Research has shown that a majority of companies have increasing budgets, with only roughly 9% experiencing a decreasing budget. With your budget laid out before you, you’ll have a roadmap of where your growing company is headed and how much luggage you can need for the next year.
Understanding What a Marketing Budget Is
It’s essential that you draw up a written plan to accompany your marketing budget in order to know exactly when and how to execute your specific strategies. When you create a budget, you’ll list your tactics, costs and the results that you’re expecting to yield. You’ll also want to make sure that you account for administrative costs, such as postage and subscriptions. Just like when you drive a car cross-country, when you plan out a marketing budget, you have to think about the long haul. You must determine how many miles you have to drive, so to speak, before you need to switch lanes or take an off-ramp. Otherwise, there’s a chance you might be lulled into a false sense of security while coasting and miss your turn. In the business world, this can have devastating long-term consequences.
Creating a Sound Plan
The first thing you need to know about creating a sound marketing plan is that they take time to prepare, which is why it’s good to get started on them early. Specifically, you’ll want your plan to include:
- A set of dates to examine the progress you’ve made
- A list of financial goals
- A brand strategy
- A revenue generation strategy
- A positioning plan
- A general overview of your products and/or services
Make sure that you include your employees in the budgeting process. They should know which goals they need to set for themselves, so that they can start making plans of their own. Including employees with the planning process is that they can help you generate new ideas and goals. When everyone is on the same page, you and your company stand a better chance of success.
Central Concepts of Your Budget
Creating marketing budgets involves setting annual objectives, which include both strategic and quantitative goals. To simplify the process, I like to split the budget between brand awareness, lead generation, partner marketing and administrative activities.
At the beginning stages of drawing up your budget, it’s good to revisit your brand strategy, product roadmap, pricing strategy and distribution channels. How does your current position in your industry influence your overall budget? What is it that sets you apart from all other companies in the marketplace, and how do you plan on conveying that to your target audience?
Take a long and honest look at your line of products and services and ask yourself if you’ll need to devote space on your budget to make your products or services stronger. Will you need to hire more marketing support, sales representatives or specialists to help you move your products or services?
Your next step should be to map out your top three marketing campaigns. Even if you have several campaigns, it’s best to focus on your top three. Always set aside a testing budget for new tactics, new products and unforeseen competitive situations. Once you’re done with your marketing budget and your written plan, regularly revisit your plan throughout the year to make sure you’re on track.