What is my budget?

Most agree that marketing is essential to growth. However, there’s no simple formula to determine your marketing budget. Today, most spend an average of 2-10% of their net profits; some spend up to 20% of net sales. This may seem like a lot. Or perhaps, you are willing to spend more. To determine a comfortable investment, define your business objectives. Then create a list of potential marketing and advertising options and their price points. From this list, which options have the highest positive impact or return on investment? This revised list can act as your baseline budget. While this list may go up or down, it offers a starting point.

In the end, it has to pay off. The final part of the exercise is assigning value to your return, whether it be short-term revenue or brand recognition, a long-term objective. Our best advice: review your ROI as often as possible so you can make adjustments and evaluate your budget and plan each year.

There’s a lot of information out there. Below are just a few examples of the conventional wisdom out there.

http://www.imageworksstudio.com/client-lounge/articles-tips/setting-a-marketing-advertising-budget.html

http://www.gtms-inc.com/tip_salesandmarketingbudgetbenchmarks.htm

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



Sign up for SJ updates