The marketing budget is often the first to be cut when times get tough but it shouldn’t. It is a critical component of your business and without it you will struggle to grow your business. Therefore, it is critical to look at what it entails and how you can create an affordable marketing budget for your business.
A marketing budget is made of two components time and money. These both need to be invested to make a successful marketing campaign. How do you work out how much money and time you need to spend on your marketing budget? Here are four questions to consider:
What are your business goals?
The first question to consider is what are the business goals you wish to achieve? Do you want to make more sales? Do you want to create greater brand awareness? Do you just want to stay top of your consumer’s mind? These goals will affect the amount of money which you invest into your marketing strategies.
What type of business do you own?
Depending on the type of business will depend on the amount of money you need to invest in your marketing plan. If you are a startup, you could spend up to 7% of your sales to help create awareness of your products. If you are a business who markets to other businesses or a small niche market your budget will be smaller than someone who is in retail or has a global audience.
Who is your competition?
Depending on who your competition is will depend on how much you need to spend on your marketing. If you are the only coffee shop in town then you will need a limited budget but if you are one of many then you will need to increase it.
Who is your market?
Knowing who your consumer is, is critical when establishing your marketing budget. If your market is older and is not fussed with digital media you may need to invest in traditional methods of marketing. Whereas if your market is young and consistently glued to their phones then you will be more involved with digital media.
When you have answers to these questions you can work on your marketing budget. You will then understand which types of marketing media you need to use to promote your business. You will know whether it will be an investment in time or money which will bring you the leads that could convert to sales.
By having a marketing budget, you will also be able to assess which marketing methods create a good return on investment and which do not. Furthermore, this will help you to ensure that you are investing the right amount of money and time on the media which proves to be positive instead of wasting money on investing in marketing opportunities that offer no return on investment.
It is important to remember that marketing is an investment into your future, and therefore needs to be assessed with as much care as your investment into the actual product itself.
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