How to Create a Marketing Budget (and Why You Want One)

A marketing budget is a plan for how much money you will spend on marketing activities in a given period of time. It is an essential tool for any business that wants to be successful, as it helps you allocate your resources effectively and track your progress. Here are the steps on how to create a marketing budget:

Set your marketing goals. What do you want to achieve with your marketing? Do you want to increase brand awareness, generate leads, or drive sales? Having clear business goals is helpful in general, but essential when discussing marketing. Once you know your goals, you can start to develop a budget that will help you achieve them.

Research your target audience. Who are you trying to reach with your marketing? What are their interests, needs, and pain points? People buy solutions to problems far more quickly than general benefits. Focus on trying to view things from a prospective clients point of view, what are their hurdles and where do they struggle, this dovetails nicely into sales as well. Once you understand your target audience, you can tailor your marketing messages and channels accordingly.

Identify your marketing channels. There are many different marketing channels available, such as search engine optimization (SEO), pay-per-click (PPC) advertising, social media marketing, email marketing, and content marketing. Each channel has its own strengths and weaknesses, so you need to choose the ones that are right for your business and your target audience. Social media marketing excels when you are selling something that can be an impulse buy for most customers, SEO and search engine ads are better if you sell something more specific that people will be willing to search for themselves. Then there are other considerations, if you are more interested in brand awareness than an immediate sale, you may want to focus on things like social media marketing, mailing lists, and collaborative efforts with others.

Set a budget. Once you have estimated the costs of each marketing channel, you can set a budget for your overall marketing efforts. For some industries and regions, search keywords aren’t very competitive, and thus are much cheaper than say a lawyer in NYC’s preferred keywords. Google’s Keyword Planner is an excellent research tool if you are going to be doing any keyword related marketing, such as search engine ads and SEO. Be sure to leave some wiggle room in your budget, as there may be unexpected expenses.

Track your results. Once you have implemented your marketing plan, it is important to track your results and make adjustments as needed. This will help you ensure that your marketing budget is being used effectively and that you are achieving your goals. One way to do this is by using Google Analytics to track traffic and conversions, or any other metric they offer. Another useful tool here is the Google Search Console, which allows you to see the way Google views your site, it can suggest problems that may require some technical SEO to deal with for example, allowing you to track the resolution of the problem.

Here are some reasons why you want to create a marketing budget:

It helps you allocate your resources effectively. A marketing budget ensures that you are not overspending on any one channel and that you are investing in the channels that are most likely to reach your target audience and achieve your goals. Just because you know someone that had excellent result paying a firm for an ad campaign doesn’t mean that same firm will provide the same results in a different industry and different channel. I’d recommend that most people hire an agency for bigger marketing pushes, but use that opportunity to educate yourself via the agency you chose, any good agency will be willing to offer some free knowledge to their paying customers. This approach allows you to experience the most of the benefits of outsourcing all of your marketing needs, while being more cost effective.

It helps you track your progress. A marketing budget allows you to track your spending and results over time, so you can see what is working and what is not. This information can be used to make adjustments to your budget and marketing plan as needed. I shouldn’t have to say it, but data should inform all business decisions, and marketing is no exception. Comparing your marketing spending to revenue over time allows you to track performance over time and more easily isolate the benefits of a given campaign. You may find that a technical SEO touch up every few months is more efficient than paying for it monthly. It may be difficult to identify when you are getting value from a given service if you are unable to quantify the benefits.

It helps you justify your spending to stakeholders. A marketing budget provides a clear and concise explanation of how you are spending your money. This can be helpful when you are trying to justify your spending to stakeholders, such as investors or even a spouse. There is a reason why budgeting is ubiquitous in business, it is simply essential.

If you are a small business owner, Lux Marketing Solutions LLC can help you create a marketing budget that is right for your business. We offer a variety of services, including SEO, PPC ad campaign, and web design. Contact us today to learn more about how we can help you grow your business with a free consultation.

Here are some final tips for creating a marketing budget:

Be realistic about your budget. It is better to start with a small budget and grow it over time than to set unrealistic expectations and end up overspending.

Be flexible. Your marketing budget may need to be adjusted as your business grows or your goals change.

Be patient. It takes time to see results from marketing efforts. Don’t expect to see a return on your investment overnight.

By following these tips, you can create a marketing budget that will help you achieve your business goals.