Setting a marketing budget is a great way to practice reasonable marketing strategies. But to determine your marketing budget, there are many factors that need to be considered. Marketing involves everything from advertising, branding, public relations, and promotions to website and logo design. So the money spent on each segment determines the entire marketing budget. Marketing is mainly focused on the return of investment (ROI), and the monthly investment in marketing is something that needs to be dedicated and updated based on market trends. So, how much should you spend on marketing each month?
The marketing budget per month depends on many factors. It depends on the kind of business you have, your business goals, objectives, revenue, etc. Unfortunately, there is no one-size-fits-all answer to how much to spend on marketing per month. However, your marketing budget should be a percentage of your revenue. Again, the revenue depends on all the other factors. The monthly expenditure is unknown, hence discussing the factors that determine the monthly marketing budget is more important.
As per industry research, most B2B companies tend to spend 2 to 5% of their revenue on marketing, whereas B2C companies spend 5 to 10%. Knowing your industry and market is the most important factor in determining your monthly marketing budget. To narrow down your target budget, it’s important to research what is common in your industry and how much your competitors are spending.
Establish Specific Objectives
You don’t want to spend money without considering the end result. So it is very important to have a clear marketing goal. Whether you want more people to visit your website or you want to accelerate the branding process, have a goal and rearrange the priorities. For example, last month you managed to have more website traffic than expected, so this month you can focus on something else. Hence, the money can be invested in some other marketing activities.
Cost Tracking and Management
Keep a check on how much you are spending and whether the amount is excessive or not. As you track the marketing budget, it becomes easier to understand how much you can afford and how much you cannot afford. Monitoring the marketing costs helps in refining your efforts and you will be able to create a more accurate budget plan.
Consider the Potential Costs
Social media marketing, online advertising, websites, and newsletters are some of the most important aspects of any business that costs a reasonable amount. Considering these and keeping the money aside for the strategies will help you in the long run. To create a simple video, you may have to hire a camera person, an editor, a recordist, and other equipment. If you already have a content team, allocate money for the process.
As mentioned, setting up a marketing budget is crucial for any business. At the same time, it’s difficult to determine a fixed amount of money. The factors may vary from business to business, but a thorough understanding and research help you give an overview of how much you should spend on your monthly marketing budget.