Deciding on a marketing budget ain't easy. One must weigh out the risks in line with your business goals and decide what budget is feasible for you and your business.
Let’s face it. A lot of businesses do not understand marketing. On a very basic level, marketing can be used by businesses to help with their visibility and help them grow.
There are a number of cases where spend on marketing is unnecessary, but we won’t get into that. We want to focus on where you feel you need to spend money to make money. You’ve got a bit of cash to use to help grow your business - what should you do?
Cover the Basics
First, you need to cover the basics. Make sure you have a decent website and a good presence on Facebook and Twitter. Updates should go out on a daily, weekly or monthly basis - that all depends on the amount of time you can afford. This all helps with your visibility to customers and clients. The easier it is to find you on the web, the easier it is to buy/book/download from you.
Note: Getting a business phone number is also handy to have just as another channel clients/customers can reach you. 2 minute phone call > 20 minutes reading and replying to a string of email.
Assess Your Goals
Secondly, assess your goals. What direction is your business taking and why do you need to spend money to grow?
Look at the following statements:
- We need more customers/clients
- We need more downloads/installs
- We need more bookings
- We want more people to see the work we did
- We need people to understand we have the best product/service available
If you feel any of the points above were relevant to you, spending a little - not a lot - can help you achieve your goals. There are a lot of online and offline tools that are relatively affordable that can help you to do this.
Where is the Spending Going?
Having finalised your business goals, your next step is deciding where to spend your budget. These two steps are innately linked. Do you need to pay for advertising to get your name out there? Do you need a new logo to help your brand look more professional?
Now, more than ever, options and choice in the likes of advertising, branding and content creation are plentiful. Advertising online through Google's Search and Display Network, Twitter and Facebook allow businesses to target users with high accuracy online. Websites like Fiverr allow users choose from a network of designers (amongst other creators) to pay a nominal fee for create a bespoke logo.
The choice in media spend often relies on size of your business. For example, a small, local barber shop might not have much use for outdoor billboard advertising. But they might benefit from a small, low-budget, targeted Facebook advertising campaign.
Decide on a Budget
Lastly, find out what spend is right your business. Usually, marketing budget is based upon a percentage of your revenue figures but varies with the size of the enterprise. The general guideline is as follows:
Mirco/Small business: 10-15% of revenue
Large business: 5-10% of revenue
For a lot of businesses,especially smaller ones, spending on marketing is a catch-22 situation. “I want to achieve [business goal] but I can’t afford to spend the money I make”.
Taking the risk and putting some money into something simple - like a Facebook advertising campaign or a pop-up shop - could potentially open up a whole new world for your business. You need to be calculated: weigh out the risks in line with your business goals and decide what budget is feasible for you and your business.