Digital Marketing: Expense or Investment? A Strategic Analysis in the Bangladeshi Context

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The Reality of Digital Marketing in Digital Bangladesh

The interest in digital marketing within Bangladesh’s business landscape is steadily growing. Businesses of all sizes are seeking to enhance their online presence, a positive indicator of the country’s digital transformation. Digital marketing has gained popularity in Bangladesh since 2012. With the increase in internet users, the number of businesses utilizing e-marketing tools is also rising, significantly intensifying market competition.

However, amidst this growing interest, a concerning trend is observed. While many companies are keen on digital marketing, they often get stuck with small budgets, such as $5-$10, when it comes to paid promotions or ‘boosting’. They tend to view marketing as merely an expense rather than an investment, leading to the primary question, “How much will sales increase?” Despite acknowledging the importance of quality content creation, there’s a certain indifference towards its production cost. Even if a good piece of content is created with effort, they hesitate to boost it adequately.

This situation has created a “digital paradox” in Bangladesh’s digital marketing landscape. On one hand, businesses deeply understand the necessity of a digital presence and their interest in this area is clear. On the other hand, they are hesitant about the strategic investment required for effective promotion and achieving desired results. This contradiction indicates a conceptual acceptance of digital marketing, but an incomplete or misguided understanding of its deeper strategic aspects and true investment value. This mindset hinders long-term business growth and prevents the full potential of digital marketing from being realized, as it becomes merely a “check-box” activity that fails to deliver real results. This article will analyze the current digital marketing situation in Bangladesh, address common misconceptions, and encourage viewing digital marketing as a powerful investment by providing data-driven insights and practical strategies.

Listen to a podcast on this topic – https://youtu.be/kak30DIOeJ0

Bangladesh’s Digital Landscape: A Statistical Overview

Bangladesh’s digital environment is rapidly evolving, creating new opportunities for businesses and consumers. This transformation is driven by the widespread increase in internet and social media usage, and the expansion of the e-commerce sector.

As of November 2024, the total number of internet users in Bangladesh is 132.8 million, with 119.06 million mobile internet users. In January 2024, the country’s internet penetration stood at 44.5%. The influence of social media platforms is also significant. At the beginning of 2024, Bangladesh had 52.90 million social media users, equivalent to 30.4% of the total population. Between early 2023 and early 2024, the number of social media users in Bangladesh increased by 9.7 million, or 22.3%.

Platform-wise analysis reveals that Facebook remains the most influential. In January 2024, it had 52.90 million users. While Facebook’s potential ad reach in Bangladesh increased by 22.3% between January 2023 and January 2024, it decreased by 9.0% between October 2023 and January 2024, possibly indicating a shift of users to other platforms. YouTube had 33.60 million users in January 2024, though its potential ad reach slightly decreased by 2.3%. TikTok is rapidly gaining popularity; in January 2024, it had 37.36 million users (aged 18+), representing 48.3% of local internet users. Instagram also saw significant growth, with 6.50 million users, a 46.1% increase. Notably, a gender disparity exists among social media users, with 65.8% male and 34.2% female.

In terms of mobile connectivity, Bangladesh had 188.6 million active cellular mobile connections at the start of 2024. Internet speeds are also improving; the median mobile internet speed was 23.00 Mbps and fixed internet speed was 39.83 Mbps at the beginning of 2024.

The e-commerce market is also expanding rapidly. In 2024, Bangladesh’s e-commerce market is projected to grow by 8.33% annually to reach US$7.5 billion.[4,6]ItisestimatedtoreachUS9.8 billion by 2028, indicating a Compound Annual Growth Rate (CAGR) of 6.78%. Other forecasts suggest e-commerce volume will reach US

9 billion in 2024 and US$13 billion by 2027 (CAGR 12%). Notably, 80% of this e-commerce volume is completed via mobile devices. The number of digital transactions has also increased significantly; between December 2023 and June 2024, it grew by 17% to 478.7 million, accounting for 56% of all transactions.

