Across all industries, companies are spending between 6% and 10% of their overall revenue on marketing activities. Of course, this varies widely depending on many factors including industry, company size, revenue, company age, whether it sells a product or a service, and whether it’s B2C or B2B.
When considering what your marketing budget should be in the new year, you’ll want to develop a marketing plan with SMART* goals. Your marketing budget will accompany the plan. A well-thought-out marketing budget will be your resource for achieving your goals and improving your bottom line.
Using SMART goals will allow you to track your efforts and see how much progress you’ve made.
The budget (and plan) should be detailed enough to understand that every item or process you go through is related to the bigger-picture goals and objectives. It shouldn’t just be about selling products or services, but also about increasing brand awareness and nurturing relationships with consumers.
The biggest question to ask yourself is what are you actually going to be doing in terms of marketing activities. It usually helps to look at your calendar. Are there specific times of the year when you sell a certain product or service? Is there a specific trade show or conference you host or attend?
It is crucial to map these out to determine what supporting marketing activities need to be done to make these events successful. This planning exercise will dictate what you need and how much money it will take to carry out those activities.
Milestone celebrations, webinars, vlogs, national events, fundraisers
A marketing budget helps you anticipate the costs of various marketing activities and endeavors. It should go hand-in-hand with your overarching business plan.
You need concrete data to support what gets written down in your marketing budget. How do you know a tradeshow booth costs $2,500? You better have gotten a quote from a reputable booth vendor to get that number. You must understand the costs you incur as a business.
Sometimes this means working with the accounting department to figure out what you’ve spent in the past and identify the total costs of certain activities/events. Think about software costs, too like social media platforms, scheduling programs, or your CRM.
Use your experiences and analytics to get a basis for your budget, but then do some research. Think industry standards, competitor efforts, vendor price lists, digital platform costs, etc. Don’t forget to talk to your vendors about what you may want to do, too. They can help you build out your plan and budget for the year. You’ll want to make sure you can reach the goals you’ve set with the budget you write down.
Digital spend to upgrade your website, conduct e-mail marketing, and purchase software
Paid search (PPC), social advertising, and digital display
Brand awareness activities and SEO strategy
Once you have a marketing budget in place, it will be a breeze to guide your team to complete your upcoming activities. The roadmap is there! This will make your organization more successful and functional in the long run.
Lori is a self-proclaimed chaos coordinator charged by positivity and spreadsheets. She has a decade of marketing experience and loves strategizing marketing plans and building content to drive results.
