If you haven’t started the process of reviewing this last year’s ROI and defining company goals for the next year, you soon will be. That process typically involves budget discussions and often the marketing budget is up for debate. Additionally, most marketing contracts are up for renewal toward the end of the year. Business owners and marketing professionals wrestle over whether or not to leave the marketing budget the same, increase it or even cut it back. To guide that discussion, we’ve identified the following important considerations to help you make the most of your advertising investment in the coming year.
Budget is Growing—Plan
If your budget is increasing, that’s a great problem to have! Most businesses use a percentage of the previous year’s sales to determine their budget, so if budget is up, it’s typically because a successful year provided more profit to reinvest in the next year. Congratulations! With extra budget, your first look should be toward what is currently working…are you dominating that marketing channel or is there room for growth? It’s important to look to what’s working, to consider your current advertising BEFORE adding anything new to the mix. Resist with conviction the urge to “test” a lot of different advertising mediums; doing a little here, a little there, and a little more over there. You run the risk of inadequately using lots of different advertising choices rather than carefully and strategically dominating the few you can afford. The last thing you want to do with your advertising budget is waste it, even if it is plentiful. When, after careful consideration, you have room to add new advertising mediums to the mix, select new ones based on their ability to deliver the right audience and your ability to dominate that medium.
Budget is Static—Set Goals
If your budget stays the same, first assess why. Just because there hasn’t been a budget increase isn’t necessarily a bad thing. Was it because of flat sales over the previous year? Ask yourself how your industry performed in the market overall. If others lost revenue, then staying the same as last year is, for you, a win. If you just came off your best year ever, then perhaps maintaining that level of revenue is, again, a win. Were there significant changes in your business that affected your marketing success? i.e. a key employee leaving, a new competitor in the market, the loss of a key product line, etc. Whatever the case, setting specific business growth goals will help guide your decision-making for next year. Look at where you invested this last year, making sure you invested enough in each area to get results. Don’t fall victim to the “spray-and-pray” method of advertising. Focus your choices on your goals, and support those choices with enough money to dominate that audience. Make sure your marketing partner knows what your goals are and is developing campaign strategies that specifically support those goals.
Budget is Decreasing—Focus
For a shrinking budget, you must streamline your marketing methods. First, we suggest again asking yourself lots of critical questions. Try to pinpoint exactly why your budget is decreasing with an eye toward what you can control. Set a few specific goals for the next year, then choose an advertising venue based on that goal. Focus on making that your main marketing outlet. If you spread your budget too thin you will get equally as thin results, and your marketing message will be watered down. Smaller budgets can absolutely bring effective results. Success comes by focusing on one or two strategically selected marketing venues and relentlessly targeting those consumers. Then stay focused and don’t quit.
Additionally, get creative about finding low or no-cost methods of promoting your business and commit to doing them regularly. You may need to refocus your energies on doing the things you used to do, but have stopped doing…things like networking, social media, sampling, presentations, etc. Advertising with a small budget may not be easy, but it CAN be done and you CAN successfully push through to growth. It takes focus and commitment.
Careful Planning for Your Marketing
Advertising and marketing all require resources: time, manpower, technology, marketing partners and finances. When possible, we also suggest you maintain an excess budget to allot for any marketing emergencies. After all, while planning for an entire year is vital to any business, the economy is a fickle – either friend or foe – at any given time, and unforeseen events can affect your business at any time. Marketing is the critical driving force that overcomes those challenges by connecting your company to your customers, regardless of your budget. To help guide your planning for the new year, we invite you to download our e-book below, "Annual Planning Made Simple."