It is the time of year to begin thinking about your yearly budget. This is a headache for many business owners, and it is time-consuming. With the many things you must consider, you need to pay close attention to your marketing budget.
To properly plan a marketing budget, there are a number of crucial considerations to think about. You need to give some serious thought to your overall business goals and how these will figure into your marketing budget. This is a great time to take stock of what has been working and what has not been working in terms of marketing strategies.
Your marketing budget also should include considerations like public relations and new marketing channels for your company. These are areas of marketing that require special attention when it comes to mapping out a marketing budget.
What is a marketing budget? Why does your company need a marketing budget? And what are some important things to think about when working out a marketing budget? This guide will walk you through some of the main ideas for a marketing budget.
What is a Marketing Budget?
A marketing budget is a detailed outline of all the money a business can set aside and spend on any marketing-related projects for the year. The marketing budget is sometimes projected for a quarter, but it is still the list of all marketing activities a business intends to take on and the money set aside for these projects. A marketing budget can include things like paid advertising, sponsored web content, new staff for marketing in-house, web and blog domain names, and marketing software.
A marketing budget needs to follow a reasoned understanding of projected profits versus expenditures. The goal is to create a marketing budget that will bring in more money than you spend through the marketing strategies a company employs.
Why does every business need a Marketing Budget?
Marketing is no longer an optional component of successful businesses. To remain competitive, you must have some kind of marketing strategy to garner the attention you need to keep growing your business. Marketing strategies cost time and money. Even if you do most or all of your marketing yourself as a small business owner, there are still expenses. Paid advertising and domain names are expenses. This means you need to budget some of your income and assets for marketing purposes.
A marketing budget ensures that you are able to track the money you spend on marketing and the specific types of marketing strategies you are using. This type of careful planning makes it possible to keep track of where your money is going and what kinds of things are working. With a detailed and careful marketing budget, you will be able to see which marketing strategies are turning into conversions and which are not.
How to Plan a Marketing Budget?
There are a few important considerations when drafting a marketing budget. The thing to think about for planning your marketing budget include:
Understand your company’s goal
A marketing budget is basically a plan for how you are going to attain specific goals. Determine your short- and long-term objectives. For example, maybe it is time for a complete re-branding project. If your company finds that it is time to effectively re-articulate a new brand identity, this will become your primary objective for your marketing strategies. You will need to budget for this kind of project accordingly. With a project of this magnitude, you will likely need the services of a professional marketing consultancy. Your marketing budget will direct assets and projected profits toward this goal.
Identify your current marketing budget
Map out your current marketing budget in detail. What are you currently spending on marketing, and how are these strategies working? Things to think about include:
- Paid advertising (Digital and conventional)
- Marketing staff. This counts whether it is in-house or with a marketing company.
- Virtual assets. Website, social media, blogs, and other digital assets.
- Events and promotional materials like trade shows, business cards, brochures, signs, etc.
- Advertising strategies such as product placement and special events.
Sometimes you will find that you have directed more assets toward certain strategies than necessary. When working out a marketing budget, this is an ideal place to determine how to better spend your money and time.
How is your money spent? is it working?
This is where you will analyze things like conversion rates, traffic data, and lead generation. A marketing budget plan should take into consideration those things that are producing results and which are not. By taking stock of these metrics, you can redirect your budget toward more profitable strategies. What you are evaluating is the return on investment (ROI) with your existing marketing budget and marketing strategies.
Polish your plan
With the data you generate and your detailed analysis of this data, you will be able to assemble a feasible and effective marketing budget. Make sure you evaluate your current spending and adjust this to account for your projected goals. It is also essential that you calculate a projected ROI to evaluate your marketing budget.
Marketing Budgets by Industry
Current projections show that most professional marketers see a steady increase in marketing budgets. It appears that businesses uniformly see a valid marketing budget as both necessary and profitable. To give you an indication of marketing budgets, look at various industries, these numbers are revealing. The percentage of company revenue for marketing budgets:
- Banking, Finance, Insurance, and Real Estate: 8 percent
- Communications media: 10 percent
- Consumer packaged goods: 9 percent
- Consumer services: 6 percent
- Education: 3 percent
- Energy: 1 percent
- Healthcare: 18 percent
- Manufacturing: 13 percent
- Mining and construction: 3 percent
- Retail Wholesale: 14 percent
- Service consulting: 21 percent
- Technology: 21 percent
- Transportation: 6 percent
As you can see, some industries set aside nearly 20 percent of their revenue for their marketing budget. They do this because it pays off.
Current Marketing Statistics
To give you a sense of how important a marketing budget can be, we can take a look at a few statistics that reveal the ways businesses are reaching consumers with their marketing budgets and marketing strategies. Some of the ways marketing are working can be discovered below:
Email forms were a leading factor in marketing campaigns. Email forms brought in a 15 percent conversion rate in 2020.
