If you’re like most marketing managers – pulled in dozens of directions and challenged with satisfying multiple departments’ marketing and sales priorities – it’s safe to assume you’re still putting the final touches on your marketing budget. Every business has a way of determining their budget for internal departments and external efforts, but as a marketing agency, we frequently encounter business professionals who aren’t sure how much they should spend on marketing. Building a successful business is challenging, so in order to inspire continued growth, you’ll need to find effective ways to reach new customers. Our sage advice is to make the investment in marketing to move the needle.
Rule of thumb: Sagefrog has found that new companies (5 years and under) should spend about 10% or more of their revenue on marketing and more established companies should spend 5% or more.
To help you get your marketing budget to a good place, we’ve compiled some useful last-minute tips and reminders to refine your marketing strategy and spend allocations. Read Sagefrog CEO and Co-founder Mark Schmukler’s step-by-step guide to creating a smart marketing budget.
1. Cover the basics
Allocate at least some marketing spend to the tactics that all businesses (and competitors) in your industry put time and money toward branding, website development, content creation and advertising. You’ll also want to maintain a presence on social media and set aside funds for event marketing.
2. Set business goals
Company growth objectives should be supported by strategic marketing initiatives. This means your leadership team is transparent about those goals and will help translate them to marketing spend. A marketing department left with the crumbs of a company’s larger yearly budget will end up with no room to accomplish tasks, no way to stay organized throughout the year and most detrimental of all, will receive no reinforcement from leadership that marketing is a priority. Successful business leaders understand that marketing is not a cost; it’s an investment in business growth.
3. Pick a mode
In your budget planning, clarify the ‘mode’ of your marketing department during each quarter to keep pace with overarching business goals: quick-win mode or long-term growth mode. If you practice account-based marketing, you know all about marketing and sales alignment – and your ‘mode’ is where it comes into play. Both teams should be aware of the chosen mode to know what to expect from each other. If you’re in quick-win mode for example, marketing will know which leads to target and what tactics to use and sales will prepare to sell to a higher volume of leads.
4. Create a buffer
Picture this scenario: your sales department notifies you in Q2 of a surefire opportunity to close warm leads with a simple content marketing campaign that includes a case study, email and free takeaway offer following a consultation. Without buffer funds, you’ll have to justify the unplanned spend to leadership and waste precious time on meetings when you could be closing deals. With buffer funds, however, the internal marketing team will be empowered to set the campaign in motion on their own and the sales team will get their new customers.
5. Look back
A budget usually comes first, but before presenting your proposed plan to leadership, be sure to look at last year’s marketing plan to review how much you spent, what tactics worked, what tactics didn’t work and what initiatives you hope to invest in next. It’s much easier to talk money with leadership when you have concrete justifications at the ready. Use this review period to update and contextualize your department’s processes. Doing so will help solidify your goals, plans and restrictions for the new year and force you to be realistic about the methods you’ll use to grow.
6. Have a rep ready
Don’t have room in the budget for a full event exhibition or marketing campaign? At minimum, allocate for sending a representative from your company to the year’s largest or most important industry events. Ensure that tickets, flights, hotels, meals, business cards and collateral are accounted for. According to the 2018 Marketing Mix Report, tradeshows and events are still among the largest sources for qualified leads, so not attending key events could mean missing out on big opportunities or losing prospects to competitors who planned for attendance.
7. Consider the competition
Are your successful counterparts dominating a popular industry publication with advertisements, producing thought leadership that’s gone viral or creating lengthy informative resources for customers? Investigate their efforts (pro-tip: the 2018 Marketing Mix Report is a great place to start) and make room in the budget to compete in one or more areas, so you can make tactics that work for your competitors, work for you too.
8. Align your plan
Make sure your marketing program actually aligns with your finalized marketing budget if it specifies areas of spend. A budget can allocate money for broad categories like ‘social media’ or specific tactics like ‘LinkedIn paid social promotion campaign,’ but either way, your plan must fit into the budgeted categories. More importantly, sticking to the plan will encourage you to fully analyze the results and perfect the following year’s budget to save money, time and energy.
Want a more detailed peek at the competition to better structure your budget? Available now, the 2018 B2B Marketing Mix Report shares data from surveyed B2B professionals that can ensure your marketing plan is competitive in the year ahead. Discover emerging trends, learn the top tactics that are working well for your competitors and see the budget allocations of B2B companies like yours. Download the free report for more tips to improve your 2018 strategy today.
Are you interested in B2B marketing services? Contact Sagefrog Marketing Group today.