Apart from labour (which can account for as much as 70% of a company’s expenses), every business owner has to deal with another expensive thing – marketing. Without a solid marketing plan in place, all your efforts to provide quality products and top-notch customer service will turn into waste.
On average, marketing costs a business $3,000-$20,000 per month. That is a huge expense especially if you are just a small entrepreneur and still working your way to a stable position in the market.
But there’s no need to frown.
The good news is even if you have a very strict budget, you can still promote your business effectively.
Begin by Creating a Detailed Marketing Strategy
Behind every successful marketing is a well-planned strategy. As an entrepreneur you should be able to answer the what’s, whys and how’s of your business.
For instance, what are your marketing goals? Do you aim to find a new market or simply retain your customer base? Are you promoting a new product or an existing one?
Basically, your budget will change depending on what you are trying to achieve. If you aim to find new prospects but you only want to spend for some banners, posters, and business cards, don’t expect to double your customer base in one snap!
Determine Your Budget
Once you’ve polished your marketing strategy, creating a budget gets so much easier. Unfortunately, it is difficult to work with a very small budget.
Good thing for entrepreneurs, there are small business financing options, such as personal loans for good credit to fund the costs of their operational expenses, including marketing.
But How Much, Exactly, Do You Spend For It?
When calculating your marketing budget, the essential factors that you should consider are your total revenue and company size. If you’re a small business, the U.S. Small Business Administration recommends allocating 7-8% of your gross revenue to marketing and if you’re an established business, 6-12%.
While it’s totally up to you how much you want to spend, these figures are a great starting point. Knowing these recommendations also gives you some guidance on whether you are overspending or under-spending.
Allocate Your Budget
After setting the price, the next step is to break down the budget into specific courses of actions or marketing activities. Again, it all depends on your marketing strategy. For example, if your strategy involves promoting on social media, updating your website, and working with influencers, you must determine how much money goes into each one.
Budget allocation requires a lot of research because each marketing initiative has a unique corresponding cost. Don’t think that you can allocate the same amount for your marketing tactics. It will greatly depend on your industry, business goals, and direct competitors.
Also, take note that in addition to these, your budget should also cover the expenses for the legwork such as the research, testing, creative production, communications, and results tracking. There are marketing budget templates that you can download for free (like these ones).
Align Your Team To Your Goals
Ensure that your marketing team understands your marketing plan and how they should take part in it. For example someone has to track the progress , and someone has to oversee the implementation. Make sure everyone knows who is responsible for both of these tasks.
You must also assign one or more people to each specific marketing tactic. By getting your team on board and working together, it will be easier for you to manage your marketing.
Consider Inexpensive Marketing Approaches
Thankfully, there are many marketing tactics that should not cost you a fortune. In addition to your main paid marketing strategies, incorporating a few of these proven cheaper initiatives should help you reach more people without breaking the bank.
- Social media competitions – these can help you raise brand awareness and even generate leads. Prizes can range from discounts or freebies, or free products.
- Community events – organising local events can help you gain exposure in your community.
- SEO – this is a complex process but you can begin with ensuring that you have updated, useful content on your website. Uploading blog posts regularly is an inexpensive way to boost your website in SERPs.
- Social media marketing – with billions of people on social media platforms, getting noticed is possible with the right marketing approaches. You can create a business page on Facebook however, and you definitely should.
Marketing is a critical component of your business venture. Every company, big or small, needs to constantly market their products or services in order to stay on top of the competition and achieve their revenue goals.
But in order to make your marketing dreams a reality, you should first work on your budget. In doing so, start with creating a detailed marketing plan that aligns to your business goals. Next, you must determine how much you should spend on it and properly allocate your money to each aspect of your marketing plan, including things like research and tracking.
Also, don’t forget to incorporate inexpensive marketing tools that can bolster your advertising efforts without wrecking your budget.