It is a necessary evil that small businesses and start-ups should figure on anywhere from 15–20% of gross (or projected) revenue toward a marketing budget. This percentage can back off to 7–12% after the initial “we are here, we are here, we are heeeeeeere” (to borrow from “Horton Hears A Who”) phase is complete (usually three years—if you've aggressively marketed yourself!).
Small and start-up businesses obviously don’t have the same kind of marketing budgets as larger companies. There are formulas that can be used to determine how much your inbound marketing dollars can/should bring you relative to ROI, but in a nutshell, here is some “frame of reference” information relative to what should be considered in your overall marketing plan.
1. Establish and Expose Your Brand
An initial branding package from a reputable design/marketing agency should include, at a minimum:
- Intake discovery session
- Custom logo
- Tagline (if necessary)
- Complete print and digital stationery package
- E-signature block(s)
You can safely say a starting budget range for establishing your brand will be from $4,000 — $7,500, depending on how much up-front research and discovery is made by the design firm on your behalf, relative to competitors, personas, etc. Complete branding packages for larger companies can run in the tens (if not hundreds) of thousands of dollars, and include extensive strategy meetings and focus group studies before pencil is even put to paper for logo design.
2. Website Presence
Chances are, you’ve already realized the importance of a website in your overall marketing mix. In today’s digital world, a website is as important, if not more so, than your business card. Unfortunately though, small businesses sometimes assume (incorrectly) that “Oh, we can just throw something together to start with—just to show people we have a website.” Which is the same as saying, “Oh, we’ll just throw some money into a hole and wait for it to grow.”
A well-executed website, like your initial branding, needs planning and strategy behind it to make sure it’s conveying:
- Your company’s personality
- Your brand message
- What your target customers are looking for
There are plenty of inexpensive DYI website options out there, but unless you already have a marketing background, your dollars are much better spent budgeting $5,000–$7,500 for a well-functioning, custom-branded website developed by an experienced design firm. After all, I’m sure you have much better things to do with your time!
3. Inbound/Outbound Marketing Efforts
Budget allocation between inbound (i.e. social media marketing, blogging, e-mail marketing, etc.) and outbound marketing/advertising (print and web advertising, outdoor, environmental and tradeshows) should be identified based on your target customer personas and overall marketing spend. A minimum monthly advertising budget of $1,500–$3,000 can entail:
- Social media marketing
- Blog writing (four per month minimum recommended)
- Hyper-local print and web advertising
Of course, just like with anything, more aggressive advertising can be mapped out in your marketing plan, depending on your budget.
Bottom line: a comprehensive marketing “blueprint” will establish a sturdy foundation for spending your all-important marketing dollars to achieve the most effective, far-reaching results for your particular budget and goals.