A Guide for Small Business Owners: Setting a Marketing Budget
Running a small business is no joke. Considering the competitiveness of the modern market, the last thing you want to happen is to waste time and money on unnecessary things. This is where creating a marketing budget comes in. Marketing campaigns are costly expenses, which means your small business can go downhill if you invest in the wrong things.
As a small business owner, it’s important to ensure that you’re spending your money on things that will make your brand more competitive or relevant to the market. In general, a marketing budget includes expenses like sponsored website content, paid advertising, marketing automation software, and other marketing-related projects. Read on to learn how you and your team can come up with the proper marketing budget.
Join Conference Room: An accounting, personal finance, and entrepreneurship community. Video, blog posts, live chats.
Contents
Go through your sales funnel
Before anything else, you need to dive deeper into your target customers. Determine your target income level, age group, geographical area, and the brands they frequent. Gathering details about these simple things can guide you through your sales funnel. The sales funnel is essential for monitoring revenue cycle outcomes and creating a more accurate marketing budget.
To get a better grasp of your marketing needs, you need to check a few things. These include the number of leads generated, site visits, and leads converted to customers per month. You’d also need to find out the average revenue or value for the new deals, as well as the opportunities that come with them. Diving deeper into your sales funnel can help you determine how much you’re spending on every tactic and if they’re working as expected.
Determine marketing channels
Determining your marketing channels is significant for creating a working budget that will give you the best revenue return. One major category is digital marketing, including online content marketing, social media marketing, email marketing, and search engine optimization.
On the other hand, inbound marketing includes videos on YouTube, blog posts, SEO, and other forms of content marketing. This often overlaps with digital marketing, so take note of that.
There’s also outbound marketing, which is usually combined with inbound type since it’s hard to track on its own. Examples include promo products, trade shows, press releases, direct mail, and radio or TV advertisements. Decide which categories you want your marketing strategy to promote heavily. That way, you can better identify the costs associated with each of the channels – for example, should you wish to get some promotional booklets to mail out, take to a trade show, have on display at reception for people to take, etc., you will need to explore your various options for booklet printing in Ottawa, ON, or wherever it is you are, so that you can be sure you find the very best option for your budget.
Identify operational and seasonal costs
The third step is to list down your operational costs, both your anticipated and current ones. This should be a no-brainer when it comes to setting a marketing budget.
To save effort and time, create a template or a spreadsheet that your team can easily use when creating or updating your monthly marketing budgets. Some of these costs may include content outsourcing fees, social media campaign expenses, sales tax, web hosting, and professional fees. Be realistic with your operational costs. This is vital for knowing exactly how much money is coming in and going out.
Furthermore, don’t forget to consider holiday or seasonal events. They also have a big impact on where and how you spend your marketing money. Determine if there will be changes in product creation and shipping costs during such special times. These may include cultural and national holidays, industry events, and even the weather. Check your marketing calendar for reference.
Look into strategy prices
Besides channel expenses and operational costs, you’d also need to account for the strategy prices. These costs will include the fees you pay for hiring an online marketing agency or freelancer or if you’re running the campaigns without outside help. If you’re letting your in-house team handle the ad campaigns, some costs to include in your budget are marketing materials and salaries.
Are you planning to hire freelancers in the future? Check if they’re paid on a per-project basis or by the hour. Some freelancers may charge extra costs for the software or platforms they’re using.
If you’re hiring a digital marketing company, there are a range of service rates you need to take note of. For instance, a monthly social media service can cost around $250 to $10,000, while a content marketing service per month can cost you $2,000 to $20,000.
Promoting a small business in this digital age can be daunting and expensive. For such a reason, it is highly suggested to craft a marketing budget that is good for your business. It can help you properly allocate your funds, stay on track financially, invest in your business’ growth, and plan for the long term.
Go to Accounting Accidentally for 500+ blog posts and 450+ You Tube videos on accounting and finance.
Good luck!
Ken Boyd