How Much Should You Spend on Marketing?

You are a business professional and you want to make sure your business is growing. You know marketing is so important, and you want to invest in some good marketing, but you’re afraid of the $$$ that may be involved. Maybe you think you can’t afford marketing, and so you’re sitting back on the sidelines not getting anything done. Well, you definitely don’t want to do that. This blog
post is geared to help you figure out how much you should spend on marketing, without breaking your bank, so your business leads can start coming in.

DIY – Marketing Without a Budget

I’ll tell you how to calculate a good marketing budget, based on your financial situation, in a moment. First though, let me point out that you can do your own marketing at no financial cost. There are plenty of marketing tools that are at your disposal, and only cost a whopping $0 per month. If you choose to take the DIY route, you need to identify which tools are best for your situation. Here are a few that may work for you:

• FREE Websites – You can always build your own website for free. Some very popular website platforms are WordPress, Blogger, Wix and Weebly. Just beware, if you go with a free website, you most likely face some limitations to what you can do. Here is an article about some of the pros and cons for each of these website platforms. It’s a good read if you want to look into it a bit more.
• FREE Media – In the past, you had to go to the newspaper, radio or television studios to get your message out to the masses. Nowadays, things are different. You can simply create killer content and share it through social media channels. Here are some popular ones that may, or may not, be a good fit for you:
  • Facebook – Of course, I can’t talk about social media without including Facebook as an option. Facebook isn’t for everyone, but it works for many. Ask yourself if you can visually portray your business through Facebook. Facebook users like pictures, VERY short stories [like no more than one or two lines of text, on average] and anything else that’s visually engaging. If this fits with your business, than great! Also, believe it or not, there are a TON of Baby Boomers on Facebook. If that’s the target age group for your business, than perfect! Check out these stats about Baby Boomers on social media.
  • YouTube – Yup… I’ve got this classified as “Social Media.” Not only is YouTube known for being the second largest search engine in the world, but it is also a social site. What makes it social? It’s social because you don’t need a developer to publish content. Any average person with a video and a YouTube account can publish content on YouTube. Also, to be classified as “social” it has to allow for two-way communication between the person publishing the content, and the viewers. Sure enough, with YouTube, you publish content and people leave comments. Ta-da! It’s social media, it’s free and it might be a perfect fit for you.
  • Twitter – This is another popular social media platform that doesn’t cost a penny. Again, it’s not for everyone, but it may be for you. Is it important for you to network with professionals in a certain industry? Are you trying to build a name for yourself and get noticed? I’ll bet you are. Consider using Twitter.

I just talked about websites and social media. There are certainly other aspects of marketing, but this gets the general point across… you can do your own marketing with a marketing budget of $0 per month. If you can do it yourself, than great! If not, check out this next option:

Hire A Marketing Professional

Okay, so maybe you don’t have the time or energy to figure out how to properly create a website or social media account the right way. Nor do you have the interest in learning the ins and outs and the best practices. And maybe you DEFINITELY don’t have the time to manage it. That’s okay. You can simply hire someone who already knows what to do and has the right skill set [I’ll volunteer to let you hire me. ]. Now for the big question…

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How Do You Identify Your Marketing Budget?

Glad you asked. Over the last several years, I’ve learned some good percentage benchmarks to live by. First, you’re a newer business and you’re trying to actively push your marketing forward, then you want to spend about 12% of your gross income. What are your sales, per month, on average? Take 12% of that, and plug it into your marketing budget. Now, you don’t have to spend that percentage. You may want to take a more aggressive approach. Some businesses go up to 20%, or if it’s a really competitive market and industry, they may even go up to something like 50%! I’m not suggesting you spend that amount, but 12% is pretty common. If you aren’t actively pushing your marketing, and you just want a low budget to keep your name out there, but not to bring in a whole lot more business, then you will want to cut down to maybe a 5% budget. I’ll tell you that personally, for my marketing business, I spend 15% on marketing. Not sure if that helps you, but take it or leave it.

These stats are based on my research and experience over the last several years. Whenever I read up on this, the statistics seem to remain pretty consistent. However, don’t just look at what I have to say. Here are some more articles you can read on the topic. They all have slightly different angles.

• How Much Should Companies Budget for Marketing?
• How Much Should You Budget for Marketing in 2016?
• How to Determine the Perfect Marketing Budget for Your Company This is my favorite. She gives some great insight and even breaks out tips for how much to spend on internet marketing.

Nothing is Free

Yeah, you’ve heard it before. Nothing is free. Even if you decide to take the DIY approach, you’re still going to have to invest plenty of time researching what you need to do, and figuring out the best practices. If you do something the wrong way, your entire marketing effort could backfire on you, and that certainly isn’t free. If you’re going to do it correctly, it will cost you time and energy. If that’s fine with you, then great! If not, you can hire someone. If you hire someone, it will cost you money. But the cost is scaled to your gross income, at a percentage you select as being reasonable for you. At least you have the option between DIY and hiring someone, and you can even try to find a middle ground.

I’ll shut up and let you ponder this blog post. However, if you have a simple question, just give me a phone call. If you’re interested in having me work with you on your marketing, click the image below to get started!