Allocate Your Marketing Budget: Key Factors to Consider
When it comes to allocating your marketing budget, there are a few key factors to consider. The first is your overall business goals. What are you looking to achieve with your digital marketing efforts? Whether you’re hoping to increase brand awareness, drive traffic to your website, or generate leads, it’s important to have a clear goal in mind. This will help you determine how much to spend on each marketing activity.
The next factor to consider is your target audience. Who are you trying to reach with your marketing campaigns? Once you know who your target audience is, you can better allocate your resources to reach them effectively.
Once you’ve considered your business goals and target audience, it’s time to start planning your marketing budget. As a general rule of thumb, you should allocate around 3-5% of your overall budget to marketing efforts. However, this may vary depending on your industry and the competitive landscape. If you’re in a highly competitive industry such as the kitchen and bath remodeling industry, you may need to spend more on marketing to stay ahead of the curve. Conversely, if you’re in a less competitive industry, you may be able to get by with a smaller marketing budget.
What Is The Definition of A Marketing Budget?
A marketing budget is a document that specifies how much money your company plans to devote to marketing during a given time period, such as a year, quarter, or month. When budgeting for marketing, consider not just the monetary costs of advertising your company, such as paid advertisements, staffing expenses, marketing tools, website maintenance expenses, and so on.
Why Is It Necessary to Have A Marketing Budget for My Kitchen & Bath Business?
Wondering why you’ll need a marketing budget for your remodeling company in 2022? Here are five of the most common reasons.
1. It helps you keep track of your finances
If you’re building a marketing plan, you’ll need money to help you stay on track financially. You’ll be able to keep track of how much you spend on each technique, whether you’re overspending, and whether you can spend more when you create a marketing budget. If you fail to create a marketing budget, you’ll probably end up exceeding it, which might lead to your company’s failure.
2. It helps you direct your money to the best places
A marketing budget plan will assist you in properly allocating your marketing investment. You can more precisely determine how much you’ll spend once you know how much you can spend. A budget analysis allows you to figure out which tactics are efficient with your cash and whether digital marketing company packages fit within your price range.
3. It helps you set benchmarks and goals
Having a clear budget is useful in establishing realistic targets and objectives that will help your company advance. You may establish more reasonable expectations for various marketing channels based on your budget, and you can better understand the revenue required to make your marketing efforts worthwhile.
4. It allows you to make longer-term plans.
Planning ahead of time for your marketing budget in 2022 allows you to have greater certainty and enables you to create a longer-term strategy for your marketing. You won’t have to fight for additional budget throughout the year or stop campaigns due to money constraints, because you’re taking a long-term viewpoint. While you’d want to keep your expenses as low as possible, a long-term funding plan allows you to create a more consistent and effective marketing technique.
5. It’s an investment in your remodeling business’s growth
When it comes to marketing, many remodeling business owners look at it as a necessary expenditure rather than an investment. It’s vital to remember that marketing isn’t simply another expense for your business; it’s an investment. Marketing is a form of investment in your company’s growth and success.
You can help your company get the most out of its investment by learning how to create a marketing budget.
How to Plan A Marketing Budget for 2022 In 6 steps
It’s time to look at how to create a marketing budget and prioritize it after you know why one is required. Check out these six crucial factors for creating your marketing budget.
1. Create A Sales Cycle for Your Product or Service
You need to establish your sales funnel when you create your marketing budget breakdown. Your sales funnel is an important element of your marketing budget since it indicates where you’ll spend your money. The sales funnel is the path your audience takes to become a paying customer.
The following is a description of the four stages in a typical sales funnel:
- Awareness: Your audience is now conscious that they have an issue, and they’re on the lookout for solutions.
- Consideration: At the consideration stage, your audience begins to explore the alternatives available to them.
- Decision: They begin to narrow their attention to companies that provide the greatest solution or product for their needs when a lead reaches the decision stage.
- Action: Customers are attracted to your company after they fall in love with your service and choose it as their preferred business.
Sales funnels allow you to view where you might require a digital marketing approach to retain more people from leaving the funnel.
Let’s assume your company has a very long sales funnel, with many people at the consideration stage but few who reach the decision stage. While some attrition is unavoidable, you notice that the drop-off rate is greater than what you’d anticipate.
As a result, you may need to allocate extra money for methods that will help move leads from consideration to decision. Video marketing, pay-per-click (PPC) advertisements and social media ads are all examples of such strategies.
So, in order to help you determine how much money you’ll need for marketing, it’s important to grasp your sales cycle.
Knowing your sales cycle will assist you forecast measures you’ll need to fund for your marketing plan, which will help you manage your budget.
2. Understand Your External Expenses
If you want to know how to make a marketing budget, start by calculating your external expenditures. You’ll need to figure out how much everything costs your firm so that you can set aside money for marketing. So, what are some of the outside expenditures that you should consider?
- Operational costs (creating products, shipping them)
- Costs for employing staff
- Costs for running your business (electricity, water)
- And more
When developing your marketing budget plan, be sure to account for these expenses. Not only does it influence what services you may invest in, but it also establishes a benchmark for your return on investment (ROI).
