5 Steps to Creating Marketing Budget for Your Business

5 Steps to Creating Marketing Budget for Your Business

Can a company live without a marketing budget? Yes, it is possible. But not for long if you are a small company, and a little longer if you are a large company.


What is this budget for? To understand how much money you spend on attracting and retaining a client, how much it costs you to contact one client, how much profit this client brings and what is the difference between costs and revenues. Ideally, the marketing budget describes it all. Yes, not all marketing and advertising costs are explained in terms of cost-effectiveness in attracting a client. But the fact that everything that happens obeys this goal is beyond doubt.So, you are the person making the marketing budget. And we will help identify key and sore points, as well as do everything right in practice.


Assess the Financial Capabilities of the Company


Before making a forecast of the advertising budget, it is necessary to evaluate the maximum investment opportunities of the company. For this:

    • Estimate the level of income in each month throughout the year. The assessment is similar to a “rough” sales forecast based on the available statistics. In other words, based on the company's historical sales data, plan how much sales the company will bring next month each month.

Important: do not exaggerate, try to evaluate the most reliable, but rather the minimum level of income. For example, if the sales volume varies from $20,000 to $50,000, it is better to take the minimum value of $20,000 for budget planning.

    • The next step is to determine the expenses in each month of the year. This may be the cost of buying materials, paying employees, renting space, tax payments, etc.

The result of the first two actions is to obtain an indicative amount of the company's future profit, which can be invested in future growth.

    • The last point is to identify all the priority areas of your business for the next year, in other words, key sources of growth and business opportunities.

However, remember that marketing is only one of the directions for future investments. It may turn out that it is more important to upgrade the equipment at the moment or to direct all resources to the development of new technologies, or to staff training.


Start by Defining Targets


Make sure you understand what your goals are. Without goals, you cannot appreciate what you are trying to do. The result is the foundation of any budget.

    • What do you want to achieve in terms of money spent?
    • Will the projected revenue be sufficient to cover the company's current expenses?
    • What level of return on marketing investments do you plan to reach by year?

As a simple example, you can use common goals for most companies:

  • The increase in website traffic measured by unique visitors per month
  • Increase targeted traffic from geographic coverage
  • Affiliate marketing leads increase with the Leads Market.

Choose the Most Reasonable Focus Point Based on Your Metrics


Below we provide a list of the most effective areas where you can direct your marketing efforts.


✓Search engine optimization (SEO) is an ongoing process that is vital for any business that wants to reach customers in the organic (unpaid) search of Google and other search engines. However, remember that firstly, high-quality SEO cannot exist without the same quality content, and you will see the first result in at least three to four months, secondly.


✓Social Media Marketing. One of the best things about social media marketing is that you can use them for free unless you run ads. Time spent will be the biggest investment you can make. Marketing actions include the creation of social profiles, the publication of new content, the creation of an audience and regular interaction with it. It looks quite simple, but for a real result, you still need an intelligent copywriter, graphic designer, as well as a separate strategy.


✓Contextual advertising. Both search engines and social networks offer PPC (pay per click) advertising options. PPC allows you to reach new customers by paying for the space on search engine results pages, in social media feeds, and on sites and applications that are part of their advertising system.


✓Content marketing. This is a key point that you will always need, regardless of whether you focus on SEO or on social networks. All these features are in one bundle, and the quality of the content is crucial here.


✓Email marketing is an unmistakable way to reach current and potential customers who share their email address. A well-built personalized chain of letters makes it possible to steeply and efficiently lead a customer through a sales funnel. And yes, content solves everything here as well.


Determine How Much Money to Provide for the Budget


At the same time, it is possible to build on a specific task, determining exactly what the company wants to achieve. To do this, come from the goal of the company, as well as assessing the quantity and quality of potential customers who need to be attracted to achieve these goals.


Most often, the budget is formed as a percentage of the company's turnover. This percentage includes spending on key marketing campaigns over a given period. Usually, media is the most expensive part of the budget.


Provide a Budget Reserve for Performance Analysis


No marketing strategy makes sense if you don’t analyze your results. In practice, it’s called draining the budget down the drain. Therefore, your document regulating the marketing budget must necessarily contain the cost of analyzing your marketing efforts. Even if you plan to do it yourself, without planning to rent an analyst in the office or on a freelance, this item should still be provided as a backup. Since we repeat again, any action loses its meaning without proper analysis of the results.


