Marketing is an essential element each business has to undertake to remain successful and relevant in the market. Marketing promotes the products of the business by creating awareness concerning the existence of the business. It is also an opportunity for the business to let their customer know of the goods or services available, where to get them and at what price. However, the business has to get value for the money invested in marking activities. The only sure way to ensure value is making your marketing budget within your means. Several issues must be considered when setting your marketing budget as discussed here.
Focus on the big picture
The first step is realizing that a one–fit–all marketing budget will not work for your business, as each business is unique and with differing needs. Additionally, the fast changing business environment requires a unique approach each time. When coming up with your marketing budget, your focus should not only be the money but should also be on the time spent in planning and execution of the relevant marketing activities. A holistic approach will require you to coin the correct value proposition for the products. The budget should be able to turn the value proposition to actual demand for the products. Therefore, when budgeting consider the marketing activities where it is worth putting your money to generate the desired results.
An objective is a definition of what you want to achieve with your marketing activities, such as Dallas SEO services. The objectives differ with the life cycle stages of your business. The amount of money and other resources that will go into marketing will depend on the objectives to be achieved. Younger business or new products will require a relatively higher expenditure in marketing than already established, well-known products or businesses. The objectives of these two categories also differ. Younger company’s objectives may be to build an awareness of its existence while an existing company only requires reminding its customers about the products. Launching new products will require a heavier expenditure in more than one marketing initiatives to generate a sizeable demand. Existing products will require lesser amount since the customers are already aware of the products and require only being reminded about the products.
Your products complexity
Consider the complexity of your products and how these products will be sold to the customers. The level of complexity and selling means determines the channels through which your product reaches the end customers. The channels determine where you are to vary your budget figures. Complex products require higher training of the sales force or the channel partners. Such products also require printing of more explanatory material to give customers unlike the simple to use products.
Nature of relationships
Business depends on relationships forged with the customers to survive in the market. When developing your marketing budget, you should aim at a long-term relationship with all customers. This reduces the marketing costs in the end as it develops customer loyalty. The relationship should extend beyond the first time purchase. Therefore, your marketing budget has to support the efforts that will inspire and allow customer referrals and spur customers to make repeat purchases. Also, have in mind that it is cheaper to reward your customer’s loyalty than making non-customers to accept your products.
Select and test your strategy
There are many marketing strategies available for your marketing activities. However, the choice of strategy depends on the nature of your products. Only allocate your money to the strategies that rhyme with your products, customers, and your businesses infrastructure. Always test your strategy choice to determine its effectiveness. The evaluation should be done regularly to determine the most effective strategy to make a budgetary allocation.
When setting your marketing budget, the characteristics of your customers should inform the choice of budgetary allocations. Consider aspects such as how your customer buys as a way of determining where their buying process starts. Allocate your resources to the tactics that target the buyer’s personality and ensure the tactic makes the person your customer at the end.
Returns on investment
In the end, the marketing activities must yield favorable revenues and not massive losses. You should ensure that your marketing budget is within utmost 10 percent of your total revenues. The percentage may also differ depending on your marketing goals to be achieved. It may also be dictated by the life cycle stage of your product. However, in all cases always check and select the marketing activity with a high return on Investment.