry benchmarks.

Once you’ve accounted for all the brand information and data, the next step is to plan for campaign optimizations.

There are two ways to account for campaign optimizations:

  1. You can adjust channel CPM, CPC, and CTR at a certain rate, assuming that they will get better at that rate.
  2. If you have access to media benchmarks, you can assume your campaigns will shift toward those benchmarks over time.
At QRY, we track and monitor KPI benchmarks across multiple e-commerce industries.

Account for the known.

At this point, you should have a fairly well-planned media forecast. We’ll have to update it to account for things that we know will impact our campaigns.

You should account for at least the following; there may be others in your industry:

  1. Auction inflation - CPMs increase yearly due to inflation on the ad platforms. You can use industry benchmarks or your historical data to plan for these increases.
  2. Competitive pressure - We know competition tends to increase year over year, so plan to account for that in your CPMs and CTRs.
  3. Known world events - Elections, the Olympics, the World Cup, and other major events can impact media costs. Make sure to account for these events in your monthly breakdowns.
  4. Regulatory changes - We know privacy regulations are impacting campaigns. You’ll want to adjust campaign forecasts since these changes will impact campaign targeting and performance.

Allocate 10% of your budget for experimentation.

Lastly, an important element of the media forecast is planning for new channels and campaign experimentation. Setting aside a budget for these experiments ensures you have what you need to continue to scale your campaigns successfully.

We recommend setting aside 10% of your budget for campaign experimentation. The budget could be used for new technologies, channels, and campaign tactics.

Highlighting the "experimentation budget" in a media plan.

Update your budgets to maximize channel impact.

Once we have all the data in the media plan, now is when a media planner would adjust the budgets to ensure that we’re maximizing results.

The media planner should answer the following key questions:

  • Have we maximized our budget for the conversion audiences?
  • Have we maxed our budgets for high ROAS channels?
  • Have we invested enough in brand awareness and consideration?
  • Have we invested enough in the most effective awareness channels?
  • Did we achieve our revenue and ROAS targets?

Updating your media forecast.

Once you’ve created the media forecast, you’ll need to update it. As you collect more data, the forecast needs to adjust for campaign actualities.

When to update the forecast

You should be actualizing your media forecast weekly and updating your campaign forecasts monthly. This allows you to track your results against your media forecast regularly and updates your projections in a meaningful way.

How to update the forecast

As you collect new campaign data, you’ll be able to monitor metric trends that can influence future channel forecasts.

For example, if we had projected our Meta CPMs to be $20, but in actuality, they end up being $14. We’ll want to account for that difference and update our future forecasts with this new data.

What now?

The first step is creating your initial media forecast and iterating from there. It doesn’t need to be perfect, but it should act as a guide for your campaigns. It is a lot of work to create and maintain, but it’s imperative for a scaling brand.

Want help creating a media forecast for your brand? Schedule time with one of our strategists.