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16 Ways for Creating a Marketing Budget (and How to Spend It)

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There’s no such thing as a perfect marketing budget. The right allocation of resources hinges heavily on your business, your customers, and more.

If you’re just getting started with marketing (or even if you’ve been in the game a while), that can make budget allocation a prickly subject to tackle—how do you even approach it? But when your business depends on solid marketing to grow and thrive, solving the riddle of marketing budget allocation falls to you.

So why create a marketing budget? How do you find the right distribution of tactics and budget for you?

While there’s no right answer, we asked 52 marketers to share their best tips for allocating marketing budget. Here’s what they had to say.

What is a Marketing Budget?

• Why is it Important to Have a Marketing Budget?

What is Included in a Marketing Budget?

16 tips for creating a marketing budget.

A marketing budget can be best described as an estimation of a business’ revenue and expenses for specific marketing related projects  (promotion of its products and services) over a specified period of time (monthly, quarterly or yearly).

Marketing budgets are usually drawn up to cover expenses such as payment for new marketing software, website maintenance, speaking engagements, paid advertising, and so on.

Why Is It Important to Have a Marketing Budget?

Regardless of the size of your business, the benefits of setting money aside for driving awareness, boosting sales and revenue through your marketing efforts cannot be overstated.

So below, we’ve put together a few reasons why having a marketing budget for your company is important.

1. It allows you allocate your resources effectively

Having a marketing budget allows you to keep track of all your expenses, cut down on unnecessary costs and allocate your resources only to marketing projects that support your marketing goals and are likely to generate good results both short term and long term.

2. Easily track your ROI

When it comes to creating a marketing budget for the new fiscal year, one way to assess how marketing contributed to generating revenue, as well as the ROI for your marketing efforts is to dive deep into your marketing budget. How much did you spend? How much profit did you make? Does it make sense to focus on certain projects next month, quarter or year if they’re not resulting in more leads, sales, etc?

Related: Best Tips for Calculating Marketing ROI

3. It encourages long-term planning

A marketing budget does not only cater to your current marketing needs but also covers future projects. A great practice would be to have your marketing budget closely aligned with your marketing or business goals/plan. So, for example, if you plan to publish 20 blog posts in a quarter, ideally, you would also want to ensure your marketing budget covers expenses such as the cost of hiring freelancers, paying for an SEO tool to help with keyword research, etc

4. Keeps everyone motivated

Team members will be better motivated to put their best foot forward when they know that the company prioritizes funding tools, marketing reporting software , and resources that will help them do better work. Hence, why having a marketing budget is important. It communicates the company’s goals, priorities and involves team members by asking for their opinions on what the company should be spending on.

Before we get into the details for effectively creating your marketing budget, it’s important to quickly review the things you should include in yours in order to create an accurate and realistic budget.

Typically, the following should be included in your marketing budget:

• Software/Tools: Think your email service provider (ESP), any automation tools, analytics tools, web conferencing software, etc. You can include web hosting and domain renewals in here, too.
• Salaries:  The salary of those on your marketing team should be included in your overall budget, too.
• Outsourcing: Does your team hire freelancers, temps, or paid interns for specific projects? It’s important to work that into your budget.
• Advertising Spend: Whether you’re advertising in search engines, social media, video, podcast, or even print.
• PR Costs: Using a paid service to distribute your press releases? Include that in your marketing budget.
• Events/Trade-show costs:  These tend to eat up a lot of marketing resources, so plan accordingly.
• Swag: T-shirts, stickers, hats, etc. 
• Training: Does your company help employees level-up with relevant training courses? That could fall under your marketing budget, too.
• Gear: Cameras, microphones, lighting, and other equipment to help your team create multi-media content.

So how should you organize and prioritize these channels for your marketing budget? Here are 16 tips we gathered from our respondents on how to develop a marketing budget.

• Have an Attribution Model in Place to Measure Performance
• Consider Your Overall Marketing Goals
• Remember That Marketing Channels Interact
• Align With Your Sales Team
• Don’t Rule Anything Out
• Start Where Your Team’s Expertise Lies
• Choose Channels Based on Your Audience
• Allocate More to Efforts With Proven Results
• Don’t Be Afraid to Cut Your Losses
• Follow the 70/20/10 Rule
• Research How Competitors Invest Their Marketing Dollars
• Test What Works for Yourself
• Avoid Putting Your Eggs in One Basket
• Spend More on Customers Deeper Into the Funnel
• Don’t Overlook the Top of the Funnel
• Be Flexible and Adaptable

PRO TIP: How Are Users Engaging on My Site? Which Content Drives the Most Online Activity?

If you want to discover how visitors engage with your website, and which content drives the most engagement and conversions, there are several on-page events and metrics you can track from Google Analytics 4 that will get you started:

• Sessions by channel. Which channels are driving the most traffic to your website? 
• Average session duration. How long do visitors spend on your website on average? 
• Pageviews and pageviews by page . Which pages on your website are viewed the most? 
• Total number of users . How many users engaged with your website? 
• Engagement rate . Which percentage of your website visitors have interacted with a piece of content and spent a significant amount of time on the site?
• Sessions conversion rate . How many of your website visitors have completed the desired or expected action(s) and what percentage of them completed the goals you’ve set in Google Analytics 4?

And more…

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1. Have an Attribution Model in Place to Measure Performance

“Unless you know which campaigns and efforts are generating actual revenue, you’re resourcing your business blindly,” said Martin Shirvington of Plus Your Business .

Many of the responses we heard centered around tracking performance and adjusting your allocation accordingly. But long before you spend a dime, you need to have systems and tools in place to measure that performance.

“Trying to determine where to spend money without knowing how each channel is performing is like playing darts blindfolded,” said Quincy Smith of Ampjar . “Define and set up tracking for your marketing channels, so you know where the best ROI lies— before dumping any money.”

Kelley Wrede of Revenue River pointed out that, until you test and measure marketing campaigns, you really have no idea what will work.

“You may not know how things are going to work out the first time you invest in them, but if you collect data and can attribute dollars spent with dollars earned for each channel, the allocation process will become much more intelligent and successful for your organization over time.”

Gazelle Interactive ’s Ryan Walker suggested using an analytics tool that employs the same attribution model across all of your marketing channels—so you get the most holistic view of the real value of each.

Shervington and team use HubSpot Pro because it connects marketing channels (like AdWords and Facebook Ads) and allows you to attribute “at the most granular level.”

Additionally, you can leverage a great tool like our marketing dashboard software to monitor, assess and report on your most important marketing KPIs and metrics.

Editor’s note: Want a more visual way to report and analyze how your marketing channels generate leads and turn them into customers? Download this free HubSpot Sources Report dashboard to view sessions, MQLs, SQLs, customers, and more—all broken down by source.

2. Consider Your Overall Marketing Goals

One of the big questions we wanted answers to was what drives marketing budget allocation? We asked the marketers we spoke with to share the most important factors that help them determine marketing budgets.

Around 40% of respondents told us that alignment with overall company goals was the single most important factor in driving their marketing budgets.

“With objectives and strategy written,” said Daleep Chhabria of Growth Forte , “you might, for example, narrow down to PR, website, SEO/content-writing, social media for amplification, promotions, and a few marketing technologies.”

“Are your goals reach-related or revenue-related?” John Donnachie of ClydeBank Media asked. “Are you trying to increase awareness for a new product or are you trying to increase sales for an existing product?”

Jonathan Aufray of Growth Hackers added, “Does your company want more visibility? Do you want more sales? Do you want more downloads? Once you know your company’s goals, you can put more marketing dollars on the channels that will help you move the needle.”

See also : 13 Tips for Setting (and Achieving) Your Marketing Goals

3. Remember That Marketing Channels Interact

One unique tip we heard was to avoid taking a zero-sum approach to marketing channels—because they all work together and affect one another.

Adding to Perreault’s comment, CodeCrew ’s Alexandra Marin explained, “Successful marketing is a fine combination of multiple factors.”

“If any of them is left behind,” Marin added, “the long-term resolve of your efforts may be disappointing—even if short-term results look good. ”

4. Align With Your Sales Team

Marketing budget allocation isn’t just about the marketing team. It requires input from throughout the organization, and that includes the sales team. Collaboration between the sales and marketing team is an excellent practice to strive towards—so G2 ’s Deirdre O’Donoghue told us you should define those goals together, before you worry about allocating spend.

5. Don’t Rule Anything Out

“It’s easy to make some assumptions and guesses about how certain channels will perform, but you won’t actually know until you experiment,” explained Corey Haines of Hey Marketers .

Vivek Kumar of Qlicket agreed, adding that “any good marketing team must first all of their options first, before executing on any tactics.”

Kumar says their team followed the process set forth in Traction , a book written by Gabriel Weinberg and Justin Mares. The book outlines nineteen “traction channels” for marketers to test, weighing the costs and benefits as they go.

“From there,” Kumar said, “we were able to draft a marketing plan with the security of knowing that we considered all of our options.”

6. Start Where Your Team’s Expertise Lies

We’ve heard tips about setting up attribution models and drawing allocation from your goals… but you always have to start somewhere. Chane Steiner of Crediful recommends that very first somewhere is wherever your in-house team has some level of expertise.

“Start with one marketing channel at a time, and begin with wherever you have in-house expertise,” Steiner said. “Of course, you can’t stop there. Expand one channel at a time, continuing to A/B test your way into a position that generates ROI. From there, you can experiment with optimizing your ROI.”

7. Choose Channels Based on Your Audience

John Donnachie of ClydeBank Media asked, “Where do your customers spend their time online? What channel makes the most sense to reach them?”

“Understand your customers and their buyer’s journey before allocating budget to marketing activities,” suggested Kyle Turk of Keynote Search. “Don’t waste your budget on marketing initiatives that don’t directly impact your core customer group. If your target audience isn’t on Instagram, for example, don’t allocate money to Instagram ads.”

8. Allocate More to Efforts With Proven Results

“After a few months to a year of promoting the business, you should check the ROI of each marketing medium using a marketing dashboard , and allocate your budget based on that number,” said Hassan Alnassir of Premium Joy .

Once your marketing program is rolling and set up to track performance across channels, allocation becomes as simple as doubling-down wherever you see positive results—and cutting your losses where you don’t.

Stacy Caprio of Conversiono recommends starting small, with budget spread relatively evenly across channels. “Once you have data that shows which channels are converting to paid customers in the most profitable way, you can start funneling more money into those channels.”

Hill Gaming Company ’s Casey Hill outlined the two-step process they use with clients:

• Identify which platforms work for the client’s audience and where there are initial indicators of engagement
• Test and iterate to refine the allocation

Hill also recommended the wider focus of ROI, similar to Cook’s sentiment around time and energy investments. “Focus on where you can consistently produce quality content because you enjoy it. If you hate writing, don’t do a written blog—try video, or interviews, podcasts, etc.”

Editor’s note: Want an easier way to see how marketing channels contribute to revenue? Download this free Google Analytics Product Revenue dashboard to view revenue across products, sources, and more.

9. Don’t Be Afraid to Cut Your Losses

Drawing from that data-backed approach to allocation, several marketers advised that you can’t be afraid to cut your losses. Don’t fall victim to the sunken cost fallacy—just because you’ve invested in a channel doesn’t mean you must (or should) keep pouring money into it.

“Don’t be afraid to move on from bad content,” warned Cristina Maria of Commusoft. “Many marketers seem to think that if they pour dollars into a channel that isn’t working well, it will magically transform it. Whether it’s Facebook Ads or paid Instagram Stories, you need to track ROI and cut your losses if it’s not working.”

“Don’t fall in love with a particular channel,” advised Robert Donnell of P5 Marketing. “We see too many clients that are enamored with SEO or Facebook—to the exclusion of other channels. We have to be objective about the allocation.”

In other words, kill your darlings and cut your losses.

10. Follow the 70/20/10 Rule

Wes Marsh of BCA Technologies told us they have a hard-and-fast guideline for marketing allocation:

“Put 70% of your budget into proven marketing channels that give you the best blend of quality leads at a low cost per lead, and then squeeze as much as you can out of it. Put 20% into other channels that still offer quality exposure and lead generation, even if there is less direct attribution (i.e. display, video, etc.). Finally, keep the remaining 10% of your budget available to explore new channels and for testing.”

Hey Marketers ’ Corey Haines also recommended leaving a portion of your budget available to experiment with new campaigns. “For every channel that you invest marketing dollars into, give yourself the ability to experiment with a portion of the budget. Even a small experimental budget,” Haines explained, “can go a long way in exploring new ways to use the channel, figuring out what works and what doesn’t, and exercising your creative muscles.”

11. Research How Competitors Invest Their Marketing Dollars

At some level, the right marketing channels for your business come down to your industry and business model. That means you can glean some value out of researching how your competitors allocate their marketing spend.

“I’d start by looking at several competitors to identify a trend in the pattern of their traffic sources,” Dresean Ryan of Dresean Consulting suggested. “Analyze some of the competitors in your industry with tools like SimilarWeb to see where they’re investing most of their advertising dollar—by looking at their traffic source, you’ll be able to tell where most of their budget is going.”

12. Test What Works for Yourself

“Test, reallocate budget, test some more, reallocate some more, and so on. Amplify your successes and don’t be put off if something doesn’t work at first,” recommended Oliver Roddy of Catalyst Marketing .

Corey Haines of Hey Marketers explained, “It’s easy to make some assumptions and guesses about how certain channels will perform, but you won’t actually know until you experiment.”

The marketers we heard from recommended starting with small budgets and testing to see what works. “Figure out what’s working and then turn up the dial accordingly,” said Zaahn Johnson of The Kingdom .

“Only through testing each channel will you be able to determine where to allocate larger percentages of your marketing budget,” said Alistair Dodds of Ever Increasing Circles . “When you find a channel that absolutely flies and is delivering high ROI, be prepared to scale up quickly.”

“Make sure that you invest in a channel where you can accurately measure the metrics of your return,” noted Software Path ’s Megan Meade. “That way you can identify the most profitable areas for future investment and scaling up with the data.

13. Avoid Putting Your Eggs in One Basket

While it’s important to direct your budget toward the most profitable marketing channels and activities, you should also be mindful of investing too much in just one channel. For example, if you spend 90% of your marketing budget on SEO and Google changes their algorithm… you’re out of luck and out of budget,

David Hoos of The Good suggests, “If you find wild success with one channel, that doesn’t mean you should abandon the others. You don’t want to have the success of your business riding on a single channel.”

It seems like the marketers we spoke to our following this best practice, too. We asked, on a scale of 1-10, which channels do you typically invest more dollars into?

While content marketing emerged as a clear leader, the answers were pretty evenly spread—with SEO and email marketing being just behind content, and Facebook and Google Ads in the top half, as well.

14. Spend More on Customers Deeper Into the Funnel

“My one piece of advice,” said Sara Bennett of PACE Staffing Network , “is to start further down the marketing/sales conversion funnel and work you way up as you can based on resources (money, time, etc.).”

“It’s imperative to understand what stage your customer is at in the sales funnel,” explained Lewis Kemp of Lightbulb Media .

“I have always seen my marketing efforts for where they are on the conversion funnel,” added Bennett. “That often correlates to how quickly you’ll receive a return on your investment.”

“I encourage marketers to invest in channels that are further down the conversion funnel (like lead generation, SEO, and Google Adwords) because there’s much less financial risk—and you’ll see ROI faster. Once these marketing channels are operating to a satisfactory level,” Bennett explained, “you can begin investing in channels higher in the funnel, until you work your way up to awareness and exploratory research.”

Kemp went on to echo Bennett’s advice about starting your investment deeper in the funnel, adding that marketers should “utilize cost effective channels (like paid social and email) higher up the funnel. Once the brand becomes more established, make the move to higher yielding and intent-based marketing channels (like Google and LinkedIn Ads).

15. Don’t Overlook the Top of the Funnel

I know we just talked about investing in the bottom of the funnel. And if you can only invest a little, that’s a good place to do it. But for marketers who have a little more wiggle room, it’s important not to overlook the top of the funnel.

As Brooks Manley of Engenius advised, “Don’t neglect investing in the top of your funnel. You won’t see the returns as quickly, but your sales funnel a year or two down the road will thank you.”

16. Be Flexible and Adaptable

“Marketing changes daily. What worked today might not work tomorrow, so you need to have the flexibility to move dollars around,” said Kyle Turk of Keynote Search.

“Shifting budget to high performing marketing channels and activities from low performing ones, requires you to be flexible and adaptable—and enables you to maximize ROI,” Turk explained.

