Fort Wayne, IN 46845
A CUSTOMER CENTRIC MARKETING BUDGET!
How do you decide on your marketing budget?
1. Set preliminary budget based on tasks decided upon.
2. Estimate competitors' budget and adjust accordingly.
3. Prepare budget document with rationale of expenses.
4. Use percentage of Sales
The most common method is using percentage of sales. However, what happens if sales go
down? The problem you are trying to correct already has less money to begin with. However, it
is used time and time again. When using that method, I think many look simply at the industry
norm, which is a certain percentage. Take that percentage times your annual revenue. For
Annual sales = $1,000,000
Marketing % = 7%
Annual Exp = $70,000
Monthly Exp = $5,800
After that simply take that number and split it up between, what we call
the Lead Generation trio: Advertising, PR and Referrals. Even that is
probably not that true, because we seldom count referral and PR into our
budget. I typically see a calendar with the major promotions scheduled
out for about 90 to 180 days and the next 30 to 60 days completed with
the smaller promotions. There will be a mix of radio, print, TV, direct
mail, displays, etc., most directed at gaining new customers. In recent
years, there have been better efforts at extending into our existing
customers and tailoring efforts in maintaining them. Further steps have been made towards
specific referrals programs developed. They have proven to be highly successful. I would like to
take you a step further.
In previous conversations, I have alluded to the Duct Tape Marketing method of Know, Like,
Trust, etc and in fact developed my Lean Marketing House with this column being th