How to Set and Track Your Marketing Budget

Setting a marketing budget for your business is one of the most critical factors in your success. Although most businesses would love to spread their influence and message as much as possible, time and money limits can keep them from doing so.

Setting a specific budget for your marketing activities has a number of benefits. It will help you steadily grow your business without overtaxing your resources or your staff. It will help you build a consistent marketing plan that will grow your list of prospects. It will also help you keep your spending in check. You are less likely to jump on the next big thing if you have already created your marketing budget and know how much you will be spending on a particular set of activities.

Finding Your Sweet Spot
In order to set a marketing budget that works for your business, you need to spend time crunching the numbers. The general rule of thumb is that your marketing budget should be between 1 and 10 percent of your total sales. However, this can vary depending on several different factors. If you are a brand new business, you should probably spend more in order to get more exposure.

Look at your total sales for last year and then look at what a budget of 1 to 10 percent would look like. Pick a range that makes the most sense to your business and your industry.

Spending Your Budget Wisely
Once you have created a number to work with, it is time to determine where that money will be allocated. There are many different choices. With the rise of web marketing, the choices have become even more diverse.

Traditional marketing and advertising costs can include:
•Print

•Radio/Television

•Direct Mail

•Trade show booths

Web marketing options are:
•Email Marketing

•LinkedIN

•Twitter

•Facebook

•Content Marketing

How you determine where to spend funds over these categories?

It can be helpful to look back to the previous year and determine which channels produced the most results. If you are expanding to incorporate a new channel – like email marketing – look to the best practices of the industry and expected ROI figures in order to determine if it will be a good move for your business.

As you spend your marketing budget, be sure to leave some room for the unexpected. Keep in mind that training for your team and others, hiring experts for specific projects and website improvements should all fall under your marketing budget.

Tracking Your Spending
No matter how you decide to spend your resources, it is important to keep track of your spending. Be very mindful of where your new clients are coming from. If you are using a newsletter or ebook on your website to track leads, be sure to ask how the website visitor found you on the opt in form. Have your sales people and customer service representatives ask clients how they discovered your company.

Then compare your leads to your marketing efforts and see what is giving you the best results. If you find that your email marketing newsletter is bringing in more leads than your print ad, allocate your print budget to marketing your newsletter. By tracking your results and fine tuning your budget as you go along, you can make the next business year a profitable one.