So, for example, let’s suppose that producing your product costs you $10. You sell your goods for $50. So, when it comes to marketing methods for your company, you’ve decided how much you want to spend in order to still make a profit on your product or service. This knowledge will assist you in finding methods that will provide the greatest return for your organization.
3. Determine Your K&B Business’s Goals
Setting a marketing budget is not as simple as following some steps. Every guide on how to create a marketing budget will tell you that you must first determine your K&B company’s objectives — and it’s correct! You should know what you want to achieve in order to establish a budget that allows you to do so. You may focus your goals on the following areas:
- Earning more sales
- Increasing leads
- Earning more subscribers
- Increasing brand awareness
- And more
Make sure the goals you establish for your company are precise and wise. You don’t want to create a goal like “enhance sales.” It won’t provide you with a clear objective to aim for and achieve.
Instead, make a goal like “Increase sales by 20% at the end of the year.” This objective is easily measurable and provides your team with something clear to accomplish. The best way to justify marketing spending is by establishing a goal for growth. When it comes to marketing, the most important thing is knowing how much you want to boost sales and when you’ll be able to do so.
If you want to properly create a marketing budget, start by including your company’s overall objectives so that you may invest in the most appropriate marketing techniques to help you achieve your goals.
4. Understand Your Market
To create an effective marketing budget plan, you must first determine where you fit in your market. You can better determine which tactics you need to use to compete with them when you know how you stack up against your competitors.
You should conduct a competitor study to discover how well your competition does online. You may also make use of competitor analysis tools to determine where your competitors currently excel online.
It may assist you in determining which tactics you’ll need to budget in order to achieve your goals.
You may use a competitor analysis tool like CompetitorSpyFX to examine competition campaigns and obtain ideas for your own efforts, or you may utilize social media monitoring tools to follow what individuals have to say about rivals on social media.
5. What Tactics Do You Want to Employ?
Choosing your marketing approach is an important component of preparing a 2022 budget. You don’t have to be absolutely sure about the approaches you want to utilize, but you should have a sense of which arrangements seem to be the most appropriate for your company. There are many digital marketing techniques accessible, including:
- Search engine optimization (SEO): The goal of search engine optimization (SEO) is to improve the ranks of your website in search results in order to generate more relevant, organic traffic.
- PPC advertising: PPC advertisements are paid advertisements that appear at the top of search results pages and on other websites. These advertisements enable you to contact more prospects who are ready to convert.
- Social media marketing: Social media marketing allows you to engage with your customers on a one-on-one basis and provide useful information to them. This method enables you to form relationships with leads and turn them into paying clients.
- Social media advertising: If you use social media advertisements, your objective is to develop compelling ad copy that is tailored to particular leads. These ads appear seamlessly in their newsfeed and help you establish brand recognition while also increasing lead counts.
- Email marketing: You may nurture leads towards conversion by sending them tailored material that appeals to their passions using email marketing. You may send discount offers, product information, abandoned cart notifications, and more promotional emails.
- Content marketing: Blog posts or videos can help you generate more leads for your site by offering useful content to your audience. Whether it’s a blog post or a film, you may enlighten people and establish yourself as an expert in your field by spreading knowledge.
- Local SEO: Local SEO optimizes your listing on Google Business Profile for local phrases, allowing you to increase local traffic to your company. You can see an example of a GBP listing below!
When creating a marketing budget, you’ll want to have an idea of which methods you’d like to employ for your company. You can figure out how they’ll fit into your marketing budget plan once you know which strategies you want to invest in. Our next key component in how to create an advertising budget is determining the sum of your marketing expenses.
6. Methods For Conducting Research Vary
Whether you want to run your campaigns yourself, hire a freelancer, or engage a digital marketing company, you need to know how much they’ll cost. Your K&B business’s marketing budget breakdown should concentrate on how much each technique will cost your company. To begin, you must choose who will manage your campaign:
- In-house: The expense of maintaining an in-house staff will be paid for through personnel costs and supplies required to execute your campaigns. You may still need to engage the services of outside help or invest in technology that helps you manage your activities.
- Freelancers: Freelancers are individuals who specialize in one area of expertise or dabble in a few. Hiring a freelancer usually costs by the hour or on a per-project basis. If the freelancer is more experienced or uses software that they charge for, the fees may be greater.
- Digital marketing company: You’ll get everything you need, from tools to personnel if you hire a digital marketing company. You’ll pay per month to retain a digital marketing company on retainer unless you’re working on a one-time project.
If you’re busy running your company, you’ll want to outsource most of your marketing job to a digital marketing company. It allows you to take advantage of having a marketing plan and someone to execute it quickly.
Get to Know Fabuwood Cabinetry Corporation:
With a marketing budget that is imperative to the success of any business, we realize that remodeling company owners are constantly seeking for fresh and high-quality goods to sell to their consumers.
In this episode of Remodeler Success, we talk with Charlotte Brown, Operations Coordinator at Fabuwood Cabinetry Corporation. During the interview, she also introduces us to their most recent products. As a leading cabinetry company in the United States, Fabuwood offers an unprecedented combination of style, selection, and affordability. Their product is made with high-quality materials to satisfy the most demanding consumer while their designs provide inspiration for any project. We understand how they maintain high-quality standards while still being quick enough for the market! Check it out; you won’t be sorry!