Many small and medium-sized businesses make the mistake of blindly investing in marketing campaigns without considering the return on investment (ROI). To avoid this problem, it is essential to develop a strategic approach to the marketing budget.
By creating a well-structured budget, you can prioritize your efforts, track your progress, and justify expenses to decision-makers.
In this article, I'll walk you through the process of creating a marketing budget that aligns with your business goals. To do so, you'll need to:
Evaluate your current marketing efforts.
Set clear marketing objectives.
Allocate your budget and core marketing activities with a focus on ongoing optimization.
I hope the following tips help you create a marketing budget that delivers results and maximizes ROI.
Creating a digital marketing budget, a suggested guide.
Evaluate your current marketing efforts
Start by conducting a comprehensive audit of your current marketing efforts to understand where you are starting from. Analyze your marketing spend to identify strengths, weaknesses, opportunities, and threats. Determine which channels have generated the most leads and sales, and identify areas where you can optimize or reevaluate spend.
Here is a checklist of key areas to consider in your marketing audit:
Website Analysis – Evaluate your website’s design, content, user experience, and SEO performance.
Content analysis : review your content strategy , quality, consistency and distribution channels.
Social Media Audit – Evaluate your social media presence , engagement, and follower growth.
Email Marketing Performance – Analyze your email open rates, click rates, and conversion rates.
Paid Advertising Analysis – Evaluate the performance of your paid advertising campaigns , such as Google Ads and social media ads.
To help you with your analysis, consider using tools like Google Analytics, SEMrush, Ahrefs, or other marketing analytics platforms.
Set clear marketing objectives
Once you have a clear starting point, the next step is to set clear and measurable marketing objectives. These objectives must be SMART : specific, measurable, achievable, relevant and time-bound.
Clearly describe what you want to achieve with your marketing efforts, such as:
Increase brand awareness
Generate more leads
Improve customer interaction
Boosting sales
For example , instead of saying “increase website traffic,” set a goal like “increase website traffic by 20% over the next six months.” By defining specific goals, you can better allocate your budget to achieve them.
Allocate marketing budget strategically
Before looking at specific budget allocations, assess your current marketing situation. If you're continuing with a similar strategy, your budget may be in line with previous years. However, if you're starting from scratch or making significant changes, a deeper analysis backed by industry benchmarks is necessary.
Leveraging industry benchmark data.
According to The CMO Survey , by 2024, marketing gambling data hong kong spending will account for an average of 10.2% of total budget and 10.1% of revenue. The specific allocation varies by economic sector, industries, number of employees, and percentage of online sales:
Marketing Budget Benchmarks by Industry : CMO survey data indicates that B2C industries, particularly product-based companies, spend a higher percentage of their revenue on marketing compared to B2B companies. This suggests that B2C companies typically prioritize marketing efforts to reach a broader consumer audience and drive sales.
CMO Survey 2024
Marketing Budget Benchmark Data by Employee Count : CMO Survey data indicates that smaller companies, with fewer than 50 employees, spend a larger percentage of their revenue on marketing compared to larger organizations. As companies grow, their marketing budgets tend to decline as a proportion of overall revenue.
Marketing budget benchmark data by industry : CMO survey data suggests that industries such as consumer packaged goods and media spend a significant portion of their revenue on marketing. In contrast, industries such as mining and construction spend relatively less. These disparities likely reflect factors such as competitive intensity, branding needs, and the nature of the products or services offered.
Marketing Budget Benchmark Data by Percentage of Online Sales – CMO survey data indicates that as online sales increase, so does the percentage of revenue allocated to marketing. Companies with higher online sales tend to invest more in marketing efforts, suggesting a strong correlation between digital commerce and marketing spending.
While industry benchmark data can provide a general guide, it is essential to tailor your budget to your specific goals and circumstances. Don’t forget to look at benchmark data or studies for your priority market or country.
Prioritize high-impact channels
When allocating your budget, it is advisable to prioritize the channels that best align with your goals and potential customers. Therefore, I suggest considering the following:
Marketing Goals : Prioritize channels that directly support your goals.
Audience or Target Audience – Understand where your potential customers spend their time online and allocate that amount accordingly.
Return on Investment (ROI) : Prioritize channels with a proven ROI .
Long-term investments : Invest in long-term strategies like SEO and content marketing, which can generate significant returns over time.
Emerging Trends : Allocate a portion of your budget to experimenting with emerging trends and technologies to stay ahead of the curve.
12 Templates for Making