Table 1: Bangladesh’s Digital Landscape: Key Statistics (2024)

Indicator

Statistics (2024)
Total Internet Users (November) 132.8 million
Mobile Internet Users (November) 119.06 million
Internet Penetration (January) 44.5%
Social Media Users (January) 52.90 million
Social Media User Growth (2023-24) +22.3%
Facebook Users (January) 52.90 million
TikTok Users (January) 37.36 million
E-commerce Market Value (2024) US$7.5 billion
E-commerce Market Forecast (2028) US$9.8 billion
Digital Transaction Growth (2023-24) +17%

 

These statistics highlight the immense potential of Bangladesh’s digital market. However, despite these vast opportunities, some challenges persist. The number of mobile subscribers and internet users has been declining monthly since June 2024. Smartphone adoption in rural areas is low, with only 26% of mobile phone users owning smartphones, and the majority still using feature phones. High tax burdens on telecommunication services (over 54%) and the widespread prevalence of 2G networks (34.34%) hinder digital expansion. Additionally, a lack of data centers and cache servers affects data delivery speed.

A crucial observation from this data is the “digital divide” in Bangladesh’s digital landscape. While the total number of internet users is substantial, the limited use of smartphones and 4G/5G networks in rural areas impacts the reach and effectiveness of digital marketing campaigns. This implies that digital marketing strategies cannot be one-size-fits-all. The same marketing approach will not be effective for urban, smartphone-using consumers and rural, feature phone-using consumers. Different strategies, such as SMS or feature phone-friendly content, might be necessary for rural regions. This also raises questions about the effectiveness of boosting budgets, as boosting becomes meaningless if the target audience is not on the right device or network.

Another important observation is the “Facebook-first” and “TikTok-rise” strategy. While Facebook remains dominant, its ad reach has recently decreased slightly. Conversely, TikTok is growing rapidly, and Instagram’s growth is also notable. These platforms are the primary arenas for digital marketing in Bangladesh. Businesses should prioritize their advertising budgets on these platforms. However, the male-dominated audience will influence gender-specific targeting and content strategies. The recent decline in Facebook’s ad reach might indicate a shift of users to other platforms, serving as a warning for marketers.

Furthermore, despite the growth of the e-commerce market, a “payment barrier” is observed. While e-commerce is growing significantly and digital transactions are increasing, over half of e-commerce transactions are still Cash on Delivery (75%), with very low credit/debit card usage. Digital marketing helps drive traffic to e-commerce platforms, but the payment infrastructure remains a hurdle. Businesses should optimize for Cash on Delivery and mobile payments. It is also crucial to build trust among customers for online transactions through digital marketing efforts, as “fear of cyber fraud” is a real issue.

“Expense” vs. “Investment”: A Fundamental Difference in Mindset

The tendency among Bangladeshi companies to view digital marketing as an “expense” is a deep-seated problem that hinders their long-term growth. Without a shift in this mindset, the full potential of digital marketing cannot be realized.

Why is Marketing Perceived as an Expense?

Many business owners, especially those new to digital marketing, see it as a line item or an unnecessary cost. For them, the first question is “How much will sales increase?”, which emphasizes immediate sales and overlooks long-term brand building or customer relationships [User Initial Query]. This perspective leads them to seek cheap solutions, such as $5-$10 boosting, which often wastes budget without clear results [User Initial Query]. They lack clear goals or measurement methods, making it difficult to understand the true return on investment. Small and Medium Enterprises (SMEs) often operate on limited budgets, making it challenging to allocate sufficient funds for marketing activities. Many small businesses view marketing as an “afterthought,” something to be cut first during difficult times.

This “short-term thinking” traps businesses in a vicious cycle. Driven by immediate sales pressure, they rush towards quick fixes and fail to build long-term brand value or customer loyalty. This results in poor outcomes from low investment, further reinforcing the “expense” mindset. Many startups fail within 1-2 years due to a lack of effective marketing knowledge and strategies.

Furthermore, a misinterpretation of “cost-effectiveness” is also a problem. Digital marketing can be “cost-effective” , but the $5-$10 boosting mentioned in the user’s query indicates that businesses are failing to differentiate between “cheap” and “cost-effective” [User Initial Query]. Ineffective, cheap marketing is actually expensive because it wastes time and results in opportunity loss. True cost-effectiveness comes from strategic allocation and measurable ROI, not just minimal spending. A lack of knowledge about ROI metrics further exacerbates this misconception.