“Evaluate what’s been done already. Reevaluate where your customer is spending their time Shift dollars there,” advised Maria Kiagias of Social Gold Group . “It sounds easy, but it’s hard for many businesses to let go of older marketing initiatives.”

Jacob Landis-Eigsti of Jacob LE Video Production told us adaptability is also a key component to being able to double-down on investment when you find something that really works.

“When you’re testing a strategy, you can keep spending low. But when you find a plan that works, keep putting money towards. I spent $400 a month while testing and ramped that up to $3,000 a month when I found a strategy that works.”

Allocate Your Marketing Budget for Better ROI

We heard a lot of tips from the marketers we spoke to, and they all boil down to a few key takeaways:

• Be open and objective to testing new and varied channels and campaigns
• Start small, based on any info you can get your hands on
• Spread your allocation across multiple channels and throughout the marketing funnel

By following those basic rules and adapting to the results you see, you’ll find the right allocation for your marketing budget—and maximize your ROI along the way.

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How to Create a Small-Business Marketing Budget

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A marketing budget is an estimate of how much money a business plans to spend on marketing its products or services during a given timeframe, such as a year. Costs that should be taken into account when creating a marketing budget include marketing software , staff payroll, ad campaigns, signage, promotional materials, events, digital assets and potentially third-party services.

Your marketing budget is both informed and dictated by your marketing strategy, which should determine your business's goals, customer base, market niche, branding and preference. Failing to create a marketing budget could lead your business to overspend and affect your broader business budget , or underspend and deprive your business of the exposure it needs to establish a strong customer base. But it's also important to remember that this is an estimate and can be adjusted as your business evolves.

Determine your marketing goals

Your goals are the results you want your marketing efforts to yield. The end goal of all marketing is to grow your business in some way by increasing sales, but you want to try to be more specific. Examples of marketing goals could be to drive traffic to your company website or increase engagement rates on social media posts. The more specific your goals, the more clear your strategy — and the spend associated with it — will be.

Think like your target audience

Your target audience is the group of people most likely to transact with your business. You'll want to tailor your marketing outreach to best reach this group and convert them into paying customers. Performing market research can help you narrow down who this group is, as well as how they discover and interact with businesses like yours. Whether it's through social media, email, direct mail, commercials, search engines, or other means, knowing what platforms you'll incorporate in your marketing plan will help you estimate the costs associated with them.

Consider your revenue

Many businesses base their marketing on a percentage of their gross revenues. The benefit of this approach is that your marketing budget will rise along with your sales. However, keep in mind that marketing generates sales — not the other way around. That means a startup business likely needs to budget a disproportionate percentage for marketing compared to its sales.

For new businesses, look at your sales projections for your first year in business — this should be part of your business plan . For more established businesses, you can leverage real data and financial reports to determine your revenue and how much of your overall budget you can allocate to future marketing based on your goals.

The average marketing budget in 2022 was 9.5% of a company's overall revenue. [0] Gartner . How CMOs Are Spending Their Marketing Budget – and What It Means for You . View all sources This figure will vary across businesses based on size, industry, revenue and more. There are also plenty of low-cost and even free advertising tools to help keep your marketing costs down.

Use budgeting templates and tools

Free business budget templates abound to help you calculate your marketing budget. You can also consult SCORE's annual marketing budget template , as well as the organization's other small-business resources. If you're looking for something more automated, budgeting software is designed to help you manage, track and forecast budgets. However, before you pay for standalone software, first check with your accounting software . Many of these platforms include budgeting and forecasting tools and since they're already tracking your business's other financial information, you don't have to worry about transferring data between programs.

A version of this article originally appeared on Fundera, a subsidiary of NerdWallet.

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Optimize Marketing Costs for Better ROIs: The Ultimate Marketing Budget Guide [2024]

Sudarshan Somanathan

Head of Content

February 8, 2024

Anyone in the finance profession would confirm that planning a marketing budget is both an art and a science. You go super generous with funds, and there’s the risk of blocking other growth investments. But if you spend too little, your whole sales funnel will go awry! 😅

Calibrating your marketing spend is a non-negotiable part of aligning your business goals with overall marketing initiatives. But there are several roadblocks to slow you down, such as the lack of reliable market predictions or process silos. According to statistics from MDG Advertising , 91% of companies believe that inaccurate data is the prime culprit behind misspends in marketing.

The average marketing budget constitutes almost 10% of the total company revenue , and no company can afford to waste that kind of resources on a budget that risks overspending and poor ROI. Luckily, we have just the right set of tips and strategies to help you out.

Our marketing budget guide will help you explore some core concepts to devise well-rounded marketing investments and avoid common pitfalls.

Bonus: We’ll also explore how to master effective marketing budget allocation with ClickUp , a free-to-use marketing and project management solution.

Why is a marketing budget important, and is it worth making one?

Where does a marketing budget go, what does a written budget for marketing campaigns comprise, how to calculate a reasonable marketing budget: common approaches, step 1: define your marketing style and goals, step 2: research what your competitors are spending on, step 3: create priorities for your marketing spend, step 4: set a cash reserve for unexpected costs , step 5: send the budget for approval, step 6: implement the budget and collect feedback regularly, relying on last year’s marketing budget, poor balance between traditional advertising and alternative marketing, over-prioritizing new customer acquisition, relying on inaccurate data .

What Is a Marketing Budget?

Any marketing plan aims to improve the company’s return on investment (ROI). You need to see if the campaign translates into enough revenue to justify the marketing costs. A marketing budget is your framework to carefully outline every marketing-related financial allocation within preset standards, ensuring you’re spending money toward fixed avenues. 

It encompasses every aspect of the marketing spend, specifying the who, what, why, and how of each anticipated expense, typically spanning across a quarter to a full fiscal year. 

This strategic allocation of resources ensures that your marketing strategies harmonize with overarching business objectives—you’re channeling funds into campaigns poised to yield the highest ROI and avoiding marketing investments that are not lucrative.

A proposed marketing budget generally undergoes scrutiny, approval, and allocation, often months ahead of the target marketing campaign. However, it’s a dynamic document, and you can always change it according to current business objectives, target audience , competitive landscape, and market trends. ⚡

Pro tip: Creating a budget for marketing spending is way easier if you have the right framework—i.e., marketing budget templates—to start with. Why not explore the ClickUp Marketing Budget Template ?

It helps convert even the most complex marketing budget outlines into easy-to-follow visual budgets. The marketing budget template’s comprehensive single-page overview helps you both forecast and make adjustments as you go.

Many marketers would argue that creating and updating a marketing budget is time-consuming as you can never get 100% accurate estimations. However, designing a robust marketing budget plan offers numerous advantages, enabling you to:

• Plan ahead: Allocate funds for projects several months in advance, ensuring effortless execution
• Expand resources: Recruit freelancers and niche marketing staff to smoothen your creative space
• Assess ROI: Calculate your Marketing Return on Investment (MROI) to make informed decisions that align with company objectives
• Demonstrate value: Show the value of marketing activities and budget allotment for all projects to company executives
• Measure progress: Compare year-on-year progress, tracking the effectiveness of each marketing project

In the past, traditional marketing teams used to prefer physical flyers, banners, and television ads for the company’s success. The situation has completely flipped in today’s era, thanks to a noticeably higher focus on digital marketing.

According to a 2023 Deloitte survey , companies spend over 50% of their marketing budget on digital marketing, with 19% going toward mobile activities and 17% toward social media ads.

Based on the latest trends, here are the cost centers of a standard marketing campaign:  

• Paid advertising, including PPC, banners, and TV ads
• Conferences, trade shows, or in-store exhibitions
• Brochures, graphic design, and product packaging
• Content marketing (blog and social media posts)
• Freelancers, influencers, and agencies for public relations (PR) tasks
• Surveys, focus groups, and market research activities
• Software, website maintenance, and digital infrastructure
• Giveaways and promotional materials
• Miscellaneous operational expenses

So, drafting a budget is not just about including financial information. You must add contextual components to your predictions so that anyone who reviews them can get a complete picture of the initiative.

A well-rounded marketing budget typically comprises of:

• Financial objectives: A clear outline of financial goals tied to marketing strategies
• Positioning strategy : Defines how the brand positions itself within the market 
• Brand strategy : The overarching strategy to boost brand identity
• Product or service overview: Comprehensive details about the products and services and their unique value propositions
• Specific budget goals: Detailed targets per product, distribution channel, or customer service
• Sales plan: Strategies devised to drive sales in alignment with marketing efforts
• Major campaigns: Identification and outline of significant marketing campaigns
• Progress review dates: Scheduled timelines to evaluate budget status against set benchmarks

The U.S. Small Business Administration guidelines recommend allocating around 7–8% of your total gross revenue to marketing. However, revenue-based marketing budgets can be pretty one-dimensional.

Investing 8% of your revenue for marketing is only possible if your profit margins are reasonably wide. While it’s easy for established businesses, those breaking even, or worse, operating at a loss, cannot commit to this percentage.

There are a couple of other approaches for calculating your target marketing budget, such as:

• Competition-matched budgeting: You’re willing to spend as much as your competitors. This is typically the principle used for calculating digital advertising spend
• Identify your current marketing goals
• Prioritize which marketing tactics need more resources
• Monitor every allocation to avoid overspending
• Objective-based budgeting: You build a budget based on the target objective with little to no cost restrictions

6 Steps to Creating Successful Marketing Budgets

A marketing budget is a collaborative effort of your company’s finance executives, marketing teams, and program leaders. Creating an effective marketing budget is more than just people and numbers, though—it’s about outlining a path for growth and strategic action.

Here’s a quick rundown of six crucial steps for creating your marketing budget. To simplify the process, we’ve demonstrated functionalities with the ClickUp Marketing Suite to break down certain steps. 🌟

The first step to creating a marketing budget is outlining the objectives that justify it. For example, you can consider setting goals focused on:

• Increasing sales
• Accelerating lead generation
• Elevating brand awareness
• Brand repositioning

However, precision is vital. Vague weekly goals like “ increase sales ” lack clarity and direction. Here’s an exercise you can do:

• Note down your overarching business goals
• Short-term goals focus on immediate improvements, like reducing website bounce rates or pushing online advertising
• Long-term goals comprise broader achievements, such as search engine optimization or efficient marketing automation
• Establish key performance indicators (KPIs)—they’ll later help quantify specifics within the budget

Use ClickUp Goals to set up your marketing goals with measurable KPIs. Track goals weekly, monthly, quarterly, and annually, linking them directly to specific tasks or projects, fostering continuous improvement across your marketing endeavors.

Tip: If you’re struggling to etch out your marketing goals, adhere to the SMART (Specific, Measurable, Attainable, Relevant, and Time-bound) criteria for focused goal setting. The framework allows you to keep your goals realistic and doable. 

Once you know your goals, start researching your competitors’ marketing spend. To get started, ask these two questions:

• Who performs well in the industry?
• What marketing strategies and budget allocations do they employ?

Examine channels like website marketing, social media, video marketing, and PPC ads. Study competitors’ marketing tactics, message frequency, and success models. Identify similarities and differences with your own to carve your unique selling proposition.

Need a quick tool to compare? Use the ClickUp Competitive Analysis Template to map out the status of all industry leaders and competitors. It offers an interactive view, allowing flexible brand modification and positioning. You can evaluate their budget performance based on preset metrics or identify their strengths and weaknesses and craft smarter strategies.

Once you’ve got the numbers in place, you can immediately start documenting your budget using ClickUp Docs . Add nested pages, customize styling, tables, and real-time edits with your marketing colleagues to devise your proposed budget. 🧮

If you don’t want to waste time writing research reports, use ClickUp’s AI Market Research Survey Generator to get well-structured marketing documents produced within seconds.

Marketing teams must differentiate between essential expenses and unnecessary add-ons. By organizing your budget and correlating spending with outcomes, you can identify where to invest and where to cut back. 

Take PR campaigns , for instance—here, you need to focus on tools that engage your target audience effectively, which would justify the amount you spend on acquiring those tools.

Using performance data analysis, you can identify the marketing channels with the highest ROI and allocate a budget based on each channel’s impact and potential returns.

The ClickUp Priority Matrix Template simplifies the process with a 2×2 matrix based on urgency and importance. You can use color-coded sticky notes to display marketing initiatives based on the ROI they generate. For example, if your blog post campaign generates the highest ROI, you can label it as High Importance in the template.

Be very specific when you allocate the budget—keep elements like expected returns and funding schedule super transparent. However, even the most detailed budget planning cannot always guarantee your actual spending. So, what if you face a shortage of funds down the line?

Set aside a portion of your budget as a contingency fund for unexpected costs like thwarting aggressive competitor moves or capitalizing on sudden opportunities. This reserve should typically be at 10% of your total budget. It serves as a safety net and ensures flexibility in responding to unforeseen events .

You can now track your marketing budget allocations in versatile spreadsheets using ClickUp Accounting . This feature suite helps streamline financial tasks , track marketing spend, and generate reports. You can categorize your funds (like Cash Reserve or Google Ads Spend )  using Custom Fields and Tags to make tracking easier.

You can also set up ClickUp Automations to monitor when you’ve overspent and would need to make adjustments. Automations in ClickUp are no-code and customizable.

Bonus: Follow your marketing budget in action using the ClickUp Accounting Template and oversee invoices, fund status, sales records, income, and revenue projections.

After defining costs and setting up cash reserves, give your marketing budget some final touches and send it for approval. Who you send it to depends on your team hierarchy and approval network.

ClickUp has multiple communication features to help you stay in the loop or seek clarifications during approval workflows. The platform’s Chat view is a valuable tool for exchanging key information during budget approvals and special project updates. If you’re the one approving, you can also employ ClickUp Proofing to leave feedback on sections of the budget. 

Don’t just implement your budget and forget about it. Regularly reviewing your marketing plan and budget is essential to keep up with evolving business needs. 

Use analytics from your marketing software to assess ROI and adapt your budget based on market changes or campaign effectiveness. Measure KPIs for each campaign and channel to optimize budget allocation.

A smart way to monitor your marketing budget is to set up finance-related pie charts and graphs in ClickUp Dashboards . From prioritization and deprioritization to progress tracking and team performance evaluation, it’s the place to be if you want a bird’s-eye view of your projects. 📈

Monthly or quarterly, scrutinize actual spending against performance metrics, adjusting allocations in real time—the changes are immediately reflected in your Workspace.

ClickUp also makes it easy to share your updated business strategy, sales calendar, product releases, and target customer documents with your marketing team. If you want, you can request their feedback through customized ClickUp Forms .

If you end up with new budgeting optimization tasks, organize them in the platform’s Calendar view so you don’t miss any deadlines.

Creating a Marketing Budget: Common Mistakes 

Setting up your marketing budget involves numerous intricate components, leaving a lot of room for errors. Small business owners often struggle with marketing budget allocation as they cannot afford professionals to guide them.

Keep an eye out for these common budget planning mistakes. 

The market undergoes continual shifts as consumer priorities evolve. What worked effectively in one year might lose its impact in the next.

Thoroughly reassess your market budget to understand how technological advancements, political shifts, emerging social movements, and other factors have influenced consumer behavior. Timely customer insights will help you identify marketing opportunities or pull out bad investments before they lead to huge losses.

Businesses should balance investments between time-tested and emerging strategies to remain agile.

Finding the perfect marketing strategy often involves trial and error. It’s rare to find an ideal approach on the first attempt. However, don’t go overboard with experimentation. Instead of adopting random, unfocused approaches, go for some marketing initiatives that have proven to work reliably.

Still second-guessing your ideal marketing budget allocation ? The 70-20-10 rule might help you achieve a balanced framework. Here’s how it works:

• 70% of your budget goes to proven strategies that have demonstrated success
• 20% to explore new strategies 
• The remaining 10% is left for experimental approaches, allowing room for innovation and risk-taking

While there’s often considerable emphasis on acquiring new paying customers in marketing, there’s substantial value in nurturing existing ones. 

Research indicates that acquiring a new customer can cost about five times more than retaining an existing one. Additionally, studies by Bain & Company’s Frederick Reichheld show that a mere 5% increase in customer retention rates could substantially boost profits by up to 95%.

Building loyalty among your existing customer base is not only cost-effective but also fosters a stronger and more enduring customer relationship, contributing significantly to long-term success.

Analytical data facilitates informed decision-making , allowing you to take calculated risks, sometimes relying on instincts or intuition. Utilizing inaccurate or unreliable data can significantly impact your budget planning process. 

However, having copious amounts of data doesn’t automatically ensure its quality. It’s essential to employ robust data-cleaning strategies to eliminate duplicates, inaccuracies, and other forms of bad data .

