What's Your Marketing Budget?

So, what is your marketing budget?  Do you have one?  What goes under marketing?  How much should it be?

These are great questions.

How much should your marketing budget be?

There is not a one answer fits all here.  Many different factors need to be considered.  According to the United States Small Business Administration (SBA), the popular way of figuring this is if you are an existing business, use 2% of your most recent annual sales volume. However if you are a new start up, up to 10% of expected sales could be used on marketing in the first year. Other sources say 4-6% of your revenue should go to marketing every year. This figure can vary by industry. Another way to look at this is to try to figure out how much your competition in spending on advertising.

What should go into your marketing budget?

A variety of items go into the marketing budget.  The most commonly thought of item is advertising and promotion.  Here is a list of the most common items that should go into your marketing budget:

  • Publication (Print) Advertising
  • Outdoor Advertising
  • Internet Advertising
  • TV Advertising
  • Radio Advertising
  • Direct Mail (design, printing, list purchase, postage)
  • Marketing Collateral Design
  • Marketing Collateral Printing
  • Email newsletter service
  • Promotional items
  • Trade Shows
  • Attendance at Networking Events
  • Membership in Leads Groups
  • Business meals and entertainment
  • Outside Professional Services (marketing consultant, web designer/developer, etc.)
  • Client gifts and cards
  • Search Engine Optimization
  • Web design/development
  • Branding/re-branding
  • Referral programs
  • Sponsorships
  • PR and Publicity

Before you can write a tactical marketing plan, you need to determine your budget.  If you have tips to share on marketing budgets, please feel free to leave a comment.

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