Your marketing budget is something you have to properly take care of. So, do you know how to effectively manage your marketing budget to get the most out of your marketing investments?
Planning is a big part of our lives. It makes us have our goals in perspective and pursue them little by little until we reach what we want. When it comes to our businesses, a big part of the success can be contributed by defining a detailed marketing plan.
Your marketing budget should include the costs for a lot of things in the area of marketing. Such things you should include are advertising, website developments, and public relations. You should also include stuff like the cost of employing staff that will be handling the marketing related work.
How To Effectively Manage Your Marketing Budget
Your marketing budget should be an integral part of your business finance. However, it’s not just about earmarking a certain amount of money for your marketing activities. In essence, there is more to marketing than just the marketing strategies you have adopted.
You will also have to be able to manage your marketing budget in a way that you will be able to get better returns of investment. See our previous article on digital marketing essentials for every new entrepreneur. Below are some useful tips for you on how to effectively manage your marketing budget:
#1]. Set up your marketing goals
Setting up marketing goals can sound like an easy thing to do. But once you get into it, you will find it very demanding. You need to set up realistic goals that you can achieve with your limited budget.
Your goals should challenge you, but they still need to be reachable. Once you determine your goals, you need to get specific about them and choose the priorities. Allocating your funds towards the priorities on your goal list should give you the best results possible.
Some people do this drawing the goals and then listing everything that needs to be done in order to achieve them. There are so many great automation tools out that that you can use to automate your business processes if you decide to go through this way.
#2]. Determine your overall marketing budget
Marketing is a medium through which you can generate sales and take your business to the next level. However, you need to have defined goals, and once you have this, you need to determine how much money you have approved to work with.
It is not recommended that you do this with estimates, but with real, concrete numbers. Usually, most of the marketing budgets out there are based on a percentage of the revenue. This percentage varies from company to company, so you need to figure out your own, based on what you’re planning on accomplishing.
If you just want to keep your current market share, 1-2% of the revenue will be enough. For moderate increases, you can use 3-4%, and if you want a big growth, somewhere between 5-10% or even more will be needed.
Choosing the right percentage of revenue that you can allocate to your marketing budget depends on a lot of things such as the size of your company, the industry your business is in, the brand recognition and more.
#3]. Cleverly assign your budget
This is where it gets confusing and tricky. After you have determined your goals and chose your budget, you need to assign it properly to the different categories of marketing. Assigning a monthly budget can be a hard task considering that the company’s income can vary throughout the year.
Use your past experiences to define what works best for your line of work. Think about which marketing channels can allow you to reach your target audience, and allocate your funds towards those channels. Be aware that the point of marketing planning is to increase attention to your business and eventually increase the company’s profits.
If the marketing plan does not increase revenue, then you should try something else. Compare the previous performance and the performance after implying the marketing strategy. The changes in the revenue will indicate if this is working or not.
#4]. Consider unique branding
Not every little company out there can have a big marketing budget. Maybe you’re just starting out or you still have a small business. You can still succeed; you just need to get a little bit creative with the tools that you already have.
We are all aware that small businesses cannot compete with the multi-dollar corporations that are their competitors. Opposing with them on the market cannot be by direct competition, so you need to be innovative and create a unique branding for your product that will differentiate it from your competitors.
This will be a great marketing strategy that will require less budget than normally when going head to head with the big leaders of the industry. Do you have more tips on the subject? Comment below and let us know!
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How much of your revenue should you allocate to your marketing budget? 10%?