How to set your marketing budget
Start small and build
One of the hardest things to do is to start something especially when you want to know how to set your marketing budget. Often the idea of starting something new is so daunting that we fall into the trap of not doing anything. When it comes to starting a marketing budget the issue is compounded by what you can afford. Most small businesses will have established a certain level of reputation that will bring them an amount of business as a normal part of their day to day activity. If you are in the situation where you want to increase business, then you will need to step out of your normal activity.
Start with a plan
Having a marketing plan will help you establish what you want to achieve (see this article for more information How to start your Marketing Plan). But starting a budget for that extra activity can be a totally different and daunting experience. To help you with this process we have some simple tips on how to set your marketing budget.
1. Ask yourself how much money can you spend on marketing?
Most small businesses don’t know how much they could be spending on marketing. Find out how much you could possibly allocate to your marketing budget. It could be as little as $100 per month. If that is the case then you have taken the first steps on how to set your Marketing budget.
2. Find out what you can do with this money
Ok so you now have a figure in mind. Research and talk to people about what that money can give you. Talk to marketing companies and agencies about what the options are. Although many of the larger agencies will not want to talk such low numbers. There is a saying “money talks”. An agency will tell you if you aren’t spending enough for them to help you. That’s ok don’t feel bad about this. At least then you will know if they will help you or not.
You can talk to us because we will help. That’s what we are here for!
I once talked to a small business who said that he only had $1500 to spend on marketing for the year. Instead of turning him away we worked out what he could be doing and gave him the options. Most of these options he could do himself, he just didn’t know they were available or the done thing. What a lot of agencies don’t understand is that not everyone has the funds available and therefore can only start small.
3. Put away that money, no matter how small
So now you have your budget, put that money aside every month. It is like your family budget a certain amount is always spent on food, or rent or whatever, but that money is never touched. By putting that money aside, it means that you can’t touch it. So, if something comes up then you need to find the money for it elsewhere. This money is budgeted marketing only. Once this is established you will start to gain a respect for the budget. It is often the case that you will find the money.
4. Plan for what you want to achieve for the next six months
As a part of your marketing plan work out what you want to achieve. Is it more sales, more leads, brand recognition or business growth in new areas? Remember not every business has the same needs.
5. Add to that budget – putting that money aside.
When things get better and you start to get a return (sales) put more money aside for your marketing budget. In this way, you can build a larger budget that will allow you to do greater things.
We must understand as a small business money is a very tight and precious thing. If you need to start small then do so, but it is important that you do something.