Enjoy Seamless Marketing Communications and Budgeting with ClickUp

Tired of marketing budgets that fizzle instead of flourish? Crafting a comprehensive marketing budget can feel like juggling spreadsheets in a circus tent. 🤹

But with an all-in-one solution like ClickUp, brainstorming, planning, and executing is as easy as pie. Plus, its AI Assistant can help your team be more efficient over time. Sign up for free to discover more.

Questions? Comments? Visit our Help Center for support.

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How to Develop and Track a Marketing Budget

Table of Contents

Every business marketing plan should include a marketing budget – a specific amount the business will allocate to promote its goods and services. Determining a marketing budget can be a challenge, especially if you’re new to marketing investments. And marketing spending can vary wildly depending on industry, location and a business’s goals. 

A marketing budget specifies exact amounts to allocate for staff salaries, office space, equipment, marketing communications, ad design and specific marketing channels. Your budget helps you align marketing strategies with business goals and funnel money into marketing campaigns with the highest return on investment (ROI) . 

We’ll explore the steps for creating a marketing budget, what your marketing spending may look like, and how to track your marketing budget and gauge its success.

How to develop a marketing budget

Businesses typically develop marketing budgets quarterly or annually. They should be comprehensive and include all the projects your team plans to develop in the short and long term. 

Follow these four steps when setting your marketing budget. 

1. Identify your marketing goals.

Marketing aims to build a sales funnel or generate direct sales to boost gross revenue . To create an effective marketing budget, you must determine short-term and long-term marketing goals and set key performance indicators (KPIs) as part of your marketing strategy’s big picture. 

These are examples of short-term goals: 

• Decrease website bounce rate by 5%.
• Gain 10 quality comments on social media posts per week.
• Boost brand awareness by generating 100 new social media channel followers each month.

These are examples of long-term goals: 

• Get on the first page of Google for three of your main focus keywords.
• Create a sales funnel that consistently generates 20% new customers over the next three years.
• Develop a marketing automation flow with email marketing that saves your team five hours weekly.

2. Understand your target audience (buyer personas).

A buyer persona is a fictional representation of your target customer . You can have more than one buyer persona, but try for no more than five; after all, not everyone can be your target audience . 

When developing your buyer personas, get specific, and let data guide you. Here are some ways to gather data that will help you develop your buyer personas:

• Survey your current customers.
• Interview people you think may be in your target audience.
• Use Google Analytics to determine audience demographics .
• Use Facebook Insights to track user interaction with your brand.

In each buyer persona, include the following information:

• Marital status
• Approximate income
• Motivations and goals
• Sources they visit for information
• What makes their life easier?
• What keeps them up at night?
• As a bonus, come up with a fictional name and photo

3. Understand your market and competition.

Market research, particularly buyer demographics, can help you better understand your target market. 

To understand your market, gauge the following information. 

• General demographic info. Where do your customers live? What is their education level and average income?
• Outside influencing factors. What exterior forces could impact them and affect sales? For example, economic trends may shape how you plan your budget, and tech trends may prompt buyers to use different methods to shop or make payments. 
• Customers’ wants and needs. Another way to understand your market is to gauge their wants and needs. What are the top needs your company can fulfill in the market? Consider customers’ needs in the broader sense. For instance, your target market’s needs may include feeling safer in their neighborhoods or saving money.

Market budgeting also involves researching the competition. Consider the following questions: 

• Who is performing well? 
• What types of ads and marketing strategies are they currently using? 
• How much are they budgeting for their marketing department? 

Industry type can impact marketing spend. According to the February 2022 CMO Survey , B2B product companies typically spend an average of 9.4% of their revenue on marketing; the corresponding figure for B2B service companies is 10%. B2C product companies spend an average of 14.2% of their revenue on marketing; the corresponding B2C services figure is 8.7%.

4. Choose your marketing channels.

To generate the best return on the revenue you spend, market where your buyer personas go. The marketing channels you should consider break down into four primary categories: 

• Digital marketing. Digital marketing channels include social media marketing, online content marketing, automated or manual email marketing, online advertising with pay-per-click ads or social media ads (paid media), and search engine optimization.
• Inbound marketing. Some inbound marketing channels overlap with digital marketing, including SEO, business blogs , videos on YouTube and Vimeo, e-books, and other elements of your content strategy .
• Outbound marketing. Outbound marketing can be challenging to track, so combining it with inbound marketing is helpful. The most traceable form of outbound marketing is email marketing. Other types of outbound marketing include TV and radio advertisements, direct mail marketing , press releases, trade shows, and promo products.
• Brand awareness campaigns. These channels can also overlap with other channels and may include social media marketing and advertising, content marketing, public relations, and video marketing and advertising.

How much should you calculate for a marketing budget?

Companies use different strategies to develop marketing budgets, including the following:

• Revenue-based. One way to determine your marketing budget is to review your annual revenue sheets and set aside a percentage. Some businesses might allocate between 6.5% and 8.5% for marketing purposes. The percentage may be higher for newer business ventures. Businesses under five years old should consider spending 10% to 12% on marketing.
• Competition-matched. Based on previous research, you could also budget based on the amount your competition is spending.
• Top-down. A top-down budget plan means there isn’t a set calculation on how much you should spend for the quarter or year. Instead, management determines a figure and asks the marketing department to stay within those parameters.
• Goal-driven. With goal-driven marketing, management and marketing determine goals first and then set a budget to achieve them. For instance, one goal may be to gain X amount of followers on social media. Another goal may be to achieve X amount of conversions online through your business website . Assign a monetary value to each goal. For example, you could assign social media follows as being worth 50 cents per user, so gaining 100 new followers would represent $50.

Common marketing budget mistakes

Because there are so many moving parts involved in setting up your marketing budget, there are more opportunities to make mistakes. Any misstep in the process can lead to less effective marketing overall and potential financial challenges for your business. 

Below are a few typical budget-planning mistakes. Watch out for them as you create your budget. 

• Putting less money toward effective methods. Companies often drive funding to their longtime favorite processes, even when a newer marketing channel proves effective. The notion that a successful marketing method will always be effective is logical but misguided. The consumer market shifts frequently; what worked one day may not work the next. Instead, consistently invest in new and old successful tactics. This way, you can keep pace with changing market conditions through higher-quality automation, personalization and other upgrades.
• Not correcting bad data. Taking a shot in the dark on a marketing method that works with your target audience can present a financial risk. You need to assess your consumer base’s data to create corresponding marketing campaigns, but bad data can lead to less effective marketing overall. Go through your analytics and remove any inconsistencies or outliers before they impact your budget.
• Discounting current customers. When you’re creating a marketing campaign, you might feel pressure to cast an increasingly wider net to move more consumers through the sales funnel. But adding new customers often costs more than it does to keep your current ones. Only so many people will reach the end of your sales funnel, and they often have many reasons why they did. Focus on retaining these people for a larger and more consistent profit boost.
• Using the previous year’s marketing budget. The market changes year to year as consumer priorities shift, so a marketing budget that worked one year will likely be less effective the next. The budget-creation process should always include a reexamination of company goals and a new analysis of the current market. Finding out how new technologies, political climates, social movements, and other factors have affected consumers can even provide new marketing opportunities. 

How much do small businesses spend on advertising and marketing?

According to the U.S. Small Business Administration, a typical marketing spending recommendation for profitable businesses making less than $5 million in sales annually is about 8% of the gross revenue.

However, the exact amount small businesses spend on advertising and marketing varies widely. To give you a better idea of what to spend, the following business owners shared their budget amounts and where those budgets go.

Dennis Vu, CEO and co-founder of Ringblaze

“We spend $3,000 per month on marketing. We’re a startup in the SaaS industry, business phone app niche. We sell a business phone app that lets our customers easily open up new channels for their customers to call them,” said David Vu, CEO and co-founder of Ringblaze.

“When it comes to the money we invest in marketing, most of it goes on SEO and content marketing,” he added. “We realize that it’s a long game, but so far, it’s made a lot of sense in the amount of exposure and the number of leads we generated.”

In two months, Vu’s company doubled its organic traffic, tripled its website’s domain authority, generated 10 to 20 backlinks to its website, and increased the number of leads it generates by around 30%.

“We may have just gotten lucky, but the results we got from digital marketing are excellent,” Vu said. “Our doubts initially were that the agency we hired would not deliver at all, especially for a small budget like this one. Most companies that I know spend five times this amount monthly on marketing at the least, so we are pretty happy with the results we got.”

Dave Madrid, solopreneur developer

“I had hoped to bootstrap marketing, and my preference is still to do that where possible, as this fits with the ethos of my business,” said Dave Madrid, a self-employed developer. “This means that my external marketing spend is currently very small, but growing month-on-month. External spend has gone on location-targeted Facebook ads, Google ads, off-page SEO activities and link-building.”

Madrid added that he is increasing his internal investment in blogging, developing a social media following, engaging in local and startup Facebook groups, conducting polls, and asking questions to generate engagement.

“Up to now, I have found Facebook ads to be an effective approach to generate views (more so than Google ads), although engagement has been achieved best through Facebook groups, posting about our blog, [and] engaging with others’ questions.”

The budget for Madrid’s external marketing activities has increased from what he says was an unrealistic $1,000 per year to $5,000 per year. He continues to evaluate whether or not his budget needs to increase. 

Madrid concluded that 15% or more is a reasonable amount of gross revenue for new businesses to put toward advertising and marketing. Established businesses can reduce that substantially; even as little as 5% of gross revenue could work. You can always start small and work your way up.

Kristin Marquet, creative director and owner of Marquet Media

Kristin Marquet said her company spends about $30,000 a year on marketing campaigns, tools and outsourcing, which equates to about $7,500 a quarter.

Behind that marketing budget are two brands: Marquet Media – a branding and design consultancy that offers branding, web design and PR services – and Fem Founder, a media company that publishes content on entrepreneurship and marketing for female entrepreneurs . 

Marquet also sells digital products on the website out of New York City, where she is based. Pinterest is one of her primary marketing channels. It helps her build email lists for her digital products and courses.

Marquet is clear on her profit margins, as all marketers should be. “For every dollar invested in promoted pins [on Pinterest], I generate about $1.30 in revenue. I also invest in email marketing software, which is about $600 a month. I use Leadpages for landing page software to capture leads, which is about $30 a month, and social media automation, which is about $79 a month.”

Like many entrepreneurs and small business owners , Marquet was unsure of marketing ROI when she started her businesses, so she was a little nervous about allocating any budget. She started off with a $500 budget and tested Google and Facebook ads, but she learned those platforms are not where her target customers spend the most time; they are very active on Pinterest instead.

Based on her experience, Marquet thinks any business should allocate at least 10% of its gross revenue for marketing and advertising, but 12% is best if it can invest this much. 

How to track your marketing budget

Campaign tracking and lead tracking are integral to gauging your marketing efforts’ success. 

• Campaign tracking. Create one line item per campaign that notes the campaign name and invested amount. Include the salaries of involved employees and the total time it took to complete each campaign. Note where campaign and time adjustments are necessary.
• Lead tracking. Create one line item per lead with the date, lead source, campaign, assigned sales rep, notes, status and revenue generated.

When adjusting your marketing budget and tweaking a strategy, go slowly, adjusting one key variable at a time. Something as simple as changing a photo on a Facebook ad and increasing its budget by just a few dollars a day could make a huge difference.

Marketing budget templates

For extra assistance, a marketing budget template can be useful. Here are some resources that offer marketing budget templates:

• Microsoft Office

Get the most out of your marketing budget

Effective marketing is vital to your company’s success. It’s how you attract new customers and keep current ones returning for more. Of course, there are usually only so many resources you can pour into your marketing efforts. Creating a budget can push your spending toward the most successful channels – and keep enough money available for all your other needs.

Isaiah Atkins contributed to the reporting and writing in this article. Some source interviews were conducted for a previous version of this article.

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How to optimize your marketing budget: Do more with less

Written by by Hibathu Naseer

Published on  September 18, 2023

Reading time  10 minutes

With an economic downturn looming, it’s not surprising around 75% of CMOs report being asked to do more with less in a Gartner survey. Marketers are finding it increasingly difficult to set the right budget, optimize it and keep the leads flowing.

Managing social media and other marketing channels in this economy can be challenging. You’ll need a plan to address top budget concerns to provide clarity and control over every dollar spent. It will help prioritize vital areas, avoid overspending and adapt to unforeseen challenges.

In this blog, we’ll cover:

How to budget for your marketing needs

• Optimizing your marketing budget: Best practices

Marketing budget breakdown

Sample marketing budget.

To set a marketing budget, you will need to look at past records, do thorough market research and analyze your team’s needs. Let’s look at these steps in detail.

Take a look at past results

The phrase “Yesterday’s lessons, tomorrow’s innovations” holds true when setting marketing budgets during a recession. It’s all about knowing what’s working, and focusing in on activities and core channels that are delivering.

See where your dollars had the most impact in the previous year—the campaigns that brought the biggest return on ad spend (ROAS), conversion rates or lead sources. For example, if you got X number of leads from influencer marketing in the previous year, you can propose an X+10% increase in budget for the same activity this year.

Create internal benchmarks by platform and across all media channels to identify areas of investment that are not worth continuing. If you didn’t have metrics in place last year, now is the perfect time to implement them based on your company’s overall goals.

Do your research

You need to be aware of the market conditions to allocate the right marketing budget. Research how the market has changed since last year: Do you have the same competitors? What is your current brand perception? How has AI impacted the market?

Look for industry benchmarks to gain insights into what your competitors are spending on marketing. This will give you an idea of what your marketing budget should be.

Take a look at this representation of the percentage of revenue different industries allocate to marketing per a Gartner report:

Also connect with industry peers to learn how they’re managing their budget and keep close communication with your team about the results they’re seeing from marketing spend.

Such insights will help you identify new areas in marketing where you can focus your budget or refine existing ones.

Understand your team needs

When creating your marketing budget, carefully evaluate team needs, skills and the required resources necessary to achieve your marketing goals. This is important considering skill gap is a major issue in many marketing teams. A Gartner survey reveals a majority of CMOs find their teams lack the capabilities required to deliver their marketing strategy.

Compare your team’s existing skills with the skills required to execute your marketing strategies effectively. You can either address these skill gaps by providing additional training and resources for your team or hire additional team members, freelancers, consultants or agencies to fulfill specific roles—both of which will affect your budget.

Another important factor to consider when setting budgets is your team’s bandwidth. For example, your SEO team may aim to increase domain authority through backlinks. However, they may not have the time to reach out to the many sites required to achieve this goal. So, you must set aside a budget to outsource this task to a backlinks expert.

Get the bigger picture

You now need to see the bigger picture and set priorities .

Company goals are the anchoring points of your marketing budget. Consider both long-term and immediate goals—the former to get leads quickly and the latter as a growth strategy for the future.

The market research you’ve performed will also help you develop new goals and navigate old ones. There might be significant shifts in the market that push your strategy in a certain direction or internal changes that will influence your brand marketing strategy .

Next, you’ll need to create an estimate of the costs associated with different marketing activities. Take into consideration the cost of tools, resources, employees and contractors.

Check out industry reports or consult peers to get an idea of the range you would have to spend. The final step is to submit the draft of the marketing budget to stakeholders and seek approval.

Optimizing your marketing budget: 5 best practices

To navigate the current economic situation, some brands are investing in more resources. According to The State of Social Media 2023 report, 79% of marketers expect an increase in their overall marketing budgets in the next three years.

Let’s look at some techniques you can use to audit your current marketing budget and prioritize things that move the needle the most.

1. Remove siloes within marketing and sales teams

Oftentimes, sections of the marketing teams are functioning in separate bubbles. The advertising team may not know what the content team is doing and the PR team is unaware of what the customer marketing team is up to.

Getting teams to collaborate and find synergies between different channels can save money.

For example, when the teams focus on paid campaigns and SEO collaboration, they may discover that the website is already ranking organically for an expensive target keyword and there’s no need to bid for it. A holistic paid and organic keyword strategy like this can reduce your ad spend significantly.

Also making sure marketing and sales are aligned allows you to take better advantage of your budget. Sales needs to follow up on leads and marketing should be able to provide quality leads. Both sides should define and agree on what constitutes high-quality leads and create a handoff process so time is spent on nurturing quality leads.

2. Consider revenue

Regardless of the metrics you’re reporting on—pipeline, website sessions or conversions—in the current economic situation, it’s always best to base your budgeting decisions on the actual revenue that your activities are driving.

For example, an advertiser may think that a 1:3 ROAS ratio is fantastic. But if the company’s cost of goods sold is not considered, the company could still lose money despite the good ROAS.

