Do you have your marketing budget planned out for next year yet? If not, don’t panic! I’ll walk you through how to create one step by step, and give you a free marketing budget template to help you get started right away.
Download the Ultimate Marketing Budget Template now to follow along!
Why planning your marketing budget is critical to your success
Planning out your marketing budget allows you to strategically allocate spending across programs and campaigns. You can set expectations and keep yourself and your team within your budget limits in one centralized document.
Planning your marketing budget also serves as a basis for tracking the ROI of every investment you make. Connecting your marketing investments and campaign successes to company revenue helps prove the value of your work to C-level executives.
Your budget shouldn’t feel like a ball and chain. Having a budget plan in place allows you to adjust your spending strategy in real time. Why? Because you know exactly where money can be moved from one program to another.
How to create a marketing budget
In the following steps, I’ll walk you through how to create a marketing budget. As you think through your spending plan, just remember that it takes money to make money. Download this free marketing budget template to follow along.
Determine your overall marketing budget
Before you start to allocate money, you need to figure out how much you have to work with. Don’t base your budget on estimates — get your budget limit from your executive team and then plan your marketing spend from there.
Most marketing budgets are based on a certain percent of revenue and depend on the company.
According to the Whole Brain Group, if you’re looking to maintain your current market share, plan on spending about 1 to 2 percent of your company’s top-line revenue on retaining current customers.
If you’re aiming for moderate increases (10 to 15 percent annual growth) then you can plan on spending 3 to 4 percent of top-line revenue on marketing activities around acquiring new prospects as well as retaining customers.
If you have an ambitious growth goal (20 percent or more annual growth) then you should use about 5 percent or more of top-line revenue on an aggressive marketing strategy to attract leads, generate conversions, and drive sales.
Allocate marketing spend by program
Now that you have an overall number for your budget, you can start to allocate money across programs. Let’s look at this program by program.
Content marketing can consist of different activities and responsibilities depending on the structure of your content team and marketing department. You’ll want to consider spending on things like blogs, freelancers, social media management, white papers, and more.
Events can often be one of the most expensive areas of a marketing budget. Carefully plan out and track your spend on trade shows, branding, conferences, travel, and more.
Whether you contract out public relations activities, distribute them across other programs, or have your own in-house team, it’s a good idea to map out exactly what PR activities you can accommodate. Consider adding activities like sponsorships, press events, outreach, and press releases.
Advertising is another expensive part of any marketing budget. But, as Henry Ford said, “Stopping advertising to save money is like stopping your watch to save time.”
Consider what you’ll spend on online advertising, broadcast and print media, in-store marketing, and local advertising. Paid social and paid search can be grouped under advertising or under other programs, like content and online marketing.
Your online marketing spend can change dramatically depending on whether you’re redesigning your website or looking for an SEO overhaul. Keeping up with trends in digital marketing is essential for marketing team, but this program in particular will require more planning because of its erratic spending demands.
Market research can be contracted out, housed in other programs like product marketing, or be provided by in-house talent. If you plan to do market research activities, carefully consider the necessary scope of work for your investment.
Product marketing is an important aspect of your strategy, and closely aligns with your sales positioning. Budget for activities such as product demo videos, case studies, testing groups, and product launches.
Marketing is closely aligned with sales, and your budget should speak to the financial investment your team makes in that relationship. Plan for specific marketing/sales campaigns aimed at driving customer conversions.
There will always be some departmental costs associated with your marketing team. This could include budget for team retreats, training, celebrations, and other expenses. Team cohesion and productivity is key to your marketing success, and deserves the right investment.
Start planning your spend with the Ultimate Marketing Budget Template
In this template, you’ll be able to:
- Plan out spending on program-specific activities;
- Track monthly, quarterly, and annual spend with built in formulas;
- Keep your budget balanced with auto-populating balance fields for activities, programs, and the overall marketing department spend;
- And more!