As an entrepreneur you will probably wonder whether you spend enough on marketing. Of course, it is not easy to give a uniform answer for all companies. Every industry requires a specific approach and its own budget. Yet there are rules of thumb for this.
Personally, I like the rule of thumb that could be quite right for B2B companies that have already had a few start-up years. The rule of thumb for these companies would be:
“5% if you want to continue, 10% if you want to grow”
So do you spend less than 5% of your turnover on marketing? Then you would actually slowly deteriorate! Of course, this rule of thumb can only apply with a budget of a little size. With a turnover lower than € 250,000, the marketing budget becomes too small at 5% to really achieve anything.
How do I know if I am sitting correctly?
Often it works best to take a look at the competitors or comparable companies in another industry that you see as successful. What are their marketing budgets spent on? Through which channels do they do this? Do they shoot with hail or do they reach exactly the right target group? Spend some time ‘Googling’ for search terms related to your own services or products. Is it always the competitor that is visible? And why is that? Is there a bit of an uncomfortable feeling bubbling up now? Then you are not quite right yet.
Then what do I spend money on?
If you have then decided to put in a substantial amount for marketing, you naturally want to spend every euro well. You can spend your marketing budget really easily. This blog is not written to elaborate on all these things, but I still want to give you something to divide your budget into jars. You can divide your budget into:
- Outbound Marketing
- Inbound Marketing
- Personal belongings
- Sample balloons
Why this classification?
Outbound is the classic marketing: calling, advertising, fairs, etc. and is aimed at the short term to bring in customers on the basis of the best possible hail shooting.
Inbound is the new way of marketing: blogging, sharing knowledge, winning customers based on first sowing and then harvesting.
Staffing is really necessary, even if you only start with an intern who supports you as a management, because marketing in particular needs constant attention. And an intern also often provides surprising insights that you would not have thought of yourself. You need
trial balloons to discover what really works for your company, so make room for that in your budget.
How do you make it fun?
I do hear from some entrepreneurs that it is not their thing or that they just don’t like it. That may be of course, but marketing is the front line when it comes to growing your business. What helps is to compare your growth goals with your marketing resources and measure what delivers which channel or which action. For example, register for each new customer how they arrived at your company and try to discover how they were influenced during the sales process. And what also helps … celebrate a success!