Setting your marketing budget for 2010
It’s that time again. (Collective sigh/groan.) Time to get the 2010 budget together for your business. In light of the challenges of 2009, budget planning may be even more stressful than usual this year. Although it may seem nearly impossible to stretch your businesses’ money, you must be sure to budget for marketing next year.
Marketing is one of the best ways to bring money into your company. In fact, marketing is the only type of business expense that comes with an expected ROI (return on investment). So, put some of your businesses’ money into marketing! If spent wisely, you will see your money (and maybe more) come back to you. (It’s been well-documented that businesses investing in marketing tend to fare better than those that do not.)
How much should a business budget for marketing? Well, the answer is the very unsatisfying “it depends.” The percentage of revenue spent on marketing varies considerably. I’ve seen companies invest less than one percent, and I’ve seen companies invest 30 percent of their annual revenue. (I don’t recommend either, by the way.) The biggest variables are location of the business, competition within the industry and the level of risk aversion in the owner of the company. Is your business in a big city? Is your industry saturated? Do you think sky-diving sounds like a good time? Your business will probably the higher end when budgeting for marketing. On the other hand, maybe your business is in a non-competitive industry and the thought of wasting a dollar for a soda makes you nauseous. Your business will probably sit a little lower on the marketing budget scale.
Once you decide how much to set aside for marketing, it’s time to figure out how to spend the money you’ve allotted. This is where most business owners really run into problems. Many business simply want to do what was done the year before. This may be a good idea if the marketing projects were successful. However, if they weren’t successful, or just ho-hum, it may be time to invest in a new marketing plan.
When planning to use your marketing budget, take a good, hard look at the following. It will begin to be very obvious how to spend your marketing budget and get the ROI that you’ve been wanting.
1. Goals for the business. What are your goals for your business? Are you looking to grow? Any plans to expand into other cities, hire new employees, create a new product or offer new services? If so, the sky is the limit with your marketing campaign. this is the time to get aggressive! Maybe you’re wanting to hold steady in 2010. If so, keep your marketing budget where it was for last year (including a little extra for inflation, of course). It could be possible that you’re looking to downsize a bit. This does NOT mean that you should cut out marketing. It simply means that you need to figure out the best way to spend your marketing dollars efficiently. Sit down with a pen and paper (remember those?) in a quiet place and really concentrate on what you want for your business in 2010.
2. Target demographic. To whom are you trying to pitch your products/services? Are you aiming for 30-somethings? (Try Twitter.) What about women over 55? (Facebook is the answer.) How about teenagers? (I see a texting campaign in your future.) Interested in selling to mothers with small children at home? (Blog, baby, blog!) Your demographic will help determine where the marketing budget should be allotted.
3. Current/previous marketing efforts. What did you do last year? How about the year before? Were any of the campaigns successful? Look back on the tracking that you did for the projects. If they worked, great! If not, it may be time to tweak them a bit. Don’t be afraid to try new things, but it’s important to look at what has worked historically for your business, as well.
4. What is your level of expertise and how much time can you devote to marketing? How much do you know about blogging and social media? Do you have 2-3 hours per day to devote to marketing efforts? If you (or an employee) is a marketing whiz, and you’ve got time to spare, you’re in great shape. However, what if you’ve never been on a blog and you’ve only heard about Twitter on a commercial? Or, worse yet, you have absolutely NO time to work on any marketing projects. Never fear! There are professionals everywhere who are ready and willing to help your company a success. However, those professionals cost money. Be sure to figure the cost of either hiring an employee with marketing knowledge or bringing on a consultant to help with all things marketing.
No matter how you decide to spend your marketing budget, be sure that you HAVE a marketing budget. Need help? Contact us!
October 14th, 2009 at 1:31 pm
[...] calendar year, then you’ll be in the middle of planning and trying to figure out how much to spend on marketing. Business planning and budgeting aren’t exactly on anyone’s list of [...]
August 10th, 2011 at 6:08 am
In my opinion, yes. Functionality is more important than design in most cases. That said, design is an important aspect of any site. It helps to build trust. Many website users will not submit any information or buy from a site with a horrible design. Thanks for the question!