Conclusion - Your Budget Should Be Balanced


Mistakes and distortions in the distribution of funds, even with a properly planned budget, happen very, very often. In addition, sometimes the budget is made from the point of view of the leader and the marketer, when the channels that they choose, and not the target audience, are taken into account. Thus, speaking of a harmonious budget, this should be an optimal budget in terms of the amount developed based on the conditions of the competitive environment and the chosen marketing strategy.


About the Author


luke loftinLuke is a writer and editor based out of Los Angeles. He specializes in finance, as well as health and wellness. In his free time, he enjoys watching Astros baseball. You can find him on LinkedIn.


1 Star2 Stars3 Stars4 Stars5 Stars (2 votes, average: 5.00 out of 5)

Leave a Reply

Your email address will not be published. Required fields are marked *

Top Rated Articles

How your company can adapt to the Digital Revolution

Over the last couple of years, technological innovation has brought about a rapid change in the customer service landsca


Will Marketing Automation Help Your Business Grow?

Marketing automation software can benefit your business in a number of ways. It is a great way to increase traffic, enco


How CRM Can Maximize Customer Lifetime Value (CLV)

"Keep your customers always on the frontline," this is a key philosophy to running a successful business. Customers are


Recently Viewed

How I changed my Facebook Business Page Name

I started a Facebook page for my business many years ago. I had spent thousands of dollars running ad campaigns and gain


6 Sydney Business Meetup Groups you Should be a Part Of

Being a member of a meetup group in Sydney is a great way of networking with people from your field. You can find new


Why Creating a Roadmap is Crucial to Business Success

When starting up your own business, one of the best pieces of advice I can give you is to create a business plan. Most b

  • Over the past 6 months the incredible team at MMP have supported us to shift our attitude towards our business & month on month our revenue is increasing to the point we will be able to employ additional staff to support our business goals long into the future. Do not regret our decision one single bit!

    • Emma Reece

  • Working with my coach has enabled me to see the areas where my business is failing. This was pretty confronting to me to be honest. MMP has the tools to improve these areas and the guidance on how to implement them.

    • Sharon Robinson

  • I have been working with Max My Profit for approx 3 years now, and over that time I have learnt a lot of things about not only what it takes to run a business, but I have also learnt things about myself. I don't believe i'd be the person or have the business I have today if it wasn't for Max My Profit and our Business Excelerator. Great team to work with if you want to take your business serious!

    • Ben Choy

  • As a new client for Max My Profit (MMP) it has taken no time at all to realise the benefits of business coaching. Despite many years of senior management experience starting a new business requires best practice systems and processes built on a solid platform of detailed planning. I look forward to the benefits of adopting the formula being shared by MMP.

    • Campbell MacLeod

  • Max My Profit Are truly awesome at what they do. They have helped me over the past 12 months to get off the tools in my business and start working on my business. I am looking forward to 2019 with enthusiasm not concern. Thanks so much.

    • Aaron Kemp

  • If you are committed to Growth the Max My Profit Team has the tools and expertise to excelerate all areas of your life. They Care, They Listen, They Understand You as an Individual first then they focus on Your business. Thank you Max My Profit my rating is a 6/5 - Kindest Regards The Mr Handyfix Team

    • Catherine Kavadas

  • The team at Max My Profit are an absolute pleasure to deal with. I love working with a team who is on top of what they are doing and have a clear view of what they are working on with you and helping ensure you get to the end goal.

    • Lauren Watts

  • I have been working with MaxMyProfit over the years and what they do for SME's in growing their business is fantastic. Also due to there knowledge and their supporting material for companies across the 5 lifestyle stages and assisting them through this process day in day out is extremely comforting as a small business owner and have referred them many businesses over the years.

    • Steve Laingy

  • Working with a business coach from MaxMyProfit has been one of the best things I have done for my business. I had several other coaches before MaxMyProfit but these guys are a step above the others. I have seen a significant increase in sales, now have a business that can run itself and the coaching program has paid for itself many times over.

    • Matthew Kitchin

  • Much more than just business coaches. There is an absolute treasure chest of business knowledge in their members site.

    • Iain Campbell

  • Max My Profit are unique as they really partner with you to develop and implement a plan that will drive success for the business. I was hesitant to proceed as previous business coaches tell you what to do and rely on you to implement.

    • Michael de Haan

  • I attended one of Max My Profits introductory events in Melbourne. Having been an accountant for almost 30 years, I was somewhat sceptical. Boy was I wrong. I not only enjoyed the presentation, but I gleaned so much from just that session.

    • Daniel Odd

  • These guys are an absolute wealth of knowledge for Small Business. The programme and support networks they have set up ensure learn more every day and can take your business from good to great. Thanks so much.

    • John Butler