Similarly, look into your current strategy and determine how to adjust your marketing budget based on what’s moving the needle for actual revenue.

3. Listen to customers

If you’re implementing multiple marketing campaigns but it’s not what your customer wants, chances are you’ll experience losses.

The best way to know where to put your money is by understanding and listening to your customers. Keep up with their changing needs and desires. Get to know how they are responding to marketing efforts. This will help you allocate the needed resources and help you invest in the right channels.

According to The State of Social Media 2023 report, 58% of business leaders believe that more effectively leveraging social media data and constantly adjusting social media strategy to the evolving needs of customers will give companies a competitive advantage.

It is clear that personalization and intuitive communication are important in marketing and are valued by customers. So, make sure you listen to your customers and understand their behavior.

Consider audience research as the starting point of channeling budget and resources so you gain the best returns.

4. Consider experimentation and contingency

In an ever-evolving market, marketing teams should be able to try, test and learn. Allocating money for this purpose may be difficult since it’s less certain but it can bring you the strongest outcomes.

Using a zero-based budgeting framework lets you focus on accounting for projected costs and performance outcomes for new initiatives where there isn’t past data to reference. It also helps assess reallocating budget for new initiatives or campaigns that come up after the budget has been confirmed.

Anything new brings risk, so you’ll need to justify each expense for its potential ROI and compare that to the ROI of existing campaigns. Thus, it allows business leaders to revisit, remeasure and reevaluate their marketing strategy. Then, leaders can decide if it’s worth pursuing or to stick with what they know works.

According to The Sprout Social Index™ 2023 , 38% of consumers agree that the most memorable brands on social prioritize original content over following trending topics. And 26% agree that memorable brands take risks with their social content. This demonstrates the dynamic nature of the marketing landscape, where innovation and bold approaches are valued by customers.

Apart from this, it’s always best to have a contingency fund in place to make use of a golden opportunity that may unexpectedly come to your team.

5. Use the right technology

Including the right tech tools in every digital marketing budget is a no-brainer. More and more marketers are investing in tools and technologies to get the most out of their time and efforts.

Per The Sprout Social Index™, more than 80% of marketers say AI has already positively impacted their work, giving them more time for creativity (78%) and increased efficiency (73%).

Since one of the biggest marketing expenses is tech, you need to carefully consider new tools and maximize the value of your tech stack.

How do you make sure to spend wisely on tools?

One way is to invest in robust tools that offer multiple functionalities in one place and/or integrate with your existing tech infrastructure. This is potentially more cost-effective than paying for multiple individual tools as you maximize your budget while streamlining your workflows.

For example, Sprout Social helps you manage inboxes across social platforms, monitor and manage ratings, handle paid promotions and it integrates with other tools in your stack. Here are some of the marketing functions you can handle with Sprout:

• Marketing automation : Schedule content, funnel comments and messages into one social hub, generate shareable reports and track brand mentions.
• Reputation management : Sprout’s Social Listening capabilities detect a crisis early and enable you to identify unfamiliar trending words from customer conversations.
• Customer service : Build chatbots to handle customer support requests or direct messages to the right team. Our AI Assist functionality helps you write robust customer responses quickly.
• Business intelligence : Sprout helps you understand customer behavior and surface business-critical information from social channels with sentiment analysis.
• Powerful integrations : Integrations with other tools, like Salesforce , will enable you to access, share and manage data for 360-degree view of the customer.

You should complete regular assessments of your marketing tech stack before setting your annual marketing budget. Things might have changed and your go-to tool today may no longer fit your needs six months from now.

When crafting a comprehensive marketing budget, enterprises need to consider various categories that cover both marketing talent and technology. Here’s a breakdown of the top categories to have in your marketing budget:

Social media marketing budget

A social media marketing budget typically includes allocations for various expenses related to running effective social media campaigns and strategies. You will need to assign a budget for content creation as well as ad campaigns in case you’re looking into paid marketing.

Marketing talent: Social media managers, community managers, paid media strategists, creative designers and video editors.

Marketing technology: Social media management tool , employee advocacy tool , project management tool and graphic design tool.

Here’s an article where you can learn more about social media budgeting .

Influencer marketing budget

This budget covers the funds allocated for collaborating with influencers to promote your brand, products or services. It will depend on what the influencers charge per campaign or if you plan to pay them based on referrals.

Other factors include how you plan to manage the influencers—from contract negotiations to collaboration to tracking performance. An influencer management platform like Tagger (which was recently acquired by Sprout Social ) will help you do this more efficiently.

Marketing talent: Influencer relationship managers, content creators and creative editors.

Marketing technology: Influencer management platform and social media analytics tools.

Content marketing and SEO budget

This budget covers the funds to create high-quality content , optimize it for search engines and promote it to attract and engage your target audience across various platforms. It can also include public relations and executive communications to further support brand awareness and distribute content to wider audiences.

Marketing talent: Content strategists, SEO strategists, external communication professionals, content writers, editors and video producers.

Marketing technology: Content management system, SEO tools, AI writing assistant and website analytics tools.

Paid media budget

Your paid media budget should cover the expenses for the funds allocated specifically for setting bid strategies, ad placements and A/B testing.

Marketing Talent: Paid media marketing specialists, copywriters and graphic designers.

Marketing technology: Ad management platforms, conversion tracking tools, website analytics tool and social media analytics tool.

Customer marketing budget

This fund is for retaining and engaging existing customers, nurturing their loyalty and maximizing their lifetime value. It includes various expenses necessary to execute customer-focused marketing strategies effectively.

Marketing talent: Customer marketing manager, email marketing specialist and lifecycle marketing manager.

Marketing technology: Customer relationship management (CRM) software, email marketing platform, personalization tools and survey and feedback platforms.

By allocating resources to these essential categories and balancing marketing talent with technology investments, enterprises can create a robust and effective marketing budget that drives results across various channels.

Here’s a sample marketing budget with percentages allocated to the different categories listed above:

• Social media marketing: 20%
• Influencer marketing: 15%
• Content marketing and SEO: 30%
• Paid media: 15%
• Customer marketing: 10%
• Marketing analytics and automation tools: 3%
• Website development and maintenance: 2%

Here’s another sample marketing budget:

• Inbound content marketing: 30%
• Social Media Marketing: 20%
• Events and Sponsorships: 10%
• Influencer Marketing: 5%
• Email Marketing: 10%
• Paid advertising: 15%
• Miscellaneous (Contingency): 10%

To know more about the cost of social media management and the average amount a business should spend, here’s a detailed breakdown .

Investing in the right channels

Optimizing your marketing budget is a strategic initiative, which should be developed based on past experiences and analyzing what will work in the future. Investing in the right channels, like social media and technology will help you make the most of your marketing budget.

As you dig into the details of cost allocation, think about the ROI of social media and read our article to understand how you can optimize your marketing spend to improve your market position and propel your business forward.

• Marketing Disciplines
• Team Collaboration

How to build a marketing tech stack that scales your business

• Customer Experience

Brand trust: What it is and why it matters

• Leveling Up

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• How to Create Marketing Budget: A Quick Guide

Marketing is essential to connecting your product or service with an audience. But that process isn’t cheap. There are ad buys, graphic work and copywriting to name only a few things. A marketing budget is how marketers know how much they can spend on their campaign.

Understanding how to create a marketing budget is a key element of any marketing plan. Once you’ve made the marketing budget, you have to track it to ensure you stay within your marketing budget. We’ll explain how to do that and even throw in a free marketing budget template to help you get started.

What Is a Marketing Budget?

A marketing budget is an outline of the costs that a company will spend to market its product or service. The marketing budget covers a finite period of time, the length of which can be anywhere between a quarter to a year.

The marketing budget includes all expenses related to the advertising campaign. These can include paid advertising, sponsored web content, additional marketing staff, registering a domain and building a dedicated website, print and billboard advertising, TV ads and much more.

Budgeting is a crucial part of any marketing plan; you need to allocate your resources properly to meet various marketing strategies that your company sets. It’s a complicated job that’s simplified through project management software.

ProjectManager is online project management software that helps you plan and track your marketing budget. Our Gantt chart helps you organize your tasks, resources and marketing costs. Once you have a marketing plan and set the baseline, you can track the planned costs versus actual costs in real time. Keep to your marketing budget—get started with ProjectManager today for free.

How to Create a Marketing Budget

Creating a marketing budget is an essential part of planning your marketing campaign. Without the funds, your efforts will fall short. Below are the steps you should take when building a marketing budget for one or more campaigns over the quarter or year.

1. Set Marketing Goals & Objectives

Your goals and objectives should be SMART . That’s an acronym for specific, measurable, attainable, relevant and time-bound. For a marketing budget, you need to think about your sales funnel and devise short- and long-term goals while setting key performance indicators (KPIs) to track your performance .

2. Conduct Market Research

You don’t want to go into the marketplace without a clear picture of the market . You need to conduct market research to understand your target audience. That includes demographics, customer needs and so forth. But don’t neglect the competition as they’re vying for the same customers as you are. Identify the competition and list what you have in common with them and how you can differentiate yourself.

3. Develop Your Marketing Campaign

The budget depends on the concept you’ve chosen to deliver the message about your product or service. That message must align with the overall strategy of your company. Once you have made these decisions, the related costs will become clear, such as ad materials, graphic design, art or photography and so forth.

4. Choose Marketing Channels

Your message will be most effective on specific channels depending on the target audience you’re trying to reach. This requires some research to determine if your audience is swayed by social, email or content marketing , just to name a few.

5. Estimate Marketing Costs

A marketing budget is a forecast of how much you think you’ll spend. But once that budget has been approved, you’ll have to stick with it, so it’s imperative that your estimates are accurate. There are many techniques to help you estimate your marketing costs, from revenue-based to competition-matched, top-down and goal-driven. You might also use a combination of these techniques.

6. Develop a Marketing Budget

Once you’ve gone over these five steps, you can begin to put together your budget with the resources and costs you’ve determined. These will have to be tied to the larger marketing plan. For example, resources will have to align with a schedule so teams have what they need when they need them. The marketing budget is part of the marketing plan and will develop together.

Marketing Budget Allocation

Marketing budget allocation is the maximum you can spend on a marketing plan. That money has to reach the target audience and provide leads, sales and other KPIs that will deliver a return on investment (ROI) for the company.

The marketing budget allocation is how much funding is designated for each expenditure line in the budget. As noted above, it’s a figure that the marketing budget cannot exceed. If you don’t put a marketing budget allocation into your marketing budget, you can end up spending more than your revenues.

A marketing budget allocation is used to estimate revenues and expenditures over a time period. Management uses this when planning and figuring out how to allocate their resources for the best results. The financial limit set by the marketing budget allocation cannot be exceeded.

The marketing budget is usually done annually, though it can be quarterly, and revenues are estimated to determine how many resources will be employed over that budgetary period. This informs the budget allocation, which is usually divided into departments and program units, which makes it easier to identify necessary resources.

Tracking Your Marketing Budget

The idea of tracking your budget is an essential part of managing the marketing initiative. You’ve spent a lot of time and effort planning the budget, but that doesn’t mean your work is done. A marketing budget, like any part of your larger marketing plan, is not chiseled in stone. It’s a living document that must be constantly reviewed and revised.

First, create a baseline or benchmark for the budget . That is, you have to capture those planned costs and expenditures so you have something to compare against when you’re executing your marketing plan. Without taking this step, you could overspend. For example, if you don’t know your photography budget and the photographer comes back with more costs, you’re going over budget.

That doesn’t mean that costs are frozen, but having a baseline means you know when you’re going over your budget and can adjust the scope of your campaign or the schedule to make up for the added funds spent in photography, as in our example.

Everyone on the marketing team is going to have money earmarked for their tasks, but the marketing manager has the final say. The team can have some anatomy, but for efficiency and transparency, there should be a centralized purchasing process in which the manager is in control.

It’s also best to have software that delivers real-time data. You don’t want to know that money was spent days ago, you need that information immediately. Having real-time data means managers can make more insightful decisions when managing their budgets.

Marketing Budget Template

While a marketing budget template isn’t going to give you real-time data and will require you to manually input all your financial information for the marketing campaign, it’s still a good start if you don’t have project management software. Our free marketing budget template for Excel is a great tool to help you manage your budget. You can break up your spending over quarters and view the year-to-date spending against your total yearly budget.

Use our free marketing budget template to organize the money you’ve allocated to marketing initiatives, whether paid advertising, sponsored web content, marketing personnel and so forth. You can use our free marketing budget template as a strategic tool when spending across your marketing channels. Use our free marketing budget template when you strategize your marketing for the year and turn creative ideas into financial realities.

ProjectManager Tracks Marketing Budgets

Unlike templates, ProjectManager is online project management software. That means our tool updates in real time and even automates workflows that you set up. We have task approval settings to ensure that nothing moves forward until it’s been reviewed for quality assurance.

Schedule Your Marketing Campaigns

While marketing managers want to use robust Gantt charts to schedule marketing campaigns, not everyone uses this tool to execute their work. Our multiple-project view means you can use what you want and all views are updated in real time. For example, a calendar view captures events that are easy to see at a glance.

Track Marketing Costs In Real Time

Of course, seeing events and activities is important, but so is tracking that work. It’s how you keep to your budget. Once you set a baseline on your marketing plan, you can view planned versus actual effort on the real-time dashboard . No setup is required. You get a high-level view of six metrics whenever you want, from costs to workload and more.

Manage Teams, Time & Resources

There are a lot of ways to spend money on a marketing campaign, and marketing managers have to stay on top of all of them. Resources can be tracked on the Gantt chart while human resources can be balanced on the workload chart . To keep track of how much time your team is spreading on their tasks, use our secure timesheets. They not only streamline payroll but help you keep track of invaluable time.

Marketing budgets fund a variety of departments and even outside vendors. You can connect sales, marketing and your art department as well as any contractors on our collaborative platform. Anyone can share files, add comments and tag other team members to get their input. It’s all done in real time so whether you’re working in the office, at home or anywhere, you’re able to work better together.

Related Content

Creating and managing a marketing budget can be challenging. That’s why we’ve created blogs, templates, guides and more to help you streamline your marketing management process.

• 10 Free Marketing Templates for Excel, Word and More
• What Is Marketing Management: An Essential Introduction
• What Is a Marketing Plan and How Do I Make One (Template Included)
• Marketing Implementation 101: How to Implement Your Marketing Plan
• How to Write a Creative Brief
• Push vs. Pull Marketing: A Quick Guide

ProjectManager is award-winning software that helps marketing departments plan, schedule and track their campaigns in real time. Plan and track time and budgets to keep your costs in control. Join teams at NASA, Siemens and Nestle who use our software to save money. Get started with ProjectManager today for free.

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How to Create a Marketing Budget (+ Free Template)

A marketing budget is one of the most essential planning tools you can make for your business. I share how to create one plus a free marketing budget template you can download.

Why is a marketing budget so crucial?

The bottom line‌, or your return on investment (ROI). By allocating resources wisely and measuring the impact of your marketing efforts, you ensure every dollar spent contributes to the growth of your business.

Click here to download a free marketing budget template .

But beyond the financials, your marketing budget helps you prioritize marketing initiatives and identify areas for improvement.

In this article, I’ll guide you through the steps to create a comprehensive and usable budget. I’ll also share how to use the attached free marketing budget template to make the budget allocation process easier.

So, let's dive in and make every marketing dollar count!

What Does a Marketing Budget Cover?

The marketing budget covers how you intend to allocate your financial resources between marketing projects and channels over some time, typically a quarter or a year.

How much are you going to spend on each of your marketing activities? Why's your strategy going in this direction? The budget helps you ‌answer these questions by considering marketing ROI.

This allows you to:

• Achieve your marketing goals
• Use your resources strategically and efficiently
• Avoid overspending
• Get stakeholder and management buy-in

Specifically, the marketing budget plan covers all your marketing-related costs — from marketing software and ad spending to content creation, new hires, and contractors.

Creating a marketing budget involves mapping all your marketing initiatives and their budget allocation in line with the expected ROI. This is one of the trickiest parts of building a budget.

There’s no magic marketing formula to help you split your budget. It’s more about making strategic decisions based on past performance, current resources, and industry trends. And this is what I’ll aim to help you figure out.

How Much Should Your Marketing Budget Be?

You can determine your marketing budget based on industry benchmarks, historical performance, marketing goals, and business growth stages.

In general, many companies calculate their marketing budget as a percentage of revenue. The table below shows the  percentage of revenue  companies in different industries spend on their marketing budget.

