Creating a marketing budget for your small business is essential for achieving your marketing goals. Ready to create a budget for your small business? Here are the steps to create a marketing budget for your small business that will work for you.
Calculate your expected revenue for the upcoming year. Consider historical data, market trends, and growth projections. Next, identify your fixed and variable expenses, including rent, utilities, salaries, and other operational costs. If you’re a new company, this will likely be an educated guess. That’s OK; just start with some idea of anticipated revenue and expenses; you can always adjust these later as you have a more solid idea of incoming and outgoing monies.
We get it: some of the tasks we’ve listed above may seem challenging if you really have no idea, such as a startup company. Relax! Budgets aren’t inflexible and should adjust over time. Checking out your competitors can help give you a place to start. Research industry benchmarks and competitors’ marketing spending to see how your budget compares. This can help you determine if your budget is too high or too low relative to your industry standards.
The best way to measure results is to look at spend vs. results. Break down the budget allocation for each marketing channel to best achieve this. Consider expenses such as advertising costs, marketing software and tools, content creation, graphic design, and any small business marketing consultant or freelancer fees if you’re outsourcing certain tasks.
As we mentioned before, your marketing budget is not set in stone. Regularly evaluating your marketing performance and adjusting your marketing budget for your small business is important. If a particular channel or campaign is delivering strong results, consider allocating more budget to it. On the other hand, if a channel is underperforming, reallocate funds to more effective strategies. Especially if you’re a startup, evaluating throughout the year makes sense. Being aware of your spending and the results you’re getting is important, so don’t be afraid to adjust as needed if you have enough data to support your actions.
No one plans for a recession, a major client leaving, a pandemic, or whatever else life throws your way. Leave some room in your budget for unexpected expenses or opportunities that may arise throughout the year. Having a contingency fund can help you adapt to changes in the market or unexpected marketing needs.
Creating a marketing budget is a dynamic process. As your business grows and market conditions change, your budget will need to adapt to stay effective. Regularly review and adjust your budget to ensure you’re making the most of your marketing dollars. If you feel overwhelmed by establishing an initial budget, working with a company like Strategic Marketing Services can help. Whether you do it yourself or work with someone to help create a marketing budget for your small business, the time to get started is now!
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