Question

Topic: Research/Metrics

How Much To Allocate To A Marketing Budget

Posted by Anonymous on 10/19/2005 at 4:14 PM ET 50 Points
We are a small consulting firm (about 20 staff) and are as usual about to develop next year's marketing budget. What % of revenue is common to allocate to a marketing budget and what is typically included in this budget. Currently our marketing budget covers everything: Web- site, e marketing, printing including letterhead and bus cards and other everyday printing, promo materials and items (pens), folders, brochures, newsletters, seminars, advertising, events. My dilemma is that I can do the bare minimum only and believe based on the firms growth strategy we need to spend more on other types of marketing to support this, such as market research, more targeted advertising or similar to get our name top of mind with existing and potential clients.
To continue reading this question and the solution, sign up ... it's free!
SUBSCRIBE
Or, SIGN IN

RESPONSES

  • Posted by wnelson on 10/19/2005 at 4:57 PM Accepted
    Cat,

    This is a very common question. Here is a links to a similar question for your reading pleasure:

    https://www.marketingprofs.com/ea/qst_question.asp?qstID=10089

    The answer is that planning a marketing budget should have less to do with % of revenue and more to do with what you expect to accomplish with the budget. The best way to do this is to build the budget up from the ground - identifying activities, cost, and expected benefits. Prioritize these so that if you don't get the whole budget you request, then you can reduce the least effective activities. Additionally, fight for the budget by asking for justification of activities other departments request - what are their expected payback versus you marketing activities in terms of profit and revenue.

    I hope this helps.

    Wayde
  • Posted by Chris Blackman on 10/19/2005 at 5:54 PM Accepted
    Cat

    Wayde's spot on.

    Develop your strategy first, then work out the budget to deliver the strategy.

    If it's too big to fit, go back and fine-tune (or perform major surgery on) the strategy until the budget becomes acceptable.

    Just allocating a percentage and finding ways to spend it is a waste of time. The marketing budget becomes self-serving, when it needs to be formed very objectively, and against key deliverables.

    The budget allocation is actually the least of your problems. Having a clear strategy is the most important thing to resolve first. Everything else falls in place around it.

    Hope that helps.

    ChrisB
BACK TO TOP

Post a Comment

Related Discussions

Community Info

Top 25 Experts
(Research/Metrics)