How to Define Your Marketing Budget

A brand-new year means brand-new customers, new sales objectives, and brand-new chances to grow your business. It’s an interesting way to begin the year; however, it won’t last long if your marketing budget isn’t right from the start.

Many businesses prepare their marketing budget based on the previous year and just how much they project to spend on marketing. However, with this strategy, you run the risk of holding your company back, investing in the wrong areas, or wasting efforts.

Want to have the best year yet? Read below the four critical ways to planning and carrying out a marketing budget that gets results.

Start With A Marketing Strategy 

Before you determine your marketing budget, align your marketing goals with your business’ strategic objectives growth vision. Say, you want to grow by 20%, but only wish to invest enough in marketing to get new business cards for everybody in your company. You’re probably going to be disappointed with your investment results.

It’s essential to establish a written marketing strategy that your executive, sales, and marketing teams are on board with. You need everyone to be driving their efforts in the same direction.

Set Your Marketing Budget

As soon as you’ve aligned your business objectives with your marketing goals, you’ll need to decide your marketing budget. From this, you can create a detailed marketing plan that supports your strategy. Basically, you’ll choose from three options: 

Lean Plan: In essence, you’re devoted to engaging and retaining current clients with simple tools and strategies. This plan is ideal for businesses aiming to preserve their market position and not having big growth goals. 

Target Plan: The objective here is to bring in brand-new prospects and maintain current consumers with innovative tools and strategies. This plan is perfect for businesses aiming to increase their market share and have moderate growth goals (10 – 15% yearly development).

Stretch Plan: Some businesses want to accelerate their results by using more resources focused on driving leads, conversion, and sales. To do this, you’ll need to use intricate marketing strategies and cutting-edge tools. The stretch plan is perfect for businesses with ambitious strategies to grow and increase their market share (20% or more annual growth).

Allocate Your Marketing Budget Dollars

Equipped with your objectives and a budget, you can now move on to developing your tactical plan to transform your marketing dreams into reality! 

How complex your plan is will depend on the marketing budget that you’ve set, but you ought to think about including these points into your tactical plans:

  • SEO and paid advertising
  • Social media promotions
  • Content deals, blogging, and email marketing
  • Lead conversion and nurturing
  • Traditional advertising

Decide on how much should be allocated from your marketing budget to each aspect of your plan. You can decide to spend more or less based on your direct competitors’ spending, the type of industry you’re in, and your specific objectives.

Execute A Marketing Budget Strategy

Once you’ve developed a strategy that supports your company’s goals, you need to execute it. And to ensure a successful implementation, you need a team of qualified online marketers, designers, and technical experts. You’ve got a few choices for developing this group:

In-House Marketing Team

To perform a complex marketing strategy, you need a team of individuals who possess excellent marketing skills, such as copywriting, coding, designing, social media management, paid search, and SEO. Unfortunately, no one person can efficiently do all these activities.

Big corporations would frequently work with an internal team; however, professionals can be pricey. Benefits, training, and computers alone could easily cost as much as $500K annually. For the majority of smaller businesses, this isn’t an option.

Freelance Team

Freelance employees can be a great choice for private projects. Skilled marketing freelancers can help fill out the spaces that your marketing director can’t provide, and they can help you immensely. 

But when you’re attempting to bring a long-lasting, complicated marketing strategy to its end, most likely, you’ll experience a series of ups and downs on the job. Since freelancers work on-demand for several customers at a time, they may not be there when you need them to be. 

You may need to hire extra individuals to cover all the functions to perform your strategy. Also, there’s the coordination and communication time you’ll need to handle all the freelancers. And when a freelancer carries on, they take all the knowledge of your job with them, forcing you to start over from scratch.

Marketing Agencies

Contracting a marketing agency has numerous benefits:

  • Services of top-notch marketing experts without sustaining the costs of employing, training, and managing several internal staff members
  • Responsibility from a team that wants to be successful and show the worth of its marketing services
  • Predictable expenses because your marketing costs are based upon a regular monthly retainer fee

Hiring a virtual marketing team involves typically an investment of $60K – $150K annually, which is significantly less than an in-house marketing department’s expense. Nevertheless, your group is off-site, which means interaction can be a little slower at times, and you may need to work via teleconferencing. Likewise, because marketing groups have several customers, you won’t have a claim on their time every minute of every business day.

Hybrid Team

The best choice may be a hybrid of a small internal marketing team that’s committed to one or two essential jobs, supplemented by an agency group that rounds out your marketing efforts. And the company can normally supply training and guidance to your staff, freeing you from this obligation. Make sure everyone knows their roles and duties, agree on metrics, and is committed to a shared vision for success. This can be an effective technique for implementing a solid marketing plan!

So, how do you make a marketing budget? First, create a strategy — know where you want to go in the next year, and then build a budget that supports those goals. Then, build or hire a team to execute that strategy and watch your goals become a reality. 

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