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Are you launching a marketing campaign? Planning your first campaign? A marketing budget is essential to keep you accountable and increase your bottom line. Here’s why.
Chances are that you know someone who has given or received an engagement ring. And you’ve likely heard the slogan “A diamond is forever.” But did you know that before the 1930s, Americans rarely proposed with an engagement ring?
The De Beers company changed an American tradition forever while catapulting itself into the minds of many as a leading provider of a precious stone with four small words. They did it with the power of a creative marketing campaign.
Marketing strategy is essential for any business to stay afloat. However, unless you are a public relations guru, the idea of building a marketing budget can be daunting. But it doesn’t have to be.
Here are five simple steps on how to create a marketing budget you can use to promote and grow your business.
Set Your Goals
Start by setting SMART goals (specific, measurable, achievable, relevant, and time-bound). Set both short-term and long-term goals. This is the place where you want to think big.
Set Marketing Budget Based on Revenue
The U.S. Small Business Administration recommends a marketing budget percentage of about 7% to 8% of revenues on marketing and promotion if your business brings in less than $5 million annually.
This is just a starting base. You should tailor your marketing budget to your current and project revenues, your goals, and your tolerance for risk.
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Do Your Research
Research who your current audience is, and who else you want to reach.
Some good ways to gather data about your target audience are to survey current customers, create focus groups, and use social media analytics to track user interactions.
Market research can help you better understand your target market and your competitors so you can put your budget dollars to work in the most effective marketing platforms.
Allocate Your Funds
With the baseline budget set and the research done, it is time to allocate your budget funds. Now is the time to determine how much money should be spent on things like graphic design, social media ads, and other platforms and strategies.
Measure Results of Your Marketing Strategy
After you have implemented your specific strategies, you will need to measure their effectiveness to make sure you are getting a good return on investment (ROI).
There are several ways to measure your marketing performance, depending on the type of marketing: website and social media analytics, referrals, customer surveys, referrals, and the performance of inbound links.
Always Be Ready to Pivot
Your marketing budget should not be set in stone. As your business grows, your marketing platforms evolve, and your revenue fluxes, so should your marketing budget.
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