“How much should we budget for marketing and sales?” is a question we are often asked. The answer is, well…it depends.

Marketing Budget

First of all, it is important to establish a preliminary marketing budget based on the type and maturity of your business. If you’re a high-margin business, you can make a case that you want to continue to spend until you begin to see diminishing returns on your investment. Along that line, another important point to consider is the lifetime value of a customer. Establishing appropriate metrics is the first step in knowing when enough is enough.

As a rule of thumb, a new business trying to establish itself, needs to think 5 to 10% of projected gross sales (remember – gross sales will most likely not be that high a number compared to where you would like it to be in 3-5 years). Because of this, we recommend spending at the level of your projected sales – not last year’s actual.

On average, if you’ve been around awhile, we’d recommend lowering this figure to 3 to 5%. If you are an established business, operating for some time now without much marketing, count your blessings…and set aside perhaps 2 to 3% of projected gross sales. While it’s nearly impossible to give you a rule of thumb for marketing due to so many variables, allow me to make a few comments about what is ultimately needed.

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Don’t let technology get in the way of your message.  To avoid doing so, you need to take control of your internet strategy!

Why?  To ensure that new technologies enhance customer experiences – not distract. 

Key to that is making certain the focal point of executing strategy is the customer.  Somewhere in the digital world that vision has become blurred, and while addressing the customer’s needs, wants, attitudes and motivations should be the primary objective, too many companies have become mesmerized by the siren of the latest technological wizardry, and the perceived need to match the competition’s online activity for fear of being left behind. 

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Most of us struggle with trying to avoid marketing fluff.  It’s not easy.  But the benefits are worth the effort.  

I recently read a brochure about a new upscale housing development.  The piece was beautifully designed, had nice graphics, and it visually flowed well.  So what was the problem? What it said.  Or rather, what it didn’t say.  Everything they wrote about their project consisted of dull, worn-out clichés – -”leading edge,” “state of the art,” “innovative,” even that bloated loser “synergistic.”  The copy gave no compelling reason whatsoever as to why I might be interested.  And based on the visuals, it looked to me like there were several.
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