Respondents estimated that they waste an average of 26% of their budgets on ineffective channels and strategies, while about half of respondents said they misspend at least 20% of their budgets, according to one survey of 1,000 marketers worldwide by Rakuten Marketing. While misspending or wasting funds might be common; however, ensuring that it doesn’t happen is a challenge that many business owners face. From how defining your goals ahead of time can put you ahead of the game to why your niche matters, here’s what you should consider when aiming to build a solid marketing budget in 2022.
Defining your long term goals
Before you officially lay down any concrete numbers regarding your budget plan. Defining your goals from the get-go can make a world of difference in upholding your marketing budget (and overall strategy) in the long run. This includes determining your financial boundaries in relation to your operational costs; as well as your goals regarding the results you’d like to see from your marketing plan. By laying everything out before beginning; you’ll be able to successfully set the foundation for building a budget that aligns with clearly set goals.
The role your niche plays
When it comes to exploring your marketing methods to find the most cost-effective route for your business; your business niche and your target audience can factor in a great deal. For example, those who wish to market beauty products might lean towards marketing methods like influencer or social media marketing in order to reach their targeted demographic. For those in the law sector; however, pay-per-click, or PPC ad campaigns can be particularly beneficial, due to the value of a new client.
It’s important to mention that in a niche like law; terms that belong to the lawyer/attorney keyword family are among the costliest. And targeting such a demographic can present a challenge as doing so isn’t always applicable to every legal specialization. And, with busy lawyers often without the time to execute law firm PPC marketing methods properly (and with improperly managed paid search campaigns often resulting in both wasted money and lost opportunities), hiring a team with expertise on niche-specific PPC campaigns can bring peace of mind to the matter. In turn, you’ll be able to pay for only high intent visits; control your budget, and stay up to date, without having to worry about overspending.
Budget calculation — with a strategy
After determining your overall goals and the role your niche will play in choosing the right marketing channel for your business; deciding exactly how much you should devote to your budget can perhaps be one of the most challenging aspects of creating a solid budget plan. That said, there are different strategies that companies use to develop a marketing budget; with paths including revenue-based, competition-matching, and goal-driven strategies. Though which one you choose to take will be largely up to you and what you feel is best for your situation. While you can determine your marketing budget based on your annual revenue, it’s generally recommended that businesses that are less than five years old should consider spending around 10 to 12 percent on marketing. That said, many may choose to take their research into their competitors, and match their budget for their own plans; while goal-driven planning can allow you to assign a value amount to a specific goal.
Creating a solid budget for your marketing endeavors can be a major challenge; especially when considering just how common it is to misspend or waste money. However, by choosing a calculation strategy, hiring a marketing team that specializes in your niche; and defining your goals upfront, you’re sure to create a comprehensive budget plan in no time.