How to Manage Your Marketing Budget

It can be difficult to allocate the funds for a proper marketing program. It may seem more logical to spend that money on inventory or product development, but marketing is a very important part of your business model. What good is having an awesome product if no one knows about it?

So now that you understand the importance of having a marketing budget, how much should you allocate for you marketing and advertising needs? This all depends on the size of your business, the industry you’re in, and the stage of business development. You may need to look up the average percentage of sales spent on marketing for businesses in your industry. You can then cater this number based on your business’ individual needs. For example, if your business is just starting out, you will need to spend a bit more on marketing to establish your brand. A general rule for small businesses is to spend between 5-8 percent of revenue on marketing and advertising.

What should be included in your marketing budget? Your marketing budget should cover paid advertising, promotional materials, production costs, and technology costs. Your paid advertising will include any ads you have to pay to run, such as TV, radio, PPC (pay-per-click), banner ads, Facebook boosts, etc. Promotional materials are brochures, flyers, magnets, etc. you would need to have printed to give away. Production costs will be used to pay your advertising coordinator, social media manager, graphic designer, event coordinator, etc. Technology costs will cover your website and any other technologies that help promote your business.

Now that you know how much your budget should be and what you should spend it on, let’s look at how to spend it. You need to have a marketing plan. Your plan should include your goals, how you plan to reach those goals, how you will implement the plan, and how you will track your results. In your plan, you should outline the costs of fulfilling each objective and exactly how you should do it.

This seems a little complicated. We recommend hiring an experienced marketing professional to help you fulfill your marketing needs. It can be confusing to figure out how to correctly budget and implement your budget if you are new to the marketing arena. A marketing consultant can help tailor a plan and budget to your business’ individual needs. This person can also help you to track your results and tailor your actions based on what is effective for your business.

We understand that it can be difficult to know how to reach your marketing goals. Although marketing may not have direct, tangible results like business aspects such as product development, it is a very important aspect of your business strategy. We hope our tips have helped you determine how to plan your marketing budget. If you would like a marketing plan tailored specifically for your business, please feel free to contact us today.

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