Making The Most Out Of A Marketing Budget

By: Vicki Bohlsen, Founder & President

I don’t think anyone would disagree that every company needs to budget for marketing, but there is a lot of debate on what that amount should be. Furthermore, there is additional debate on how best to get the most ROI (return on investment). 

“The U.S. Small Business Administration recommends spending 7 to 8 percent of your gross revenue for marketing and advertising if you're doing  less than $5 million a year in sales and your net profit margin is in the 10 percent to 12 percent range.” 

I do believe this formula is a good starting point, but it doesn’t account for the opening or expansion of a business, launching a new service or product, or for something unexpected like a worldwide pandemic. As a rule of thumb, consider 10% of gross revenue, give or take a bit either way.

When you consider all that goes into a marketing budget - expenses such as staff, website, content and creative development, and paid advertising, not to mention personalized services for marketing needs specific to your industry or brand – you can see why annual planning and measuring can’t be underestimated. 

Undeniably, the best ways to make sure that your marketing money is being well spent is to develop a comprehensive strategic communications strategy. Following a well-defined plan will help ensure you’re spending your marketing funds wisely and appropriately.

There is no cut-and-paste strategic communications plan for a company, but there are some tactics that are imperative no matter the size and/or type of company.

Website. All roads lead back to this main calling card for your company. The content on this owned asset needs to be stakeholder-centric with calls to action (oh, and it should be mobile friendly). Every other marketing strategy needs to be mindful of how the website complements and supports other marketing tactics.

Earned Media. Contrary to what some say, earned media is not dead. Rather, its definition has evolved to extend from publicity generated by media, bloggers and podcasters to include other organic methods such as social media fans, influencers and customers. There is nothing more valuable to an organization than the credibility of unbiased third parties telling your (sometimes curated) story.

Social media. Your social media platforms are owned assets, but you can earn or pay for exposure on them; therefore, I find it helpful to approach social media as a separate tactic. The first step with social is to figure out which platforms make sense for your brand. It is better to do one platform right and well than it is to do more with mediocrity. All social content needs to be planned out to be supportive and complementary to other tactics. (Extra credit for great creative on social media!)

Paid media. Unless your company is grossing tens of millions in revenue each year, you will undoubtedly need to be very mindful of how you can earn rather than pay for media. However, I do find it critical to consider creating campaigns that involve a unified earned, owned and paid effort that has a particular purpose. 

Industry uniqueness. In some way, your organization is unique from its “perceived” competitors. It is imperative to figure out whether that is the leadership, company philosophy, purpose or mission, or something else entirely, so you can create unique ways – thought leadership, events, campaigns, contests, partnerships, grassroots marketing – to educate various stakeholders. Your distinction(s) should harness energy that takes a person from a customer to a rabid fan.