The Importance of a Marketing Budget and How to Make the Most of Yours
Most people in business understand the importance of creating a modern corporate identity. This includes a good logo, website, and other marketing materials. After these basics are met, however, many companies fail to follow through with a strategy to improve their online presence. They might think that by not spending money on marketing, they’re saving money. In reality, they are losing out on a huge resource for new business.
It’s crucial to have an ongoing plan to spread your ideas or products as much as possible and to set aside a marketing budget to move the plan forward. For most businesses, the marketing budget will be tight, so efficiently allocating funds is crucial for maximizing profits. It’s important to set up a monthly or yearly budget as a guide to ensure that you stay on target with estimated costs and actual costs.
What does a marketing budget include?
Your marketing budget will include the costs of all the advertising you do for your company. There are numerous types of advertising to take advantage of, both online and otherwise. Online resources are increasingly important, including your own website management, search engine optimization, online advertisements, and social media campaigns. Newspapers, magazines, mailings, billboards, radio and TV commercials, and trade shows are all traditionally good resources to consider, depending on your type of business.
How much should a business spend on marketing?
Unfortunately there is no easy answer to this question, because it depends on your business’s size and type of industry. In general, companies are told to spend between 2% and 10% of net sales. Some spend up to 20% of sales, but the average is between 4-6%.
Where should I start?
The first step is to make sure that your marketing basics are covered. Do you need to develop or refine your branding? Do your logo, website, and other marketing materials look professional and up-to-date? Is the look and feel of your marketing materials consistent across all platforms?
Next look towards ongoing expenses. It’s important to maintain and promote your brand to your target audience to continually bring in new business. If you don’t keep your website and materials current, you will lose ranking from search engines and interest from potential customers.
What should I do after the basics are covered? Focus!
It can be easy to feel overwhelmed by the sheer amount of options for online marketing, so it is crucial to focus on what works best. Start small, and only scale up when it becomes profitable to do so. When you feel like expanding, you can experiment with different campaign types on the same platforms you are already using or branch out to other resources.
When you do spread out among various platforms, make sure your campaign communicates the same message throughout. This cuts down on the time it takes to come up with content for each resource while making sure your message is clear and expresses exactly what you want to your viewers.
Google Analytics is an extremely useful tool for keeping track of various statistics about who is visiting your webpages. Using this information, you can apply the “80/20 Rule”. To do so, you identify the top 20% of your online traffic sources that generate 80% of good results for your company. Then you focus your budget on those areas.
You definitely shouldn’t try to spread your marketing across 100% of all online resources. That’s an impossible task, since new possibilities spring up every day. Instead, focus on the major contenders that allow for full control of both targeting and cost such as Google+, Facebook, and Twitter. The more you can control what you spend your budget on, the easier it will be to cut out areas that aren’t working as well.
Cross-channel remarketing is a more advanced technique that helps redirect viewers to your online resources even if they weren’t initially converted into customers. For example, if someone clicks on an ad in Google, they will now see similar ads in Facebook, Twitter, and other platforms they visit. This strategy significantly increases the effectiveness of modern advertising campaigns.
Marketing is a basic tool for helping a business grow and prosper. Many companies fail because they don’t allocate enough funds for their marketing budget. Efficiently spreading your business’s information around brings in new customers, and the online resources available these days can help you get the word out faster and further than ever before.