The Importance of Viewing Marketing as an Investment

Marketing should be seen as a revenue engine, not a cost center. It is a scalable, repeatable source of revenue that drives business growth. Long-term marketing strategies build brand authority, credibility, and consistency, which are essential for market survival.

Viewing marketing from an investment perspective focuses on Key Performance Indicators (KPIs) such as Cost Per Lead, Customer Acquisition Cost (CAC), Customer Lifetime Value (LTV), and ROI (Return on Investment). These metrics create real value for businesses and help measure the effectiveness of marketing efforts. Typically, businesses invest 5-10% of their revenue in marketing to sustain, and 11-20% to grow. For new startups, an aggressive 15-20% investment is crucial, as brand awareness and customer acquisition are most critical during this phase.

Boosting and Content Production: Overlooked Investment Areas

To succeed in digital marketing, it’s not enough to merely have an online presence; effective promotion and quality content creation are also crucial. The reluctance of Bangladeshi companies to invest in these two areas is a major obstacle.

The $5-$10 Limit: Why the Hesitation?

The reluctance to invest in paid promotions is a significant issue, evident from the user’s query. While SMEs adopt digital marketing tools, budget limitations pose a major barrier for them. This low budget has far-reaching effects: it leads to limited reach, ineffective targeting, and difficulty in competing. Paid ads are compared to “renting an apartment” – leads only come as long as payment is made; it’s not a substitute for long-term organic growth, but a complement. Local businesses invest about 5-10% of their revenue in digital marketing, while large businesses invest up to 14%. For startups, a 15-20% investment is crucial for gaining visibility in their initial stages.

The Importance of Quality Content and Indifference to Production Costs

Businesses want their content to be seen and liked, but they show indifference towards content production costs [User Initial Query]. Bangladesh’s content writing industry faces its own challenges, such as the role of AI, market competition, and remuneration concerns. Yet, there is a demand for unique, engaging, and SEO-optimized content in the market. Content marketing is essential for increasing brand visibility and customer engagement. Research shows that content marketing generates 3 times more leads per dollar spent compared to traditional methods.

Here, a “content-promotion disconnect” is observed. Businesses want to create content and have people see and like it, but they are indifferent to content creation costs and hesitate to boost good content even after it’s made [User Initial Query]. Creating good content is only half the battle; effectively distributing it (boosting) and linking its quality to performance goals (feedback loop) are equally, if not more, important. If performance data is not communicated to the creative team, content effectiveness decreases. Paying less for content or failing to promote it means wasted effort and budget, ultimately leading to poor ROI.

Impact of Insufficient Boosting: Limited Reach and ROI Loss

Insufficient boosting and indifference to quality content prevent the full potential of digital marketing from being realized. As a result, businesses face unpredictable revenue cycles, high customer acquisition costs, and slower growth.

A “visibility illusion of organic reach” operates here. Businesses desire “people to see and like” their content organically without paid promotion [User Initial Query]. Paid ads are like “renting an apartment,” while organic is compared to “ownership.” However, in a competitive market, relying solely on organic reach without boosting can cause content to get lost. Remarketing costs about BDT 500-1000 per day – a small amount for targeted reach. While organic strategies (content, SEO) are crucial for long-term authority, initial and consistent paid promotion is essential for gaining visibility in a crowded digital space. A low boosting budget means businesses are whispering in a stadium where no one can hear them.

Benefits of Investing in Digital Marketing: Data and Case Studies

Strategic investment in digital marketing is not just an expense; it’s a powerful revenue engine that ensures business growth. By applying proper measurement and multi-faceted strategies, the maximum benefits of this investment can be reaped.

The True Meaning and Measurement of ROI (Return on Investment)

To measure the effectiveness of digital marketing, one should go beyond surface-level metrics like clicks or impressions and focus on actual outcomes such as Conversion Rates, Lead Quality, and Customer Lifetime Value (CLV). AI-powered tools can be used for predictive analytics, enabling marketers to anticipate user behavior and adjust campaigns proactively. Emphasis should be placed on measurable results aligned with business objectives.