Professional marketers agree that keyword rankings and organic traffic were the top ways of measuring marketing success. About 50 percent of these marketers rated SEO as the top marketing strategy.
Carefully crafted content also proved to be crucial for marketing success. Content with less than 3000 words netted the best results. About 80 percent of marketing professionals use some form of content marketing.
Facebook remains the strongest social media channel for primary content distribution. 69 percent of Americans use Facebook and of these users, over 98 percent use the Facebook app for mobile phones.
How to Allocate Your Marketing Budget
To allocate your marketing budget you will need to envision your marketing plan. To achieve this, follow these steps:
Set marketing goals
Clear, detailed, and attainable marketing goals are crucial for your marketing budget. There is a general rule for this called SMART goals which are:
- Specific details that avoid vague ideas
- Measurable points of progress
- Attainable and realistic projections
- Relevant goals that stick to your business objectives
- Time-bound limits to allow for re-evaluations and to keep things on track
Plan for the year
Make a rough but realistic marketing plan for the years while keeping your budget in mind. Determine which channels are already working and which are worth more attention.
Channels to consider and evaluate include
- Search engine optimization (SEO)
- Pay-per-click (PPC) advertising
- Web design
- Conversion rate optimization (CRO)
- Email marketing
- Social media marketing
Consider how you will use these strategies and how they can help you attain your business goals.
Calculate costs and return on investment (ROI)
Take stock of your expected costs and the potential for the return on investment. You can estimate this by doing an accounting of your costs for your marketing budget ideas and goals.
Based on the previous steps, you can begin to split your budget according to the marketing channels that appear to have the best ROI.
Tips on How to Plan a Marketing Budget
Invest in content marketing and repurposing
Marketers all agree that high-quality content is a pillar of successful marketing. In developing your marketing budget, take stock of the resources you have for quality content. Also, consider repurposing content through channels you have not previously used for marketing strategies.
Understanding where your customers are
Key to developing an effective marketing plan and a successful marketing budget is a deep understanding of your customers. Harvesting data through marketing automation software can help you pinpoint where your customer base is derived.
Hire a marketing agency to help
With increasing competition and the real demand for a sound marketing strategy, it might be a good idea to include a professional marketing agency in your marketing budget. While it is certainly possible to handle marketing in-house, the demands of many marketing strategies can quickly prove to be a drain on your time and resources. HeyDay Marketing can handle virtually every facet of your marketing plans and strategies. HeyDay Marketing can even help you work out a marketing budget. From budget and planning to execution through every available strategy, HeyDay Marketing will provide the results you need from a sound and effective marketing plan.
Remove non-performing channels and focus on what works
Always audit and re-think your marketing strategies. Make sure you take stock of all marketing channels and cut back on non-performing channels. By redirecting your resources toward channels and strategies that work, you cut waste, increase conversions, and maximize your marketing budget.
Evaluate, evaluate, evaluate
To attain the maximum ROI you must constantly evaluate your marketing strategies. This requires continued monitoring and reevaluation. This is time-consuming, and the need to continually evaluate is a sound reason to hire a professional marketing agency such as HeyDay Marketing. Allowing professionals to pay attention frees you up to run your business.
How can HeyDay Help You Crush 2023 Goals?
HeyDay Marketing has professional staff who are knowledgeable and professional and can help you attain your business goals for the coming year. We have the online tools and the technical insights to help you with everything from your marketing budget to executing a marketing plan that will help you crush your goals for 2023.
HeyDay Marketing Services can help you set up strategies to optimize content and boost your search engine rankings. We can optimize social media channels so that you see the highest return on investment possible. We understand that a professional marketing agency is a serious undertaking, and HeyDay Marketing can provide your services that prove to be an investment rather than an expense.
We are a full-service marketing agency based in Miami, and it is our business to get your business the best return on investment from a professional marketing agency. This means we know how to place your business at the top of local searches in Florida. When potential customers search for local businesses, HeyDay Marketing Services knows how to position your business so that yours is among the businesses with the highest rankings.
Wrapping things up
Business owners generally have their hands full as we approach the new year and budgets for the coming year are chief among these things. As you tend to your marketing needs for 2023, you will need to pay close attention to your marketing budget.
As we noted above, a sound and carefully planned marketing budget is a necessity. And you can see from this guide that there are a great many considerations when drafting a marketing budget. From monitoring and analysis of current marketing strategies to evaluating new paths in your marketing plans, the details of a sound marketing budget can get complicated.
The details and steps for a good marketing budget are complex. To maximize your resources, it may be in your interest to hire professionals for your marketing needs, and this includes your marketing budget. We suggest you leave your marketing budget and marketing strategies to professionals like HeyDay Marketing. We can take over these time-consuming processes and allow you to run a successful business.