How to measure marketing investment spending to control budget and expenses by category?
Let’s say your company decided to invest in a new website design to improve lead generation, and you are responsible for managing the project.
Of course, one of the first questions you have is, “How much will it cost?” The answer, of course, is: “it depends”. Are you simply switching to a new model and adding some new CTAs or are you migrating the entire site to a new platform?
If only there were a way to organize your answers to all of these questions – a place where you could enter the estimated costs and compare the projected marketing budget with what you actually spend – everything would be easier.
If you are a small business, you may wonder what marketing expenses to start with. If you have a big business, having multiple teams or marketing operations at stake can make it difficult for everyone in the department to get what they need.
When creating a marketing budget, here are a few things to keep in mind when planning your spending:
Software: When it comes to digital media and even printing, you may need software to create your marketing campaigns or manage your daily processes.
Freelancers: If you have a temporary campaign or want to test a new marketing strategy, you can hire a short-term freelancer before starting a full timer.
New staff: When hiring full-time employees, you can budget for costs, including the computer, technology, benefits and integration-related needs.
Advertising: Calculate how much money you spend on paid opportunities, such as physical standards, sponsored content, research applications and social media promotions.
Content creation: When creating content such as videos, photos or even blog posts, you will need to dedicate paid time. Calculate how much money will be spent creating this content so you can adjust accordingly based on your return on investment.
Know your user’s journey
The journey is the step that your target audience takes as they go from discovery to purchase. Knowing this path allows you to understand how your audience interacts with your marketing – and where to set your goals and budget to better reach your customers.
Ask yourself these questions when defining your buyer’s journey:
- How do your leads and customers typically discover your products?
- What do they need to know before making a purchase?
- How many visits to the site do you have per month?
- How many leads are you generating per month and how many of them are converted into paying customers?
- What does it cost to generate new leads and convert them into customers?
- What is the value / revenue of each lead?
This process should indicate what the marketing tactics are (including those that are not working), to change what is necessary and to be able to better focus your budget.
Align your budget with your marketing goals
What you spend and where you spend it will depend on what you are trying to accomplish. So, when creating your marketing budget, make sure you’re only spending money on the things required by your current marketing goals – goals set based on your target audience and the prospect’s journey. These may include:
- Show ads to promote a new product you are launching;
- Sponsored social media posts to generate followers on your Facebook / Instagram page;
- Paid search engine ads to drive traffic (and purchases) to a specific product page;
- Hire digital influencers to get more organic search traffic on your company’s website.
Watch out for hidden expenses
One of the great advantages of having and maintaining a budget spreadsheet is that it helps to avoid some end of quarter or end of year outbreaks, such as: “What did I spend all that time and money on, huh?”.
In many cases, unforeseen costs can force marketers to spend money they did not plan to spend. Product marketing offers a perfect example. It is easy to forget that successful marketing of your products and services requires more than just promotion.
Another area of focus to remember is the reservation of resources to carry out research and testing of messages long before the product reaches the market. It is essential to have conversations with customers about the pain points that your product will resolve in the end. To shape the messages and have a successful launch.
Remember where your priorities are
Marketing is full of add-ons and extras, upsells and “premium” versions. One of the best ways to assess what is good versus what is absolutely necessary is to organize all your expenses.
Keeping track of where your budget is being allocated and checking the spending on the results you are getting, it will be much easier to find out what should continue to receive the budget and what should be discarded.
As you work through your marketing budget, line by line, it becomes clearer what you can afford, according to your priorities. Evaluate your marketing budget quarterly and annually to see if your projections are in line with your actual spend. By monitoring your marketing costs and refining your efforts, you will be able to generate more accurate quotes over time.
To help you with this process, we have created a budget template that is an Excel spreadsheet in several languages, designed to help you manage your company’s marketing budget.
It allows you to control your budget and expenses by category, including social media, web marketing, content marketing, research, local marketing, public relations and more.
Track your expenses monthly and compare with your estimated budget. Use our reports to view and follow your budget to avoid unpleasant surprises.
Get the most out of your marketing!