A case study showed that implementing SEO increased a retail company’s organic traffic by 70% in 6 months and conversion rates by 35%. Pay-Per-Click (PPC) advertising yields quick results; a case study demonstrated a 200% ROI and a 50% increase in sales during the promotion period through a PPC campaign. Email marketing provides an incredibly high ROI, with a return of $36 for every $1 spent. Content marketing can generate 3 times more leads per dollar spent compared to traditional methods.

This data highlights the indispensability of “measurable impact.” To answer the businesses’ initial question, “How much will sales increase?”, it’s crucial to strategically measure results beyond just $5 boosting. This section provides the language and metrics (KPIs) to strategically answer that question, proving that when done correctly, digital marketing brings measurable sales and growth.

Examples of Successful Campaigns and Their Strategies

There are many examples of digital marketing success in Bangladesh. AD65’s case studies prove this. They have run successful campaigns for brands like Sandalina Bridal Series, LIC Bangladesh, BTCL Alaap App, Sandalina Bold Women Campaign, Shezan Sauce, Kolson Macaroni, Vision Emporium, Sun Drinking Water, Sun Chips, Action Aid, Bombay Sweets, Ahmed Food, and Legion Mehendi.

Red Sparrow Digital achieved 93% business growth for Thai Medi Express, 92% sales growth for Dr. Batra’s, significant ROAS (Return on Ad Spend) for Glowmaxx Laser & Aesthetic Clinic, and success stories for Amber IT and Surecell Medical BD. Marketorr has generated 3x ROI and 3.2 million+ leads for over 120 businesses.

For startups, social media marketing and networking significantly impact business success, explaining 75.3% of performance outcomes. This success is attributed to social media usage, data analysis, collaboration with supporting organizations, cost-effectiveness, and broad reach. Multi-channel marketing, combining email campaigns, social media ads, and SEO-driven blog posts, increases brand visibility and creates a seamless customer experience. Content repurposing and user-generated content (UGC) help build brand credibility cost-effectively.

These examples highlight the benefits of a “strategic channel mix.” Success is not limited to boosting on a single platform. It’s about a holistic strategy that combines organic (content, SEO) for long-term authority and paid (boosting, PPC, email) for immediate reach and conversions, tailored to the audience and platform. This directly addresses the narrow “boosting” mindset.

The Role of Digital Marketing in Enhancing Brand Awareness and Customer Relationships

Digital marketing not only increases sales but also plays a crucial role in enhancing brand awareness and customer relationships. It ensures increased customer interaction and brand exposure. Interactive features on social media platforms like polls, Q&A, and live-streamed shopping events create two-way communication with customers, boosting engagement and trust. Personalized messages and targeted campaigns increase conversion potential. Direct interaction with customers and building a strong community are possible, which fosters long-term loyalty.

Addressing Challenges and Future Directions

The existing challenges in Bangladesh’s digital marketing landscape hinder businesses from achieving their full potential. Overcoming these challenges is essential for building a robust digital ecosystem.

Lack of Skills and the Need for Training

A significant barrier is the lack of digital marketing skills among SME owners and employees. This knowledge gap reduces sales effectiveness and leads to many business failures. Low digital literacy and skill gaps are systemic issues. The rapidly evolving nature of digital marketing necessitates continuous learning and adaptation.

This situation highlights the “chicken-and-egg” problem of skills and investment. Both skill deficits and budget constraints are major challenges and are often intertwined. Low skills lead to ineffective spending, which reinforces the perception of marketing as an expense, and consequently, budgets for training and skilled personnel are limited. Solutions include training, workshops, marketing consulting services, and partnerships with universities. Training programs should emphasize not just tool usage, but also ROI measurement and strategic planning. Financial support should be linked to structured marketing plans and performance tracking.

