Now They Know
How Much Should You Spend?
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Theories on how to set a marketing budget range from a certain
percentage of net revenues to whatever is left after all the bills
are paid. While there's no formula to tell you the
"right" number, these guidelines can tell you whether
you're in the ballpark. 1. Check out your competitors.
With a bit of sleuthing, you can discover how your competitors are
reaching their customers and estimate their expenditures. If their
efforts appear to be working, you might consider matching their
marketing dollars.
2. Find similar noncompeting businesses and find out what
they're doing. Industry associations and even the Net are
great ways to find people who do what you do in noncompeting
markets. You may be surprised that many business owners are eager
to help each other-especially when they're not vying for the
same customers. 3. Budget more for a start-up. It takes more effort-and
often, more money-to make a name for a new business. Content Continues Below
4. Review your plan periodically and adjust your expenditures
accordingly. Just because you have a plan doesn't mean your
expenses are written in stone. Be sure to review how your marketing
dollars and time are being spent to see what's working and what
needs to be modified. The bottom line when it comes to your marketing budget is-well,
your bottom line. Be sure the amount you dedicate is going to be
manageable for your business. Marketing Mishaps to AvoidWhile there are plenty of ways to mess up a marketing campaign,
new business owners typically fall prey to four particular
pitfalls: 1. Saying too much: When you jam too many messages into
any one marketing vehicle, you risk losing your audience entirely.
Focus on one or two key messages for each marketing effort. 2.Being inconsistent: If each piece of your print
marketing materials looks as if it's from a different company,
you're not likely to be effective. 3. Cutting your marketing budget first: When cash flow
dips, it's more important than ever to keep up your promotional
efforts. Don't be tempted to make marketing your first cut when
it's time to slash expenditures. 4. Hiring a big agency with a small budget: Like most
businesses, advertising, public relations and other marketing
consulting agencies come in different sizes and price points. If
you need to hire help on a shoestring, look for a small to midsized
agency where your dollars and your business will be treated with
the respect they deserve.
Gwen Moran helps
small businesses with marketing through consulting and
writing.  - Best
Businesses to Start in
2005  | | | Free Financial Software
Included with every Start-Up Guide
order. |
Originally published in the February 2003 issue of Entrepreneur's StartUps
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