Plan Your Marketing Budget Efficiently

It is very important to plan your marketing budget efficiently. You may have a budget to spend on marketing, and you could take the view that you spend it when you must. You get an invoice so you pay it. You simply go your own sweet way and pay the bills when they come in.

NO!!

That is the road to failure. It’s amazing how many people go to an event: a concert, a wedding or even a birthday party and give no thought to the amount of planning that has gone into making that event a success. Things do not happen by themselves. Success take planning – a great deal of it in most cases. Planning your marketing budget takes as much planning as a wedding and the reception. In fact – a great deal more. What seems to have ‘gone smoothly’ actually took a great deal of thought and preparation.

So, when it comes to your marketing budget you must be just as prepared as that wedding or sports event that went like a dream! Here is how to plan your budget efficiently – and it starts with goals.

Marketing has an objective, and just like any other objective it must have goals. So what are your goals? What is your long-term goal? What do you ultimately want to achieve? It might be a specific number of website visits. It could be a target for clicks or conversions if you have an online business. It might even be a specific sales target.

Whatever your goal is, it is essential to have one. Without goals, it would be like throwing darts at a board not knowing what score you have to achieve. So:

Step 1: Define Your Goals

Goals are objectives. Make sure you understand what your objectives are. Without goals, you cannot assess the success of what you are trying to do. Make sure your goals are properly defined. The objective of a spider is not to build a web – it is to catch a fly. The objective of a football team is not to score a touchdown – it’s to win the game.

The first step in understanding how to plan your marketing budget efficiently is to be aware of what that budget is to achieve. Ultimately, it should be to drive sales. Define the term ‘marketing’ and that is what your budget is for. However, that only holds true if your profit per item and your sales target together meet your targeted profit.

If you plan to sell 100 items per week at $10 each and a 20 percent profit margin, then your target will make you just $200 a week. If your budget is to make $5,000/week then you must sell 25,000 items/week or increase your price. That’s a very fundamental introduction to pricing and marketing.

Step 2: Define Your Customers

You will never sell products if you don’t know who your customers are to be. Profile those that your marketing is intended to target. The term many marketers use is ‘buyer personas’ – although this is a trite term. All it means is that you should understand the type of person your market would attract: A night club will attract young people with money to spend. Skin-care products will attract largely women of a certain age that want to keep their skin smooth and soft.

You know your own business so you should know your target customers. You should then be able to consider the type of advertising that appeals to them: young/old, male/female and even the income bands that are likely to be interested in what you have to offer. There are many more examples; you should consider as many as you can.

Step 3: Cost Per Customer

Now you know your goals and your target customers. So what’s next? A major factor is the cost of each customer related to the projected income from each.

This relates to how much money you are prepared to spend to acquire certain types of clients or customers in relation to your prospective income from them. You try not to spend 10 percent of your budget on a client who will give only five percent of your target income.

Some experts find it easy to calculate the cost per prospective customer, sometimes referred to as the Target Acquisition Cost. However, it’s one thing defining a client type, but quite another attracting only those types of customer. It can be profitable to carry out such types of analysis, although it’s better to understand the concept in broad terms than study individual examples.

You will be able to assess the potential percentage profit in terms of what proportion of your budget was spent to attract them. However, if you are too narrow with your judgments, then you can end up spending a lot of money for nothing. So what is the answer? Knowing how to plan your marketing budget efficiently can help you get the most financial return from that budget.

How to Plan Your Marketing Budget Efficiently

First, you must think, analyze and consider:

• Your goals: What do you want to achieve in terms of money spent and return on your investment?

• Your customers: Who are you selling to and what are their expectations? Does your product meet these expectations?

Cost per Customer: How much would each customer cost to acquire? How much should you budget to acquire them – to get sales?

Income per Customer: Does the projected income from these customers warrant the money you will spend to acquire them?

Source: - http://www.sitepronews.com/2017/08/03/plan-your-marketing-budget-efficiently/

In order to plan your marketing budget you should be able to assess the profitability of each potential customer. You should also have an idea how much you will have to spend to acquire each. Not only that, but if you are new to marketing it will give you an excellent grounding in what budgets are for and how to manage them. Planning your marketing budget efficiently is not easy, but it is also very much a matter of common sense.