Effective marketing is essential to your business’s growth. But how can you make the most of your marketing budget without compromising your business finances?
Determine short-term and long-term marketing goals and track campaign performance to optimize your marketing strategy. Start by analyzing your current market and using data to identify your best strategies.
Determine Your Goals
Setting marketing goals is the first step in creating an effective marketing strategy. Your goals should be based on data, your current resources, and the projects you’re working on.
The best way to determine your marketing goals is to follow the SMART philosophy: they should be specific, measurable, attainable, relevant, and time-based. For example, a specific goal could be to increase sales by a certain amount by the end of an upcoming period.
For smaller businesses, one recommendation is to allocate 12-20% of revenue to marketing. This percentage can vary based on your industry and business model, but it’s a good place to start.
Another approach is to use a goal-driven marketing strategy, which involves management and marketing agreeing on objectives that align with the overall business plan. G2’s Deirdre O’Donoghue suggests getting the entire team involved in the goal-setting process, and making sure that they’re attainable and relevant to your business. Then you can begin planning your budget.
Create a Marketing Budget
A marketing budget is a plan for how much you intend to spend on different marketing channels and campaigns. It can be a complicated process, with the marketing team discussing their budget goals with leadership and iterating on them. On average, the budget building and approval process takes two months or more.
The marketing budget should be aligned with your business goals and based on the competition you face. It’s best to do competitor analysis and identify what strategies your competition is leveraging. This can help you prioritize what marketing tactics to use to generate leads and grow your business.
When creating your marketing budget, it’s important to consider how you will measure ROI for your marketing efforts. Determine what metrics you will track to measure performance, such as the number of new leads or sales revenue attributed to specific marketing campaigns. This will allow you to compare your actual spending against your marketing budget and make necessary adjustments.
Select Your Marketing Tactics
Once you have your marketing goals and budget nailed down, it’s time to create an effective marketing strategy. To start, you’ll need to define your target audience and establish what makes your products unique. This will help you create a content strategy that resonates with your target audience and demonstrates how your products/services can enrich their lives.
You’ll also need to decide on your marketing channels. For example, if you’re selling power tools to general contractors, it might be wise to advertise on platforms where other contractors see ads. Once you’ve determined your ideal marketing channel, set SMART (specific, measurable, achievable, relevant) marketing goals.
Remember, it’s important to focus your efforts on one or two marketing channels at a time. Otherwise, you may not be able to effectively measure the results of your campaign. Also, don’t forget to update your marketing strategy as your business grows and changes. This will ensure that you always have a roadmap to reach your business goals.
When your team is experimenting with new marketing strategies, it’s important to keep them aligned to your product strategy. This prevents their experimentation from skewing the data and hurting your overall profitability.
It also means that you’ll need to pause any strategies that don’t perform well, and invest more into ROI-positive channels and campaigns. This doesn’t mean that you should stop all experimentation, but instead, that you should hone in on the best methods for your unique business.
For example, Matt used to market his small cleaning company by handing out flyers and chatting with potential clients at local coffee shops. He analyzed how these marketing tactics performed and determined that he was getting better results by focusing his energy on social media and content marketing. He redirected his time and budget toward these efforts, while still allowing for some strategic experimentation. This allowed him to optimize his marketing efforts and improve his revenue. Ultimately, you’ll only achieve an effective marketing strategy on a budget by learning from your data.