Recent stats show that companies in 2023 are allocating 9.1% of total revenue to marketing activities on average (Gartner's CMO's Guide to Crafting a Marketing Budget ). It’s worth noting that this is a decrease from last year — companies in 2022 were allocating 9.5% of their revenue to the marketing budget. However, since 2016, the percentage has kept going down.

Another survey also shows that 42.3% of companies (The CMO Survey, 2022) are decreasing marketing spending. This might seem like an invitation to lower your budget in line with your competitors. However, before making such decisions, consider balancing your short-term gains with your long-term goals.

And if you are experiencing budget cuts, know that 75% of CMOs (Gartner's CMO's Guide to Crafting a Marketing Budget ) face the challenge of doing more with less. This requires looking at the budget with a more strategic and creative eye.

How to Create a Marketing Budget

Alright, now let’s get into the practical stuff.

1. Review Your Past Performance

Start by reviewing your past marketing performance in relation to the assigned budget.

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Lay out all your marketing costs.

Look at how much you spent the previous year on your marketing efforts. Was it more than you had planned? Less? Why?

Check all your common marketing cost categories. It helps to put a concrete value next to each category. Some common spending categories are:

• Marketing technologies, from your keyword research tool to your video editing software
• Advertising costs, including all digital advertising activities (i.e., Meta advertising and Google Ads) and traditional advertising campaigns
• Employee salaries and contractors, plus any freelancer help you might need
• Marketing training, such as team training, courses, and conferences

Once you group all your marketing expenses into different categories, write how much you’ve spent on each category in total.

Now that you know how much you’ve spent on different areas of marketing, you can evaluate the effectiveness of your spending.

• First, review the projected vs. the actual spending. Did you go over or under budget? Then, look at key metrics like ROI, conversion rates, customer acquisition costs (CACs), and revenue. How well did you hit the previous period’s objectives?

2. The numbers don’t tell you the whole story. Dig a bit deeper beyond numbers to look at  customer journey analytics . Ask the following questions:

• Which parts of the journey are you serving well? How are you achieving that?
• Which are your most successful initiatives? Identify the initiatives that are performing well alongside their ROI.
• Which journey areas need improvement or more attention?
• Which parts of the customer journey bring the highest return?

These questions will help you evaluate your budget effectiveness and performance from a more customer-centric perspective.

So, let’s say the influencer marketing campaigns you experimented with for the first time last quarter were highly successful and brought you a ton of awareness regarding website visitors and social media followers.

How does this increased awareness translate into actual revenue? You might discover that while influencer campaigns are helping you excel in the awareness stage of the buyer journey, which is not translating very well into sales.

This might mean that you might collaborate with the wrong influencers or might need to change your campaign messaging or targeting. On the contrary, it might show you that the increased awareness also translates into better sales. So you know to continue investing in that marketing channel and even improve your allocation this quarter.

The conclusions you draw from this step will help you move forward with the next one.

2. Establish Your Marketing Goals and Objectives

Everything you do should align with your business and marketing objectives. Is the business heading in a new direction or entering a new market? Are you launching a new product or going through a rebrand?

In which areas of the customer journey do you need to focus more to achieve your goals? Do you need to attract more leads, increase your conversion rate, or lower your CAC?

These are all factors you should consider when setting your budget. If you’ve built your marketing strategy, you might have already established your goals and objectives for the next period. So, simply revisit those.

One thing I’d recommend you do in this step is to set SMART goals. This means setting Specific, Measurable, Actionable, Relevant, and Time-bound goals. These goals make it easier to calculate your budget properly.

An example of a SMART goal could be to increase social media engagement by 20% in the next three months. With a SMART goal, your team can develop a well-defined plan to achieve it. This allows you to allocate the needed budget better.

3. Allocate Your Budget

Taking all the above into consideration, in this step, you’ll decide on your budget allocation.

You can allocate your budget in a few ways, such as across the customer journey, marketing channels, initiatives, or other common categories.

In this stage, you’ll need to make a few decisions, which I’ll walk you through below.

Across the customer journey

One way to split your budget is to look at it from the customer's viewpoint. Many companies decide to go this route. As we can see from the graphic below, companies spend around a quarter of the budget on each journey stage, with the awareness stage taking the lead.

This shows that CMOs allocate slightly more to awareness-stage initiatives — and slightly less to loyalty and advocacy programs. Also, in the middle of the funnel, the consideration and conversion stages take the biggest budget chunk.

Look at your own customer journey insights. Which stages are bringing the highest ROI, and which ones are underperforming? Are you introducing new initiatives or marketing campaigns in any of them? For instance, if you’re planning to invest in influencer collaborations in the next quarter to increase your brand awareness (SMART goal), it might make sense to allocate a bit more of the budget in that area.

Marketing channels, platforms, and campaigns

Another way to look at budget allocation is through your marketing channels, platforms, and campaigns. Consult your marketing planning software on this. Look at your marketing categories and put an estimated cost next to each activity.

The figure below shows how CMOs allocate their  digital marketing budget  this way.

Different forms of online advertising take the top spots on the chart, with the highest share of the budget.

Also, it’s worth taking a closer look at social media channels. And ask the same question we’ve been asking throughout this process: Which ones have the highest marketing ROI?

Regarding social channels, Instagram and Facebook are the top two platforms with the highest ROI (HubSpot's 2023 Social Media trend Report ).

Another way to look at it is through the famous 70-20-10 rule. The rule suggests dividing the marketing budget into three main categories:

• 70% on core marketing activities: well-established strategies and channels that show positive results, e.g., advertising on established channels, running email campaigns, and investing in search
• 20% on innovation and growth: trying new marketing initiatives and exploring innovative approaches; e.g., experimenting with emerging social media platforms, piloting new advertising formats or creative concepts
• 10% on experimentation: discover new opportunities by testing out new ideas

The percentages are, of course, a guideline. They can look different depending on your business. If your business is going through a rebranding and innovating phase, you can focus a more significant share of your budget on the innovation and growth bracket.

Tip: Don’t ignore your offline marketing efforts when calculating your budget. Consider the budget you’ll need for activities like trade shows and events.

Hiring and retaining the right people should be one of the key priorities of every marketing department. Labor costs account for 24.6% of the marketing budget in companies (Gartner's CMO's Guide to Crafting a Marketing Budget ). There's fierce competition out there to hire and retain talent.

Based on the laid-out marketing initiatives, see if you’ll need to hire new in-house talent or collaborate with freelancers or agencies. Don’t forget also to consider the cost of training.

Marketing technology will probably take up a considerable part of your budget. Big organizations can expect to spend around $5,000 per month (WebFX's Martech Pricing in 2024 ) on marketing tools and platforms.

However, 75% of CMOs (Gartner's State of Marketing Budget and Strategy in 2023 ) are facing pressure to cut their MarTech spend. If this also applies to you, then it’s an excellent opportunity to look at MarTech stack examples . You’ll want to build a stack that's effective and efficient. Sometimes, you can spot tools with overlapping functionalities.

Other costs

This category accounts for additional expenses that arise throughout marketing activities. It includes incidental costs, such as event sponsorships, market research, promotional materials, training and development, or unexpected expenditures that don't fit neatly into the predefined categories.

I suggest you keep a buffer for other marketing costs. This will allow you to be flexible and responsive and cater to unforeseen opportunities and challenges. How much the buffer will be depends on several factors. You will need to keep a bigger buffer if you’re operating in a rapidly changing industry or if you are more open to experimentation and risk-taking.

It’s also good to look at how much you’ve allocated to this category in previous years. Did the actual cost align with the projected cost? Adjust accordingly.

5. Implement Tracking Mechanisms

You set up your SMART marketing objectives in step two. Now, you need to ensure you bake in a marketing measurement process into your marketing activities.

You can rely on analytics tools like Google Analytics, social media insights, or email marketing platforms to analyze the performance of your  marketing campaigns . Use tracking links (UTM parameters) for marketing channels to monitor traffic sources and campaign effectiveness. These links can be easily generated using tools like Google's Campaign URL Builder.

For online campaigns, set up conversion tracking on your website to measure actions taken by visitors, such as form submissions, purchases, or sign-ups. If you run offline campaigns or have brick-and-mortar stores, consider assigning unique promo codes to different marketing initiatives. This way, you can track the number of redemptions from each campaign.

Keep track of your real spending vs. your projected spend. Use analytics tools to measure your performance and translate everything into numbers — ROI and your other KPIs. Keep track of historical data to identify trends, seasonality, or patterns in your marketing performance. This can help you make more informed decisions in the future.

Establish a routine for reviewing your marketing data and KPIs regularly. Regular budget check-ups will help keep you on track and focused on your goals. Moreover, this way, you can also adjust the budget when needed.

Common Pitfalls to Avoid When Creating Your Marketing Budget

When creating your marketing budget, it's essential to be mindful of common pitfalls that can hinder the success of your marketing efforts. Here are some pitfalls to avoid:

• Insufficient research and planning: Skipping the research phase can lead to inaccurate budget allocations and ineffective marketing strategies. Before finalizing your budget, understand your target audience, industry trends, and competitors.
• Overestimating returns: Avoid setting unrealistic expectations for the returns on your marketing investments. Be conservative and realistic when projecting outcomes to avoid disappointment.
• Underestimating costs: Be thorough in estimating the costs of your marketing activities. Account for all expenses, including creative production, advertising spend, tools, and personnel.
• Ignoring past performance data: Failing to analyze past marketing performance can lead to repeating ineffective strategies and wasting resources. Review historical data to identify what worked and what didn't.
• Focusing on short-term goals only: While short-term goals are important, don't neglect long-term marketing strategies that build brand loyalty and sustainable growth.
• Failure to track and measure results: Not implementing tracking mechanisms can make it difficult to gauge the effectiveness of your marketing budget.
• Lack of flexibility: Market conditions and consumer behaviors can change, so be prepared to adjust your marketing budget and strategies accordingly.

How to Use a Marketing Budget Template

A marketing budget template is a pre-designed document or spreadsheet that helps you plan, organize, and track your marketing expenses.

It serves as a structured framework to outline the marketing activities and associated costs for a specific period, typically a quarter or year.

With a template, you can maintain a consistent format and structure across different budgeting periods , making comparing and analyzing historical data easier. Yet, it allows you enough flexibility:

• To adapt and adjust as needed
• To modify your marketing budget in response to changing market conditions or new opportunities.

As you execute marketing campaigns, you can regularly update the budgeting template with actual expenses to compare against the planned budget.

Using a pre-designed template saves you time and effort; you don't have to create a budget from scratch. Using a pre-designed template allows you to skip the tedious process of formatting and structuring the budget.

The template provides a ready-made framework , allowing you to concentrate on setting marketing objectives, analyzing data, and making strategic decisions.

You can see the template as a planning tool that helps you think strategically regarding your budget. Remember that creating your budget is a process; it’s not simply about filling in the blanks.

There are different types of marketing budget templates out there.

• You can use master overview budget templates to have a high-level view of your budget or a more specific one.
• An activity-specific marketing budget template allows you to go into more detail about the costs of activities like a new product launch or website redesign.
• A channel-specific template breaks down the cost information of your different marketing channels.

You can find various marketing budget templates online or create one from scratch using spreadsheet software like Microsoft Excel or Google Sheets. Also, I've added a link to the free and customizable marketing budget template below.

Free Marketing Budget Template (Excel)

As promised, here’s a free marketing budget template you can copy, edit, and download. Use this template to organize your marketing budget data so it becomes accessible as a snapshot.

Access Your Free Marketing Budget Template Here

The template is comprised of two parts. In the first part, you can fill in your 70-20-10 budget split. Even if you don’t typically use this type of split, it’s a good exercise to force you into thinking about how innovative you’re being.

So, let’s say you have a total marketing budget of $250,000 to allocate. According to the 70-20-10 split, 70% of your budget, which is $175,000, goes to your core marketing activities, $50,000 into innovation & growth activities, and $25,000 into marketing experimentations.

If you don’t have this split already figured out, feel free to fill in this part last. Filling in the next part will help you with this one.

The 70-20-10 split is not set in stone. If you’re launching a new innovative product, it might make sense to put more money into innovation, growth, and experimentation efforts. So, in this case, it might look more like 50-30-20.

The second part of the template has a breakdown of common marketing cost categories. The categories in the template are marketing technologies, marketing research, training costs, advertising costs, and the budget that’ll go into salaries and paying freelancers. These are the big budget buckets; you can and should change the categories to fit your budget split.

The template is fully customizable. But let’s say you have a total marketing budget of $250,000. Here, you can track what percentage of your total budget you are allocating to each category and the actual money sum.

Use the template to organize your marketing budget. Customize it as needed. Above all, the template can also serve as a tool to help you with the budget allocation process.

At the end of the year, you can use the template to compare your allocated spend with the actual budget spend.

You can also use it to compare each year’s budgets.

Put Your Marketing Budget Into Practice

Now, it's time to put your newfound knowledge into action.

Leverage the power of the marketing budget templates provided in this article. These templates offer a convenient and structured approach to organizing your expenses, tracking your activities, and ensuring efficient allocation of resources. Customize them to align with your specific business goals and industry needs.

And remember, a well-crafted marketing budget isn't a static document but a dynamic tool that requires continuous monitoring and adaptation. As you execute your budget, maintain agility and flexibility. Regularly evaluate the performance of your marketing initiatives, measure their impact, and make data-driven adjustments as needed.

And if you want more insights like this, then go ahead and sign up for our newsletter for marketing leaders like yourself right away.

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Home Marketing Marketing Budget: The Complete Guide

Marketing Budget: The Complete Guide

You know you need to get your brand’s message out there.

You even have some ideas for how to do it.

But how do you know which ideas are the best ideas?

And how much should you even spend?

It sounds like you need a marketing budget .

What’s in This Guide?

This guide covers everything you need to put together an effective marketing budget to ensure your company’s sustained growth:

• Why is it important to spend on marketing?
• What is a marketing budget?
• Why is a marketing budget important?
• Aligning your marketing budget with your business goals
• Brand vs product-specific marketing costs
• How to calculate your marketing budget
• How to create your marketing budget
• Final considerations for your marketing budget

Let’s dive in.

Why is it Important to Spend on Marketing?

Marketing is essential to build brand awareness and increase company revenue. Without investing in marketing, you’re relying on grassroots word of mouth to grow your brand, which, while possible, can take a very long time.

Plus, chances are your competitors are investing in their marketing efforts. If you aren’t at least keeping up with them, you’re losing both market share and time, as it’ll be harder to reclaim that market share later on.

What is a Marketing Budget?

A marketing budget is the total money allocated to growth and promotion-related efforts over a defined period, such as one month, one quarter, or one year. These efforts can include the following:

• Website design and development
• PPC ad campaigns
• Social media campaigns
• Email marketing campaigns
• Content creation for content marketing campaigns
• Backlink building
• Print, TV, radio, direct mail and other traditional campaign channels
• Employees and contractors working on marketing-related efforts
• Tools and software used for marketing-related efforts

The size and complexity of your marketing budget will vary by the size and complexity of your business.

Small businesses may have simpler marketing budgets with just a handful of employees or contractors creating a few blog posts for a content marketing campaign and promoting those posts with basic PPC and social media ads.

Large businesses may have much more complex marketing budgets spanning multiple departments or divisions, each with different department-specific business goals that tie back to your broader business’ growth targets.

Why is a Marketing Budget Important?

Having a marketing budget is hugely important for several reasons.

1. You know exactly how much you can spend

If you don’t have a budget, how do you or your employees know how much to spend?

Let’s say you sell a subscription-based product where the average lifetime value of one customer is $2,000. You tell your marketing team to generate more customers, but you don’t tell them how much to spend. Come month-end, your team tells you they signed up 100 new customers worth $200,000 to your business, and it only cost $100,000.

That’s awesome, except each customer only generates $500 in revenue in their first month, so you just spent $100,000 to generate $50,000 in Month 1 revenue, and now you can’t make payroll next week.

2. You can properly size your marketing spend

As a corollary to the above, having a marketing budget lets you properly size that budget to optimise for your business’ goals. That way, you can find the sweet spot where you’re growing at the right pace while remaining solvent.

If your budget is too small, you may fall short of growth targets and/or lose market share to competitors.

If your budget is too big, you may have to cut back elsewhere to avoid going under.

3. You’re forced to prioritise your marketing efforts

Between PPC ad campaigns, social media ads, paid sponsorships and promotions, traditional print ads and other strategies, there are a lot of different ways you can spend to grow your brand.

But if you know you only have $5,000 per month to invest in a single channel, you’re forced to prioritise one channel above all others. A tool like   TrueNorth  can help you make that decision.

