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Backwards Marketing Budgeting
Determining and Optimizing Your Marketing Budget Starts at the End.
When putting together your marketing budget, starting with a percentage of revenue, or building complicated SLAs or distributing detailed RFPs are all inefficient ways of determining your marketing budget and finding the perfect marketing firm for the job.
Let’s work backward.
Start with a final goal. This goal should be one that impacts you’re business greatly in some way. For example, let’s say that 10 new customers in a 12 month period will both generate a significant growth in your business but not overwhelm your resources.
Let’s also say that 10 new customers are worth $10,000 per year (every year) in profit for your business.
When setting your marketing budget, determine what reaching that goal is worth. In other words, what are you willing to invest (or gamble) to achieve that goal? That’s your marketing budget.
Sound easy? It is. The hard part is discovering the firm that can confidently achieve that objective for a price that will generate a positive return on that marketing investment and will fit snugly into your budget.
Here are a few things to look for in the perfect firm for you:
Location, Location, Location
The three rules of real estate are also key in determining the right firm for your business. Outsourcing your marketing activities can pay off huge dividends in quality, integration and speed, but it’s a gamble if you don’t ever meet the team you’re counting on in person.
Consider also, the “home court advantage” of a local firm. If the bulk of your marketing is regional, a local firm can leverage its local experience and contacts to better achieve your marketing objectives.
Access to Management
It’s nice to work with the combined resources of a large firm when everything’s progressing smoothly. It’s quite another when there are barriers to access the senior management when the wheels start falling off and you just need to get the job done.
Call the office. If a machine answers during business hours or if the people who are in charge are never available, go elsewhere. You may have saved yourself a world of pain in the future.
The "Right Price"
It’s very important when outsourcing your marketing to find a firm that will work with you and your budget. Ask about their policies on “Change Orders”, “Scope Creep”, and engagement options. You’ll quickly find out if your businesses are in alignment or if they’ll nickel and dime you to their last breath.
Ultimately, when determining your marketing budget, it’s best to work backwards, but that’s the easy part. Once you've got your budget, it’s time to start shopping. That’s when it can get a little tricky.
Looking to skip the tricky stuff? Contact JDM for a FREE marketing consultation. Let us help you find the right firm for your business and the right mix of marketing activities to achieve your goals.
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