GlossaryBudget Optimization

Budget Reallocation Strategy

Also known as: Fluid Budgeting

Budget Reallocation Strategy is the systematic process of moving funds from saturated, low-marginal-return channels to unsaturated, high-marginal-return opportunities. It relies on real-time incremental signal rather than historical attribution reports.

The Short Version

Robbing the fat to feed the hungry.

Prerequisites

The Static Budget Trap

You set the budget in January: $50k FB, $50k Google.

In March, Google is performing 3x better. But you stick to the plan because 'that's the budget'. You burn cash on FB and starve Google.

How it works

1

Weekly Review of Marginal ROAS per channel

2

Identify 'Budget Slack' (channels with diminishing returns)

3

Shift 10-20% of slack to test channels or high-performers

Common Misconceptions

Reallocating based on Last-Click ROAS (Over-funding Branded Search)

Waiting for monthly finance meetings to move money (Markets move daily)

Fearing 'learning phase resets' more than wasting money

In SpendSignal

SpendSignal provides 'Reallocation Alerts'. Example: 'Move $5k from Facebook to TikTok to gain an estimated $1.2k incremental profit'.

Deep Dive Concepts

Portfolio Optimization (Marketing)

In short: Don't put all your eggs in the 'Facebook' basket.

Related Terms

Marketing Budget GovernancePortfolio OptimizationMarginal Roas

Frequently Asked Questions

QHow often should I reallocate?

Minor shifts (tactical): Weekly. Major shifts (strategic): Monthly or Quarterly. Do not react to daily noise.

Learn more about SpendSignal

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