Aligning your Marketing Budget with your Business Goals

Your marketing team is hard at work spending their budgeted allocation to build your company’s brand and generate new customers.

But what if that isn’t what they’re doing?

Or, more specifically, what if that isn’t what they’re doing directly ?

Think about your company’s sales funnel for a second. Yours probably looks something like this:

Now think about what your marketing team is doing and where in the funnel they’re operating.

They should be trying to generate as many customers as possible, but are they instead thinking in terms of qualified leads, traffic, or impressions?

Let’s look at two basic scenarios to illustrate this point. In both scenarios, your company is promoting your awesome email marketing course, which you sell for $1,200.

In Scenario A, your marketing team is running a PPC ad campaign to maximise traffic by targeting keywords like “why use email marketing” at $10 cost per click. They have $15,000 to spend and generate 1,500 visits to their target page, which leads to 15 new customers (1% conversion rate) with $1,200 revenue per customer.

In total, they spent $15,000 and generated $18,000 in revenue for a 20% ROI.

In Scenario B, your marketing team is running a PPC ad campaign to maximise customer conversions by targeting buyer-focused keywords like “best email marketing course” at $20 cost per click. They have $15,000 to spend and generate just 750 visits to their target page, but those 750 visits turn into 25 new customers (3.3% conversion rate) with the same $1,200 revenue per customer.

In total, they spent $15,000 and generated $30,000 in revenue for a 100% ROI.

The marketing team in Scenario A was able to generate twice as much traffic, but the marketing team in Scenario B was able to generate much more revenue for the same ad spend because they were targeting customers further down in their sales funnel.

This doesn’t mean you should always target customers already in the buying phase of their journey. Maybe targeting customers at the top-level awareness stage of the sales funnel gives you the best ROI because they’re less expensive to acquire and your email marketing efforts are convincing.

To make the most of your marketing budget and generate the highest possible ROI, your marketing team must think in terms of your business’ goals.

Brand vs Product-Specific Marketing Costs

At any given time, your company is marketing itself at two different levels:

• General brand awareness and visibility
• Product-specific promotion and lead generation

These two types of marketing are complementary, and an effective marketing budget considers both.

1. General brand awareness and visibility

Spend some of your marketing efforts on general brand awareness. If your company sells B2B training courses, like the email marketing course example above, you want to spend money promoting your brand’s overall expertise and authority. There are a ton of different forms this level of marketing can take:

• Sponsorships
• Guest blogging or podcast appearances
• Traditional TV and print ads
• Display ads and native advertising
• Branded social media hashtag campaigns

These marketing efforts prop up your entire company, which has indirect benefits on revenue generated by your specific products.

Though not universally the case, frequently, these types of brand awareness marketing activities have fixed monthly budgets because they’re ongoing with more indirect efforts.

But just because these campaigns are more indirect and don’t directly promote specific products doesn’t mean you can’t (or shouldn’t) try to track their ROI, though it can be more difficult. Monitor referral traffic, on-site engagement and email sign-ups to measure the value of your brand awareness efforts.

2. Product-specific promotion and lead generation

One level deeper than general brand awareness is product-specific promotion. If your company sells B2B training courses, this is the money you spend promoting a specific course to generate more customers and revenue directly.

While product-specific promotional efforts can have global effects propping up your whole brand, those benefits are secondary to the primary goal of generating more customers and revenue through increased sales of the specific product being promoted.

Product-specific marketing campaigns have a different feel than general brand awareness campaigns:

• PPC ad campaigns for specific product-related keywords
• Paid influencer promotions featuring your product
• Giveaways of free product for trusted brands in your industry to review
• Content marketing campaigns with solution-focused blog posts and tutorials

These types of marketing efforts have one goal: Generate more sales of your specific product.

These types of product-specific marketing activities usually have variable budgets. That doesn’t mean you spend different amounts every month, but rather that your company’s product offerings are more dynamic than your brand itself. If your company is releasing a new or updated product, you may want to increase marketing spend for that product to generate buzz and momentum at launch. Over the following weeks or months, maybe your company has another product to promote or is releasing an update of an existing product, and you want to focus marketing spend there instead.

How to Calculate your Marketing Budget

Broadly speaking, there are two common ways to set marketing budgets:

• Benchmark budgets
• Zero-based budgets

One is significantly better than the other.

1. Benchmark budgets

Benchmark budgets are bottom-up budgets, meaning they assign spend based on a bottom-line number. Examples of benchmark budgets are the following:

• 12% of revenue
• 12% of revenue after expenses (“Profit-First” budgeting)
• Fixed budget every month, quarter, etc.

Benchmark budgets are common because they’re safe and easy, but they give little consideration to your business’ goals or growth targets.

It’s like training for a marathon by running 15 miles each week. It’s certainly better than running five miles each week, but is it enough training to finish in under four hours? I guess you’ll find out come race day.

2. Zero-based budgets

Zero-based budgets are top-down budgets, meaning they work backwards from your business goal to determine how much you need to spend.

For our marathon trainer, that means working backwards from your target finishing time to determine your average pace and the number of miles you need to run each week to improve to that pace.

This approach is more purposeful and gives you the best chance of hitting your goal.

A zero-based marketing budget begins with your TrueNorth metric ; the one metric, that if increased, will achieve your business’ goal.

Let’s revisit our email marketing course example above. Let’s say your goal is to generate $600,000 in revenue over the next 12 months. With zero-based budgeting, you work backwards from that goal:

• Your goal is to grow revenue by $600,000 in 12 months.
• At $1,200 in revenue per customer, that’s 500 new customers.
• Assuming a 50% gross profit target, that’s a target acquisition cost of $600 per customer.

Depending on the specific marketing tactics you plan to use, there are a lot of different ways to reach that $600 per customer target. Let’s go back to Scenarios A and B above.

For the marketing team in Scenario A trying to generate new customers with a PPC ad campaign targeting keywords like “why use email marketing,” they know their campaign converts leads into customers 1% of the time. If they want to hit their $600 target customer acquisition cost with a 1% conversion rate, they can’t spend more than $6 per click.

For the marketing team in Scenario B trying to generate new customers with a PPC ad campaign targeting keywords like “best email marketing course,” they know their campaign converts leads into customers 3.3% of the time. If they want to hit their $600 target customer acquisition cost with a 1% conversion rate, they can’t spend more than $20 per click.

If you don’t know which campaign ideas have the best ROI yet, I recommend using a tool like   TrueNorth  to track all of your campaign ideas and record their results in a centralised place so you can hone in on your best campaigns and grow your business faster.

How to Create your Marketing Budget

Creating your marketing budget is a little more involved than just earmarking dollars for different costs or campaigns. You’ll want to focus on these five steps:

• Determine your business’ objective and its True North metric
• Understand your sales funnel
• Quantify your operational costs
• Factor in all product-related promotional costs
• Measure and track ROI

Let’s take a more in-depth look at each.

1. Determine your business’ objective and its True North metric

Every solid marketing budget starts with the top-line business goal. What is success to your business?

Once you know what success means for your business, you can determine your True North metric; the one metric that, if increased, will achieve that goal.

This initial step is crucial because everything after it should always tie back to that objective. If your marketing plan and budgeted expenses don’t move the needle for your True North metric, should you be doing them?

2. Understand your sales funnel

Your sales funnel describes how you move visitors through the various stages of the buying process to become revenue-generating customers.

It should cost less money to generate general prospects or site visitors who are at the top of the funnel — further away from making a purchase — and haven’t become qualified leads yet.

Conversely, it should cost more to generate highly-qualified leads who are lower in the sales funnel and ready to buy.

Your goal should always be to optimise your sales funnel by putting the right campaigns, marketing materials, content, and sales pitches in front of the right visitors or leads depending upon where they are in the buying journey.

If you do this successfully, you can know two crucial pieces of information about your sales funnel:

• The cost to acquire a prospect, visitor or lead at each stage.
• The conversion rate of each stage into revenue-generating customers.

Now you can maximise your marketing budget’s performance by creating campaigns that target potential customers at the stage of the funnel with the highest ROI.

3. Quantify your operational costs

The amount you pay for each click in a CPC ad campaign is just one marketing-related cost. You may also have operational costs that are more fixed in nature that your company needs to budget for regardless of the size of your brand or product-specific campaigns:

• Employee/contractor salaries and related expenses
• Email marketing tools  and CRM software
• Website domain registration and hosting
• SEO-related tools and expenses

Whether you spend $20,000 or $200,000 on an ad campaign, you’ll have to account for these mostly-fixed expenses just to keep your marketing teams’ lights on.

4. Factor in all product-related promotional costs

When gearing up for a new product’s promotional launch, it’s easy to forget any expenses you incurred in the prior months preparing for launch.

• Market research
• Focus groups to generate customer feedback
• Testing to develop the perfect campaign messaging

All of these expenses factor into your total marketing cost even though they may not directly show up on your active campaign’s budget.

5. Measure and track ROI

Your business should always be looking to improve your marketing ROI to get a better bang for your buck. A key part of that is frequent measuring and tracking of campaign performance.

Six Sigma is a set of techniques that focus on process improvement, and an integral part of Six Sigma methodology is this process of continuous refinement and quality improvement known as the   DMAIC Process :

• Define  the True North metric and KPI that tie your marketing team’s efforts to your business’ goals.
• Measure the defined metrics while your campaign is running.
• Analyse the data generated from the measurement process.
• Improve  your campaigns by tweaking the performance of underperforming campaigns, landing pages or email copy, or look to cut underperforming campaigns altogether to focus on high-ROI activities.
• Control  this iterative improvement by documenting the process and making it part of your marketing team’s day-to-day workflow.

Final Considerations when Creating your Marketing Budget

Before you rush off to create your company’s marketing budget, there are a couple of final considerations to make:

• Your company’s marketing maturity and your True North channel
• The role of remarketing

1. Your company’s marketing maturity and your True North channel

Your marketing budget should be agile and responsive, so it can react to what is (and isn’t) working. Overall, the idea is to do more of what generates the best results and less of what doesn’t.

A key part of finding what works is identifying your True North channel; the channel that generates the best results.

There are three phases of   marketing maturity  that your marketing team can use to figure out how to allocate marketing spend across various channels:

• Phase 1 : You’re looking for your core channel, which requires investing a small amount of your budget in a wide variety of channels to see what works.
• Phase 2 : You’ve found your True North channel, which means you can focus intensely on maximising your returns until they begin to diminish.
• Phase 3 : You’ve saturated your True North channel, which means you should slowly experiment with one or two other channels to diversify your efforts.

This is all a part of DMAIC continuous improvement process and is integral to your marketing team’s sustained success in an increasingly competitive landscape.

2. The role of remarketing

Remarketing lets you customise your message to speak directly to visitors who have seen your site before. Considering   97% of people  will visit your site without making a purchase, remarketing is an important and cost-efficient way of continuing the conversation with people who are familiar with your brand or product but haven’t pulled the trigger on a purchase yet.

Earlier we talked about how important it is to put the right campaigns, marketing materials, content, and sales pitches in front of the right visitors or leads depending upon where they are in the buying journey. Remarketing is an extension of that by putting personalised, targeted content in front of specific people. Plus, CPC rates for remarketing ads cost   half as much , as regular ads, and can convert   over 50% better .

Your marketing budget includes everything your company needs to spend on promotion-related activities and should always align with your business’ goals. If your top-line goal is to increase revenue, then your marketing budget should be created from the top-down to include the resources required to hit your revenue targets.

It’s also important to focus those resources on promotional activities and marketing channels that generate the highest ROI. If you don’t know what those activities and channels are, begin by experimenting with small marketing spend across a variety of channels to identify the big winners. If you do know what those activities and channels are, focus your efforts on maximising your returns until your results begin to diminish.

Above all else, remember that your company’s marketing efforts should be agile and responsive as you react to changes in performance in constant pursuit of the highest possible ROI.

We’re currently in the process of building TrueNorth, a marketing management system that helps marketing teams create adaptable plans, prioritise campaigns, and rally their teams around the marketing plan.

If you’re interested in joining our beta, you can join here . As a Venture Harbour reader, you’ll be jumped to the front of the beta queue.

Marcus Taylor is the founder of Venture Harbour. He’s also an early-stage investor, advisor & the youngest Patron of The Prince's Trust.

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Startup Marketing Budget: How to Write an Incredible Budget for 2023

Published: December 23, 2022

When proposing potential ads at your startup, one of the first questions you’ll likely encounter is, “How much will this cost?” If you’ve prepared a killer startup marketing budget, you will be well-equipped to help executives understand and buy into your vision.

A marketing budget should detail how much you’ll spend on paid advertising, fit into your overall strategy , and prove a worthy expenditure based on revenue earned.

In a world where 82% of startups fail from cash flow problems , the stakes are higher for these new businesses. Startups often face limited resources and smaller budgets, making it difficult to stake claim to a marketing budget.

This post covers how to determine what your marketing budget should be and what it needs to include.

Table of Contents

Marketing Costs for a Startup

Startup marketing budget considerations, tips for writing a startup marketing budget, how to write a startup marketing budget.

8 Free Marketing Budget Templates

Free templates to manage your marketing spend across channels.

• Product marketing budget template
• Paid advertising budget template
• PR budget template

You're all set!

Click this link to access this resource at any time.

When your company is new, determining an initial marketing budget can be confusing. In some cases, budget decisions are top-down, inspired by competitors, or made by setting a goal.

If this isn’t the case for your startup’s operations, focus first on what will bring in the most revenue. Revenue determines what your marketing budget should be and where funds should be allocated.

Startup Marketing Budgets

Startup marketing budgets outline the money a new company intends to spend on marketing functions. Startups generally factor in key expenses in their budget, like advertising, content marketing, technology, and automation software.

The money gained from your gross revenue should fund your marketing budget. So, how much of your gross revenue will you need? The average marketing budget for startups should be 11.2% of overall revenue. This percentage gives marketers enough resources to build brand awareness and start attracting leads.

If you’re starting your budget from scratch, consider using a marketing budget template to outline your phase one marketing activities and costs.

Download Free Marketing Budget Templates

Marketing Budgets as a Percentage of Revenue

Gross revenue is your earned revenue before any deductions or wages. The estimated revenue is the number of earnings you expect to earn over a period of time. Generally, startups should spend around 11% of their revenue on marketing.

To identify your gross revenue, calculate your total number of sales/increases.

If you don't have a gross revenue estimate yet, determine how much you are projecting to make and use those numbers as benchmarks. Explore tools to help you estimate your gross revenue, like this online calculator from the Small Business Association .

Now that you understand the first step to making a budget, explore other potential needs you may have.

So, what do you need to include in your budget?

Once you have money earmarked, you can begin breaking down the costs. Think of what costs naturally occur in your day-to-day and what resources you'll need to make your marketing happen.

You can put this information in a spreadsheet or template, like these free marketing offerings from HubSpot. There are no real rules with budget design, as long as it's comprehensible and detailed enough to be useful.

Remember to consider the following expenses, such as:

• Technology. When you are creating campaigns, factor in the technology you need to use, such as software to build a product page or manage a drip program . There are lots of marketing tools at different price points (and even free software), so be sure to write out what software you’ll need to buy. Check out this blog to determine which products fit your budget.
• Research. If you haven't yet discovered your target audience, you may need to invest in market research. Read the section “How to Write a Startup Marketing Budget” below for more info on market research.
• Automation. Services that automate marketing processes can make your life much easier. They can also be advantageous to startups that don't have the resources to spend money on extra hands to complete projects.
• Production. If you need content pieces, product or advertisement videos, or pictures, you will want to budget for these items as well. Instead of paying for multiple different services, you could hire freelancers to fill these roles.
• Paid advertising. Are you planning to run ads on TV, radio, or online? This is the category where you factor in those costs. It’s easy for paid advertising to add up, with some startups spending as much as 20% of their yearly budget on advertising alone. Remember, you can estimate the cost of paid ads. Take a look at our advertising guide to explore prices on anything from PPC ads to social media ads.
• Branding. Assets that build a first impression directly impact your branding. This might include business cards, billboards, swag, and signs.
• Content marketing. Decide how much you're going to allocate to deliverable content. Consider automation services, like HubSpot or Sprout Social , and content ideas you can produce organically for free.
• Traditional advertising. If applicable to your business, make traditional advertising a line item. Paid advertising usually occurs online, but traditional advertising refers to advertisements such as print and billboards.
• New employees. If you plan on growing your team with full-time or part-time staff, you will likely need to include their costs in your marketing budget.
• Unexpected costs. Expect the unexpected when figuring out your budget. Plan for devices to break or campaigns to take longer than you think they will, generating higher costs.

