Christmas has said its sayonaras.
And New Year’s is firmly on your view screen.
Now, if you’re like most small business owners, the run to the year’s end is consumed with “goal setting.”
But guess what’s one of the most overlooked aspects of the annual goal setting exercise?
Definition your marketing budget.
Why come? Well, how can you reach your marketing goals if you don’t know how much you’ve got in the kitty to fund the campaigns necessary to achieve those goals?
Who Said We Have a “Marketing Budget???”
Now, as a small business owner, you’re probably also thinking to yourself: “Marketing budget? Which clown said we had a ‘marketing budget’!?”
And I get it. Your “budget” is whatever funds you can afford to “spare.” As if you leave “spare” funds just layin’ around.
The Value + Importance of Outlining a Marketing Budget
There’s a real danger to the “whatever we can spare” approach to budgeting your marketing dollars.
Well, think about how often you’ve been tempted to funnel a fist full of cash into the latest + great marketing tactic to roar onto the scene (AKA, succumbing to the “shiny object syndrome”).
And let’s say you give in to that temptation (we’ve all been there, am I right?). But this impulsive move fails to generate a single dollar of revenue.
In other words, you just flushed your “marketing budget” right down the proverbial crapper. And now you’ve got zero cash to “spare” on the marketing campaigns you carefully planned for the coming year.
How Does a Budget Help?
A defined budget doesn’t mean you have to allocate for every dollar up front. You can, and should, structure your budget to cover expenditures on interesting new tactics. That way you have the option to “experiment.”
But with limited funds earmarked for “experimentation,” you won’t wind up shooting your whole wad on a failed gambit that doesn’t make sense for your business.
How Do You Define a Budget?
Determine what you spend and how to allocate those funds can a be a tricky business. To better piece this puzzle together, here 5 questions that will help you create your 2018 marketing budget…
What Did You Spend Last Year?
When it comes to sussing out this year’s budget, last year’s expenditures are a great place to start. Sure, your cash flow and “spare” capital fluctuate from year to year. But it’s usually reasonable to assume you can afford to spend the same amount you spent last year.
And if, for whatever reason, you can’t dedicate as much of this year’s “budget” to marketing, ask yourself…
How Much Can You Reasonably Afford to Allocate This Year?
Take a hard look at your business’s finances, and be honest with yourself. How much cash can you afford to carve out of your operating capital for marketing?
This figure, whatever it might be, gives you a baseline dollar amount to work with.
What Campaigns Were Successful Last Year?
The success of failure of a marketing campaign hinges on one thing: Return On Investment (ROI). In other words, which marketing efforts generated the largest profits?
Whatever campaign or campaigns achieved the highest ROI is where you should focus the bulk of your marketing budget.
What New Strategies or Tactics Appeal to You?
Likely, there are at least a few new (or new to you) strategies or tactics that you’d like take out for a test drive.
So, make a list. And then do a little pruning. Which options legitimatley make sense for your business? Pare it down to a few strategies or tactics that genuinely peak your interest AND makes sense for your biz.
How Much Can You Allocate to “Experiment” With?
With your “short list” in hand, it’s time to allocate your “baseline budget” funds.
Here’s how to divide things up…
== > Allocate the same amount you spent last year toward your most successful ROI campaigns.
== > Discard whatever you spent on failing or poorly performing tactics.
== > And pledged the remainder toward tactics you’d like to “experiment” with.
Struggling to Define Your 2018 Marketing Budget?
I get it, it’s tough to say what you can really afford to spend in advance. Who knows what’s going to happen in the coming year, right? Business is an up-and-down seesaw. That’s just the nature of this beast. But with at least a baseline dollar amount in mind, you’re faaaaaaaaaar less likely to make blunders. Like throwing away a wad of cash a losing tactic. If you need help sorting this out, swing by my Google+ page. Undoubtedly, we can hammer out an effective budget in no time!