It’s a question we’re hearing constantly from Australian SMEs: how much of our marketing spend should shift from traditional search engine optimisation (SEO) and search engine marketing (SEM – think Google Ads) to artificial intelligence (AI) powered tools? There’s no single answer, but we can provide a framework to help you decide. The key is understanding where each delivers the best return on investment (ROI).

For years, search has been the cornerstone of digital marketing. It’s about being visible when customers are actively looking for what you offer. It’s predictable – you bid on keywords, optimise your website, and track results. However, it’s becoming increasingly competitive and expensive. AI offers a different approach, focusing on proactive engagement and personalised experiences.

Here are a few things to consider when allocating your budget:

• Your Business Maturity: If you’re still establishing a strong online presence and brand awareness, a larger portion – perhaps 60-70% – should remain in search. AI thrives on data, and new businesses often lack the historical data needed for optimal AI performance.
• Customer Journey Complexity: For simple, transactional purchases, search remains highly effective. But if your sales cycle is longer, involving research and consideration, AI-powered tools like chatbots and personalised content recommendations can nurture leads more effectively.
• Competitive Landscape: Analyse what your competitors are doing. Are they heavily investing in AI? If so, you may need to allocate more to stay competitive. However, don’t just follow the crowd; focus on what delivers the best results for *your* business.
• Data Availability & Quality: AI needs good data to work. If your customer data is fragmented or inaccurate, you’ll need to invest in data cleansing and integration before seeing significant ROI from AI tools.

Currently, we recommend a phased approach. Don’t abandon search entirely. Instead, start by allocating 10-20% of your marketing budget to AI experimentation. Focus on tools that integrate with your existing systems – for example, AI-powered bid management within Google Ads, or AI-driven content creation to supplement your SEO efforts. As you gather data and refine your strategies, you can gradually increase your AI investment. We anticipate that by 2027, AI will be a non-negotiable component of most successful marketing strategies, but a measured approach now will yield the best results.

The best next step is to conduct a thorough marketing audit. We can help you analyse your current performance, identify opportunities for AI integration, and develop a budget allocation plan tailored to your specific business goals.