Working from your business goals helps you make guided budgeting decisions. For example, if your company’s goal is to increase brand awareness, you'll probably want to devote most of your budget to branding, content marketing, and paid advertising.

Remember that you can play around with free methods for most of these costs. For example, if you are certain that automated software will help your startup, explore free trials or free services that you can use to determine what’s worth the cost.

Before writing your startup marketing budget, consider the following tips.

1. Check that investments are worthwhile.

Startups have limited resources and need quick wins. Your first goal should always be to get leads for sales. Before committing to an expenditure, ask yourself, “How does this empower sales?” If the answer isn’t obvious, it’s likely not worth the money.

2. Do competitor research.

Check out your main competitors’ websites and blogs. What articles are they writing about? What keywords are they targeting? And, ultimately, how can you improve upon their strategy?

Remember that SEO is a long game, and you likely won’t see immediate wins. However, you should optimize your articles from the beginning to create the right SEO foundation.

3. Understand your customer’s journey.

There’s a reason why your customers chose you. Understanding their buyers’ journeys is valuable information. This knowledge can help you determine which channels are effective and worth budgeting for.

4. Prepare to report on your ROI (return on investment).

You will be accountable for how your marketing budget is spent. Make sure you keep track of the leads you gather and the revenue that can be attributed to marketing.

When you need to report your ROI at the end of the year, you’ll already have data at your fingertips.

5. Review your marketing budget yearly.

Between inflation and economic changes, your budget will almost certainly need an annual review.

In fact, 48% of marketers predict their budget will increase in 2023, according to HubSpot Research. Whether your budget grows or shrinks, you should be ready to make adjustments.

As a marketing leader, you must set a budget and determine how the money will be spent. This step-by-step guide shares how you can write a clear, concise marketing budget for your startup.

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1. Calculate your revenue, and determine your budget.

Remember, startups typically need to allocate 11% of their revenue (before taxes) to marketing in order to grow. So deciding your budget is as easy as determining 11 percent of your gross revenue, right?

Maybe, but your marketing budget likely needs executive approval. Plus, you’ll want to back up your budgetary decisions with statistics and a solid plan.

Once you've identified your overall plan, you can get a ballpark budget estimate. As a guide, think about your business and campaign goals. From those goals, choose the areas you want to invest the most in.

2. Conduct market research.

Thoughtful research can determine which of your products have the best potential for paid marketing campaigns. You’ll also find out which channels attract the most leads.

Remember: Conducting market research might cost you money and require a spot in your budget. This is especially true if you need to incentivize customers to participate with gift cards or promotions.

3. Work with product and sales to identify campaigns.

Your startup sales and product teams have valuable insight into which products need marketing’s special attention. Work closely with these teams to identify which campaigns you want to roll out during the year.

4. Create a marketing calendar.

Assign marketing campaigns potential dates and costs, spreading them out throughout the year, so you don’t use your budget all at once. Once you’ve created a potential calendar, it’s time to get your startup marketing budget approved.

5. Get executive buy-in.

By this point, you should have a solid marketing budget outline. Your marketing budget will likely need explaining and persuasive reasoning.

Make sure you communicate the strategy behind every cost. Finally, be sure to highlight exciting opportunities and how they play into your budget decisions.

Getting Started

A clear marketing budget can help you grow your startup business. By keeping track of expenses and allocating funds towards essential needs, you can reach your campaign goals.

Having a marketing budget can also ensure you have the freedom you need to make decisions without having to run every idea past executives.

Be sure to leverage the passion your startup company has for its product to make marketing a successful and exciting endeavor.

Editor's Note: This post was originally published in March 2020 and has been updated for comprehensiveness.

Don't forget to share this post!

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• How to create a marketing budget

Marketing powers business growth. It is how you build overall brand awareness and encourage people to consider your product. While word-of-mouth marketing is ideal, the reality is that you will need to pay to attract prospective buyers. Part of your job is to create a marketing budget that allows you to efficiently generate and engage leads.

There are plenty of areas you can invest in — from content marketing to agency partners. But because there are so many different approaches you can take, deciding how much to spend on each program is a tricky balance. It is not always clear which programs or tactics will generate meaningful results for your organization. And folks across the company — particularly B2B sales teams — have lots of opinions about where marketing should invest time and money.

That is why it is so important to set goals at the marketing level that align with broader organizational objectives. With a clear definition of what you want to achieve — and how your efforts will impact the company as a whole — you can zero in on the tactics that will best help you get there. Then you can analyze costs and projected returns of those efforts in order to effectively allocate your budget.

Approach budget discussions with a clear plan that includes objectives, how you will achieve them, and the projected return of those efforts. This will help you feel more confident in the budgeting decisions you make.

Skip ahead to any section:

Who is involved in determining a marketing budget?

How big is a typical marketing budget, what expenses does a marketing budget typically cover, how to distribute the budget across marketing activities, tracking roi and adjusting the budget.

Before you can decide how to distribute your budget, determine how much money you have to work with. The following stakeholders typically work together to draft, approve, and allocate a marketing budget:

Finance and executive team: Finance and executive leaders across the organization may come together on an annual, biannual, or quarterly basis to allocate funding across the organization. Typically, the amount allocated is based on profitability and sales projections.

Marketing leaders: Team leads may propose a budget based on the anticipated spend needed to achieve the marketing goals .

Program leaders: Program leaders, such as the digital marketing manager or social media manager, may provide detailed budget requests for a given program.

No matter how your team arrives at the budget, you will be expected to make the most of what you are allocated. Be prepared to track spend and ROI closely — vying for a larger budget in the future depends on it.

Marketing budgets vary greatly. The more aggressive a company's sales goals, the higher the marketing budget. Some research shows that companies spend an average of 12 percent of the overall budget on marketing.

An organization's industry, size, and maturity also play a role. Business-to-consumer (B2C) companies tend to spend more on marketing than their B2B counterparts. So do organizations in a high-growth stage with ambitious lead targets. Newer companies make more quarter-over-quarter budget adjustments than mature organizations, which have a deeper knowledge of what has worked well in the past.

The best marketing teams enhance core programming with fresh ideas and innovation . It is important to leave room for experimentation in your budget in addition to funding the always-on efforts. These are the areas that marketing teams typically invest in:

Paid campaigns: PPC, banner, or social media ads

Events: Conferences, trade shows, or in-store events

Freelancers and agencies: Content, design, PR, and SEO support

Research: Surveys, focus groups, and other market research

Tools: Software and infrastructure (e.g., your website)

Determining the amount you allocate across all of these tactics and efforts requires trade-off decisions. Some marketing activities are better suited to lead conversion while others amplify brand messages. For example, if you want to attract new leads, you might spend more on digital ads . If you want to generate sponsored or earned media placements, you might hire a consultant or agency.

Your budget decisions should be based on tangible goals. Here is how to calculate the estimated cost and determine the appropriate spend:

Start with goals

Marketing goals should be time-bound and associated with measurable success metrics. Your target for each of these metrics should be practical and achievable. You may need to rank goals in order of importance — this will help you understand where you need to spend more of the budget.

Marketing goals and success metrics typically fall into these areas:

Goal : Build brand awareness Success metric : Website traffic, clicked links, ad impressions

Goal : Target new customers Success metric : New leads

Goal : Increase sales Success metric : Conversions (e.g. trial signup or purchase)

Estimate the cost of each goal

Now determine what it will cost to achieve each goal. You can estimate costs using data from prior campaigns. If you do not have historical data, refer to the averages for your industry. Identify the following across marketing activities :

Average cost per new lead

Average cost per conversion

Average cost per website visit or impression

Calculate spend

The next part requires a bit of math. For example, imagine that are planning a social media campaign that promotes your thought leadership content . You have set a target of 200 new leads. Based on prior campaigns, you know that your average cost per lead on social is $100.

GOAL (200 leads) x COST ($100/lead) = ESTIMATED SPEND ($20,000)

Allocate an appropriate amount of the budget to reach the lead target and repeat this process for each of your goals. If the cost to achieve your goals exceeds your budget, you can evaluate other marketing activities with a lower cost or adjust the goal target.

Much of this early budgeting work is based on projections. But as you begin to launch marketing programs and campaigns, you need to track progress towards your goals. Based on that progress, you might need to adjust tactics as well as spend.

Lots of marketing teams talk about tracking results and being data-driven, but few do it exceptionally well. It is easy to get stuck in the detailed work and forego reflection. For example, when attracting new leads, it is not simply about hitting the lead target number. Not all leads are qualified leads — some will be cheaper to generate but will never convert to a sale. That is why data-driven marketing teams calculate projected ROI during the budgeting planning process and then evaluate and adjust efforts based on the actual returns.

Projected ROI

Let's return to the social media campaign example to project an ROI. First, you need to estimate the revenue you will gain from attracting 200 new leads. This requires two additional metrics — lead-to-sale conversion rate and average sale price (based on organizational data or industry averages). In this example, lead-to-sale conversion rate is 5% and average sale price is $5,000.

[LEADS (200) x CONVERSION RATE (5%)] x SALE PRICE ($5,000) = ESTIMATED REVENUE ($50,000)

With this estimated revenue number, you can now calculate projected ROI using this formula:

[REVENUE ($50,000) - MARKETING COST ($20,000)] / MARKETING COST ($20,000) = PROJECTED ROI (150%)

Not all marketing teams use revenue to calculate ROI. Many teams focus instead on potential revenue added to the sales pipeline. Still, this is a valuable exercise because you now have a set of concrete numbers to use as a baseline.

As programs and campaigns get underway, compare projected ROI to actual ROI to select the optimal marketing mix going forward. Depending on the length of your organization's average sales cycle, you will need to make adjustments that work for your unique situation. To track actual ROI as you work, pay close attention to these metrics:

Number of new leads/conversions/impressions

Cost per new lead/conversion/impression

Total cost per program, campaign, or activity

Lead-to-sales conversion rates

Revenue or sales pipeline

This process is fairly simple for digital activities that have straightforward tracking, such as paid social media and search ads. For PR and content marketing, it may be more difficult to attribute new leads, conversions, and sales revenue directly. Marketing automation tools and tracking URLs make it more feasible to attribute leads or conversions to certain activities. But that cannot always account for a prospect's mixed use of devices (e.g., mobile and desktop) and other online variables.

When you know the ROI of your marketing spend, you can identify opportunities, limit wasted expenses, and refine the next round of budget planning.

Effective marketing depends on validated strategies as well as new experiments. Pay close attention to which efforts are working and do your best to duplicate that success. Strategic marketing teams use purpose-built software like Aha! to plan programs, prioritize activities, and show impact.

Plan, collaborate, and launch — all in one tool. Try Aha! free for 30 days.

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Making the Business Case for Your Marketing Budget

• Christine Moorman
• Jennifer Veenstra

How CMOs can move beyond short-term metrics and convince their colleagues that long-term growth requires patience.

Chief marketing officers are reporting increased pressure to prove the impact of marketing spending. But too often this means a focus on short-term metrics, like sales revenue, instead of longer-term efforts like brand building. To achieve their long-term strategic objectives, CMOs must work on building the business case with their CFOs and other peers.  The authors offer 10 actions that will help marketing leaders build the patience, trust, and confidence that long-term growth and value are on the horizon.

Scrutiny over marketing budgets is a common experience for most CMOs. In fact, as reported in the August 2021 CMO Survey , pressure to prove the impact of marketing efforts is substantial and rising, with 59% of marketing leaders reporting increased pressure from CEOs and 45% experiencing pressure from CFOs.

• Christine Moorman is the T. Austin Finch, Sr. Professor of Business Administration, Fuqua School of Business, Duke University. She is founder and director of The CMO Survey .
• JV Jennifer Veenstra is the executive leader of Deloitte’s Global CMO client experiences with 20+ years of consulting experience in market strategy and customer experience. Jennifer focuses her work on customer transformation especially as it pertains to the human experience and insights on the changing role of the CMO.

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12 Free Marketing Budget Templates

By Joe Weller | June 15, 2016

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A budget is a crucial part of any marketing plan. It gives a clear overview of all the costs associated with carrying out your marketing activities, including advertising, online content, branding, public relations, staffing costs and more. Creating a marketing budget can help you stick to your plan and avoid unanticipated costs, reducing the possibility of overspending. Since a marketing budget reduces risk and provides a financial road map, it’s a useful tool for both large and small businesses. It also allows you to determine the return on investment for different aspects of your marketing plan.

Accurately estimating expenses is vital for the success of your marketing goals, but you can measure your success by comparing actual expenditures against your projected costs. Your marketing budget then becomes an important reference for adjusting your plan over time as well as for creating future plans.

As you create your marketing budget, there are some clear advantages to using a template: prepared formatting and formulas, customizable features, organization and efficiency. All of the templates below are in Microsoft Excel format and are free to download. You’ll find comprehensive marketing budget templates for creating a detailed plan, with monthly, quarterly and annual views, as well as budget templates for specific marketing campaigns such as social media, website design, event planning and product marketing.

We've also provided marketing budget templates in Smartsheet, a real-time work execution platform that makes marketing budget tracking easier and more collaborative than Excel.

Marketing Budget Plan

Download Marketing Budget Plan Template

Excel | Smartsheet

This marketing budget plan template shows itemized categories, an estimated cost for each item, subtotals for each category, and a grand total. The simple layout is easy to read, and there is room for additional notes beside each category. This template is designed to let you organize all of your expenses into a single budget plan. Use it for annual planning or a marketing campaign of any length.

Annual Marketing Budget

Download Annual Marketing Budget Template

This annual marketing budget template offers a simple layout with columns for monthly, quarterly and yearly costs. The template includes categories for market research, branding, public relations, lead generation, digital marketing, events, sales support and travel. Organize your annual marketing plan while tracking monthly expenses. This template can be as detailed as needed depending on the scope of your marketing campaigns.

Simple Marketing Budget

Download Simple Marketing Budget Template

This simple marketing budget template shows projected and annual costs for multiple categories side by side. You can assign costs for each week of the month and track total expenses by month, quarter and year. This makes it easy to compare projected costs against your actual spend, and the template also calculates the difference. Choose whichever  categories work best for your business and marketing plan, and then enter your financial data.

Digital Marketing Budget

Download Digital Marketing Budget Template

Focus on your digital marketing budget with this free template. It covers various categories related to digital marketing, including website development and ongoing optimization, web analytics, paid advertising, SEO, social media and email marketing. Itemized expenses are totalled monthly and yearly. This template allows you to break down your digital marketing campaigns into a single strategic budget plan.

Social Media Marketing Budget

Download Social Media Marketing Budget Template

Use this free budget template to keep track of all your social media marketing expenses, from staffing and agency costs to content creation and promotions. Once you’ve entered your expenses, you can plan your monthly projections and track your remaining budget. You can easily weigh your year-to-date spend against your total budget and see what percentage of your  marketing budget is allocated to which social media marketing efforts.

Event Budget

Download Event Budget Template

Event costs may include advertising, venue rental, food and beverages, travel costs for speakers, decorations and more. Use this event budget template to plan all of your projected costs and track your actual expenditures. This template offers a wide range of categories, but you can easily edit them to be more relevant to your specific event.

Quarterly Marketing Budget

Download Quarterly Marketing Budget Template

If you want a template that shows only your quarterly marketing budget, this is a simple, one-worksheet version. Marketing categories are listed on the left, and quarterly tallies are on the right. Keep track of your itemized and total expenses for each quarter.

Channel Marketing Budget

‌ Download Channel Marketing Budget Template

This channel marketing budget template focuses on the expenses associated with marketing to four key  channels: brokers, distributors, retailers and customers. It also has sections for personnel costs, direct marketing, other expenses and projected sales. The template shows monthly and annual totals for each category.

Product Marketing Budget

‌ Download Product Marketing Budget Template

If your business sells products, research, focus groups and user testing help ensure that your marketing tactics and messaging are effective. This product marketing budget template includes categories for each phase of marketing as you move toward a product launch. Proper planning and research will help ensure a successful outcome, potentially saving you money in the long run.

Content Marketing Budget

‌ Download Content Marketing Budget Template

Depending on the scope of your content marketing, your budget may include expenses for freelancers, stock images, publishing tools, video hosting, analytics and more. This budget template covers multiple aspects of content marketing, calculating monthly, quarterly and yearly costs. Creating quality content that serves your marketing goals takes time and money, so plan your budget carefully to make sure all your bases are covered.

Website Budget

Download Website Budget Template

From brand messaging to reaching customers, a website is an essential tool for business success. If you’re developing a new website or redesigning an old one, creating a budget can help you plan for the initial investment as well as ongoing costs. This website budget template provides a section for monetary benefits, so you can contrast those amounts with your costs. Amounts are totalled annually, and you can view projected changes over three years.