Adequate Budget Allocation and Long-Term Planning

Financial limitations are a major obstacle for SMEs. Insufficient budgets for advertising and promotion put them at a disadvantage in competition. A lack of strategic vision often makes digital marketing a “temporary solution”. The SME Foundation has sought an allocation of Tk 5.0 billion in the 2025-26 fiscal budget to support the SME sector’s development. The government should invest in building digital platforms where SMEs can showcase and sell their products.

Role of Government and Industry

Beyond individual business efforts, a “regulatory and infrastructural impediment” creates a challenging environment for digital marketing. High tax burdens on telecom services (over 54%), widespread 2G networks, lack of data centers and cache servers, and stalled 5G implementation are part of this impediment. The absence of social media companies’ offices in Bangladesh affects tax revenue and the bargaining power of local content creators. Unethical advertising practices and repressive laws can damage market credibility. Policy support is needed to ensure service quality and eliminate monopolies. Collaboration between government and industry is essential to create a truly enabling digital ecosystem.

Debunking Common Digital Marketing Misconceptions

Many businesses suffer from an “effort versus strategy” misconception. They believe simply posting on social media is enough, or that digital marketing always guarantees quick results. The idea that SEO is no longer relevant, or that digital marketing is only for large businesses, is also prevalent. Even the misconception that SMM panels are only for cheating or are illegal exists. It is crucial to dispel these misconceptions. Many businesses confuse

activities (creating content, posting) with strategy. Without a clear strategy, proper targeting, and adequate promotion, even good content will fail to deliver results, reinforcing the “expense” mindset. The focus of education should shift from “what to do” to “how to do it effectively and why.”

Table 2: Common Digital Marketing Investment Challenges & Impact (SME Context in Bangladesh)

Challenge Impact Source
Limited technological expertise/digital literacy Hinders full potential, poor sales, business failure, and difficulty using tools.
Budget limitations/financial constraints Insufficient advertising/promotion, temporary solutions, inability to compete, and slow growth.
Inadequate infrastructure/connectivity issues Disrupts effectiveness, unreliable campaigns, and limited reach (especially in rural areas).
Short-term thinking/”expense” mindset Prioritizes immediate sales, lacks clear goals, wastes time/opportunity, unpredictable revenue. User Query
Content-promotion disconnect Wasted content creation efforts, limited visibility, and low ROI despite good content. User Query
Regulatory & ethical environment Lack of oversight, tax revenue loss, ethical concerns (misleading ads), and trust deficit.

 

Conclusion: A Call for Strategic Change

The growing interest in digital marketing within Bangladesh’s business sector is commendable. However, to translate this interest into genuine success, it is imperative to shift from an “expense” mindset to an “investment” mindset. Limiting boosting to $5-$10 or merely creating content without proper promotion is an ineffective strategy that harms businesses in the long run.

Digital marketing is a powerful revenue engine that can bring unprecedented growth through the right strategy, adequate investment, and measurable goals. Bangladesh’s vast and growing digital user base, especially the expansion of social media and e-commerce sectors, presents immense opportunities for businesses. To leverage these opportunities, businesses must:

  • Adopt a long-term perspective: Go beyond immediate sales to focus on brand building, customer relationship development, and customer lifetime value.
  • Allocate sufficient budget: Invest a specific portion of revenue (e.g., 11-20% for growth) in digital marketing, based on measurable results.
  • Emphasize quality content creation and promotion: Not just create content, but also ensure it reaches target audiences through adequate boosting on the right platforms.
  • Invest in skill development and training: Acquire knowledge about new digital marketing strategies and tools, and train employees.
  • Make data-driven decisions: Analyze metrics like conversion rates, lead quality, and ROI beyond clicks or impressions to refine strategies.
  • Collaborate with government and industry: Work together for digital infrastructure development, policy support, and maintaining ethical standards.

The future of digital marketing in Bangladesh is bright. To realize this potential, every business must embrace digital marketing as a strategic investment, where every dollar spent is backed by clear objectives and measurable outcomes. This will not only ensure business growth but also propel the country’s overall digital economy forward.

 

 C. Basu.

 

 

 

Bibliography

C. Basu

a marketing professional with over 10 years of experience working with local and international brands and specializes in crafting and executing brand strategies that not only drive business growth but also foster meaningful connections with audiences.

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