Small businesses invest about 1% of their annual revenue on marketing and advertising. While this might be the average, it might not be the best number for you to achieve your business goals. You have to learn how to create a marketing budget that is going to work for you and what you want to achieve.
Some advertising and marketing tactics might cost more or less and you have to decide which ones you want to employ. Continue reading this article to learn about creating a marketing budget for small business.
The 411 on How to Create a Marketing Budget
Whether you’re looking into advertising with TV ott, Twitter Ads, Facebook Ads or other means of getting the word out, having a budget will help you stay on track. Operating without a budget could get you into trouble. These tips will help relieve the stress of planning.
1. Research Who’s Buying
Don’t put the cart before the horse. When you’re spending money to get the word out about your product or service, you don’t want to waste it trying to convince people they need what you have to offer. You want to get the word out to people that need or want what you’re offering.
2. Match Your Spending with Your Revenue
While we saw above that many businesses only spend 1% of their annual revenue on advertising and marketing, depending on where your business is in its growth, you might want to spend a significant amount over 1%. When you’re just starting your business, your revenue is likely low. If you don’t get the word out, your revenue is going to stay low.
Spending 5,10 and even 20% of your revenue could be a good move depending on your goals. If you’re not sure the best course of action you might hire a consulting firm to work with you on figuring out the right percentage.
3. Be Wise When Spending
It’s easy to get distracted with interesting new advertising and marketing opportunities but don’t throw your money at everything. When you’re spending, make sure to note whether the cost is a one-off cost or if it is going to be a recurring expense.
4. Don’t Be Afraid to Change Course
While it’s important to stay the course with some things, throwing money at advertising and marketing tactics that aren’t working isn’t one of them. If you’ve tried something and it’s not working after a few months — throw in the towel.
5. Do More of What’s Working
What do you do with the money you have from the things that didn’t work out? Spend the extra money you have on the advertising and marketing techniques that are getting you the best results.
Increase Your Business Knowledge
Now that you know how to create a marketing budget, the world is your oyster. You can reach your target market with effective marketing and advertising and start moving those products and services.
Do you feel like you need more help? We have many articles that can help you grow your business. Browse our site, find your favorite section, drop a bookmark and come back soon for more great reads.