Public Relations Budget

‌ Download Public Relations Budget Template

This may be the age of digital marketing, but traditional PR is still important to any marketing strategy. Manage all of your PR costs - from agency fees and trade show costs to research and reputation monitoring software - with this public relations budget template. Use the template as is, or customize it to reflect your own marketing categories. The template is organized so that your monthly projected and actual totals are shown side by side.

How to Plan Your Marketing Budget

Once you have determined your marketing plan and total annual budget, it’s time to align your budget with your marketing goals. What goals are you trying to achieve? This is the most important thing to keep in mind as you prioritize your expenses. We’ve already mentioned some of the categories that may be included in your marketing budget, from digital marketing to personnel costs. These categories are chosen based on your marketing campaigns and tactical plans for reaching your goals. Assign a budget amount to each category, and be thorough. You don’t want to miss hidden costs and then have to make up for it later. For instance, if you are marketing a product, you can’t simply plan your budget around promotional costs. You also need to consider the costs of any competitive analysis and consumer testing that might be required to ensure that your product launch and marketing efforts are successful. 

Keep in mind that expenses will vary from month to month. If you are over budget in a category during one month, look at your annual budget plan to see if this balances out later - perhaps because the category is no longer needed at a later date - or if you need to reduce costs in a lower priority area. Creating a detailed and realistic plan will help you stay on budget and on task for achieving your long-term goals.

Frequently Asked Questions

What Is a Marketing Budget Plan?

A marketing budget plan is a detailed roadmap that outlines the cost of all marketing strategies and tactics involved in hitting the projected results.

This plan provides visibility into both the specific goals of the marketing team and how much it will cost to achieve those goals. Considered a critical resource that can be leveraged by the entire company, a marketing budget plan gives insight into how marketing campaigns are run within the organization.

How Do You Create a Marketing Budget?

To create a succinct marketing budget for your business, first determine both your annual marketing goals and your positioning in the marketplace. Outline all projected plans you have for your product or services on an annual basis.

After these details have been analyzed, develop a marketing budget that allots a specific amount of money towards marketing campaigns and goals. Revisit the plan and budget on a regular basis to update the details as your business goals change.

How Much Should You Spend on a Marketing Budget?

On average, it is reported that companies should spend around 5% of their total revenue on marketing efforts in order to maintain their current position in the marketplace, according to FrogDog.

Companies that are looking to grow or expand their market share should allot a larger percentage of their overall budget towards marketing campaigns, landing around 10% of total revenue, according to FrogDog.

Improve Marketing Budget and Campaign Planning with Smartsheet for Marketing

The best marketing teams know the importance of effective campaign management, consistent creative operations, and powerful event logistics -- and Smartsheet helps you deliver on all three so you can be more effective and achieve more. 

The Smartsheet platform makes it easy to plan, capture, manage, and report on work from anywhere, helping your team be more effective and get more done. Report on key metrics and get real-time visibility into work as it happens with roll-up reports, dashboards, and automated workflows built to keep your team connected and informed.

When teams have clarity into the work getting done, there’s no telling how much more they can accomplish in the same amount of time. Try Smartsheet for free, today.

Additional Resources

Marketing management

Getting started with digital marketing plan templates, examples, and a guide

Develop a strategic marketing plan perfect for your company's needs and demands with customizable templates made for a variety of industries.

Apr 17, 2023

Free Marketing Calendar Templates in Google, Excel, and Word Formats

Organize your social media, blogging, editorial calendars, and more with these free Excel templates.

Mar 29, 2024 11 min read

Improve your marketing efforts and deliver best-in-class campaigns.

How to Plan a Marketing Budget [Step by Step Guide]

The marketing and budgeting of the marketing plan have become necessary for almost all types of businesses and companies. If you don’t know the cost of the marketing, then you can’t develop any plan. Today, we’ll discuss how to plan a marketing budget and provide you a step-by-step guideline.

Table of Contents

What is a Marketing Budget?

The marketing budget is a documented receipt which outlines that how much your business is going to spend on marketing over a period of time like monthly, quarterly, and annually. However, when you’re working on the marketing budget, then you should consider various relevant costs like web maintenance expenses, marketing tools, recruitment costs, paid ads, sponsored posting, and etc.

Why Does Your Business Need a Marketing Budget?

If you’re thinking about why your business requires a marketing budget, then here are some of the reasons why;

• Staying on Track. When you’re developing a marketing strategy, then you would require a budget to keep you on track. However, when you have a marketing budget, then you need to track the spending record of each marketing strategy. Like you have to check whether you are spending more, or you can. If you don’t have a marketing budget, then it’s like that you’re overspending it, and that would have a negative impact on your business.
• Right Allocation of Funds. The marketing budget would allow you to rightly allocate the funds at the right place. When you have a marketing budget, then you know your limitation that how much you can spend because you know that how much money you have allocated into the marketing strategy. Most importantly, it gives you an insight that what particular digital marketing strategy or package works under your budget.
• Goals & Benchmarking. When you have a budget, then it helps you to establish realistic goals and effectively benchmark your business. Budgeting allows you to expect realistically from different marketing channels. Most importantly, it gives you an understanding that how much money you should have for the marketing.
• Long Term Plan. The marketing budget is actually the planning of the long term, it means creating your marketing long-term plans. The long term planning restricts you from overspending on marketing and stops at a certain point because of the limited funds. When you have a flexible budget, then the long-term funding would allow you to develop an effective and consistent marketing strategy.
• Investing in Business Growth. When people think of marketing, then they see it as an expense of your business. It’s important to keep in mind that you should see marketing as an investment, and not the cost or expense. It’s an investment in the growth and development of your business. You can make out most of your investment if you learn how to plan a marketing budget.

How to Plan a Marketing Budget

It’s time to address the main question that how to plan a marketing budget, Here are the 6 steps of creating the marketing budget are as follows;

Create Your Sales Funnel

First of all, you should develop a sales funnel while creating your marketing budget. The sales funnel plays a significant and critical role in your market budget because it tells you where you should spend your money.

Speaking of the sales funnel, it’s important to mention it here that the sales funnel is a process where your audience goes through various stages into becoming an actual customer. Some of the main stages of the sales funnel are as follows;

• Awareness. This is the first stage where your target audience realizes the problem and then they start looking for the answer or solution.
• Consideration. The consideration is the stage when the target audience starts actively looking for the available options.
• Decision. It’s when the prospective customers to a decision stage, and they start narrowing down their options in terms of products and companies that offer the best solution.
• Action. After making the decision, the potential customer chooses a particular product or brand and becomes an actual customer.

The understanding of the sales funnel gives you an insight into when you should apply the digital marketing strategy when people are falling out of the funnel. For instance, you may have a plethora of people in the awareness and consideration stage, and very few of them reach the decision stage.

It’s natural that some of them would leave, if the falling out of the rating is more than expected, then you should consider other options. Like social media ads, pay-per-click ads, and video marketing. They would help you to generate more leads in the funnel.

If you want to learn that how much money you’re going to need for the marketing budget, then you should study the sales cycle.

Know Your External Cost

If you want to learn about marketing budgeting, then you should start with external or outside costs. It’s important to know the expenses that are costing your company so that you could allocate the marketing budget and resources accordingly. Some of the external and outside costs are as follows;

• Operation Costs (shipping, creating a product, etc)
• Employing Costs
• Running Costs (Bills of water, electricity, telephone, etc)
• Hidden Costs (unexpected cost like market research, product market test, etc)

You should keep in mind the abovementioned costs while planning for the marketing budget. It doesn’t only tell you what types of services you should invest in, but it also helps you find ROI (return on investment) as a baseline.

For instance, the manufacturing cost of producing a product is 10 dollars, and the sale price is 50 dollars. It means the marketing channel you have chosen for the promotion of your product is costly, and you’re familiar with its cost.

Speaking of marketing channels and methods, some of the following methods that you can use are as follows;

• In-House (marketing department of the company)
• Freelances (independent marketers)
• Digital Marketing Agency (an outsider marketing company that would layout the marketing plan and do the marketing for you)

Align Your Budget with Marketing Goals

Your business should indeed have marketing goals, however, they should align with your marketing goals. The first thing you should do is to make it clear that what end results you want to achieve through marketing. Next, you should set the required budget that would allow you to reach your marketing goals. Some of the main goals are;

• Expanding Brand Awareness
• Increasing subscription rate
• Increasing sales

When you’re creating the marketing and business goals, then keep in mind that they’re smart and specific. Your goals shouldn’t be general like increasing sales, because they won’t give the desired results. However, if you want to achieve results, then you should be precise.

For instance, your goal should be like that you would increase sales by 20% by the end of the year. You can easily measure such goals because they’re precise, achievable, realistic, and measurable. Most importantly, it gives provides you a reference point to start like how much you need and how much you should increase the sale.

Know Your Market

You should know your position in the market where you fall so that you could build an effective marketing budget. When you know the edge of competitors, then you can launch better strategies in order to compete with them. It’s better if you conduct a competitor analysis online.

Decide Your Marketing Strategy

It’s time to select the strategy for your marketing budget, and it’s OK if you don’t know what strategy to choose. Some of the main digital strategies are as follows;

• SEO (search engine optimization):  it’s the organic process of ranking up your website in the searches.

Cost of SEO:  it ranges from 500 to 20000 dollars monthly

• PPC Advertising:  paid per click advertisement is the paid tool that would rank up your website on the top of searches for some time.

Cost of PPC:  it ranges from 5 to 20% of your monthly ad spent

• Social Media Marketing:  social media marketing is the organic process of connecting with your target audience one-on-one. It provides you an opportunity to build and nurture a relationship with customers.

Cost of Social Media Marketing:  it ranges from 250 to 10000 dollars monthly

• Social Media Advertising:  social media advertising is a paid marketing and promotional tool. The sponsored posting allows you to reach more customers and generating leads with it through compelling ads.
• Email Marketing:  it’s a classic way of sending a well-written personalized message to the customers, and reminding them about the latest offers.

Cost of Email Marketing:  it ranges from 250 to 10,000 dollars monthly

• Content Marketing : it’s the process of generating through your valuable content and information that you share with your target audience.

Cost of Content marketing : it ranges from 2000 to 20,000 dollars monthly

Prepare Measure on ROI

When you’re allocating a certain amount of money to marketing, then you should know whether your strategy is working is not. ROI (return on investment) is a very good strategy. For instance, if your money is making a profit and giving good results, then you would increase it next year. If it’s not, then you won’t. This is the return on investment.

How Much Should Your Business Budget for Marketing

Now, the question is that how much you should invest in the marketing budget. It depends on the following factors;

• Age:  if your business is new and 1 to 5 years old, then you should spend 12 to 20% of your income on marketing. However, if your business is more than 5 years old, then you should spend 6 to 12% of your income on marketing.
• Market:  B2C (business to customers) companies should spend 9% of their earnings on marketing, and B2B (business to business) companies should allocate 7 to 8% of their income on marketing.

It’s not an exact rule. Every business and company is different in terms of budgeting, goals, objectives, and marketing strategy. Therefore, you should develop a marketing budget relevant to your industry.

About The Author

Ahsan Ali Shaw

Money blog: 10 wealthiest cities in the world revealed; bank launches £175 switch offer

Taylor Swift is coming to the UK - and bringing her massive economic influence with her. Read this and all the latest consumer and personal finance news in the Money blog - and leave a comment or your money problem in the box below.

Thursday 16 May 2024 00:01, UK

• Burberry suffers massive profits fall as figures 'leave a lot to be desired'
• Santander launches £175 switching offer
• Vinted forced to apologise to sellers for payment issues
• Taylor Swift to bring nearly £1bn boost to economy
• UK economy in safe hands 'whoever wins' election, top bank chief tells Sky News

Essential reads

• Top 10 wealthiest cities in the world revealed
• The 'fast food' trend hitting Michelin starred restaurants
• Basically...  What is PIP - and what could government changes mean?
• How to make sure your car passes its MOT
• Cheap Eats:  Michelin-star chef reveals his top steals in London - including an unbeatable sub sandwich
• Money Problem: My workplace wants to pay us by the minute - what can I do?
• Best of the Money blog - an archive

Ask a question or make a comment

A record 3.1 million emergency food parcels have been handed out in just a year, according to a charity.

The Trussell Trust says 3,121,404 were distributed by its network of 1,300 food banks in the year to the end of March.

Some 1,144,096 were for children and nearly two million for adults. The total is nearly double that of five years ago.

The number of parcels given out during the 12 months to March 2023 was just under three million.

You can read more here...

Nearly 40% of money laundering around the world is flowing through London, overseas territories and crown dependencies, the deputy foreign minister has said.

In a speech at the Bright Blue thinktank, Andrew Mitchell said the dirty money was passing through the capital and that "crown dependencies and the overseas territories have not yet done as much as they must do", The Guardian reports.

"If these overseas territories and crown dependencies want to have our king and our flag, then they must also accept our values, which is why we are so intent on ensuring dirty money cannot flow in and from there," he said.

The comments come a month after Mr Mitchell promised to work with the international community to tackle illicit flows of money "through increased transparency of company ownership".   

Feel like you've been on hold to the taxman for hours? You're not alone.

Customers spent around seven million hours collectively waiting to speak to HMRC in 2022/23, the spending watchdog has revealed.

That's more than double the time spent waiting in 2019/20, which was around 3.2 million hours.

It's the equivalent of 798 years.

Once answered, calls more than doubled to over 23 minutes in 20022/23, up from just over 11 minutes.

Advisers also answered 22% fewer calls.

HMRC's strategy is to encourage customers to turn to its digital services first - but it is not clear how far and fast digital services will reduce demand for telephone and correspondence services, the National Audit Office said.

And the move to digital services has not eased pressure on traditional services as much as HMRC expected.

Gareth Davies, head of the NAO, said: "HMRC's telephone and correspondence services have been below its target service levels for too long.

"While many of its digital services work well, they have not made enough of a difference to customers, some of whom have been caught in a declining spiral of service pressures and cuts. HMRC has also not achieved planned efficiencies.

"HMRC must allow more time for these services to bed in and understand the difference they make before adjusting staffing levels."

New York has topped the list when it comes to the world's wealthiest cities, with 349,500 millionaires and 60 billionaires. 

In its latest report,  Henley & Partners  found the Big Apple's millionaire population has surged by 48% in the past decade.

And San Francisco came in second place, with 305,700 millionaires and 68 billionaires.

Meanwhile, Tokyo has seen its millionaire population declining by 5% to 298,300 people.

Joe Biden has confirmed he is going to raise the special tariff on electric vehicles coming from China. 

The standard US tariff (the amount you have to pay to get goods into a given country) on cars used to stand at 2.5% but then Donald Trump levied an extra 25% tariff on China in 2018. 

Now, Mr Biden has gone further and is quadrupling the tariff to 102.5%.

Why is the US doing this?

Our economics and date editor Ed Conway  describes the latest move as "one of the biggest issues in economics right now".

He says the move "is partly because the US is worried about competition from China".

China in the past few years has become dominant when it comes to electric cars and their manufacture of the components that go into the vehicles.

But they are not dominant when it comes to electric car imports into the US.

"The US is trying to increase its share but it is going to be difficult," Conway says

"It's only the beginning of a very big saga here and the next question is what about the EU and UK?"

Will it have an impact?

Conway says the new electric vehicle rate "won't affect many goods at all" because the "vast majority of Chinese electric vehicles are going not to America but to Europe and elsewhere", including the UK.

"We're buying loads," he says.

You can watch Conway's analysis here...

Santander has become the latest bank to offer a £175 switching offer on their current accounts, joining First Direct, which relaunched its incentive this month.

The Santander switch is open to both new and existing Santander customers and those eligible will get the payment within 90 days of starting the switch process.

To qualify you must:

• Complete the full switch within 60 days of requesting the switch process;
• Pay in at least £1,500 within 60 days of requesting the switch;
• Set up two active direct debits within 60 days;
• Continue to hold the qualifying current account on the day the payment is made.

New customers can switch to a current account online through the Santander website or in branch. 

But existing Santander customers must visit a branch to take advantage of this offer .

To qualify for the First Direct incentive you must: 

• Go through the full Current Account Switch Service (Cass) process;
• Transfer a £1,000 balance into the account;
• Switch at least two regular payments;
• Use their debit card at least five times within 30 days of the account opening.

 The chairman and chief executive of JPMorgan has told Sky News he is confident the UK economy will be in safe hands "whoever wins" the election.

Jamie Dimon told Sky's Wilfred Frost that he had met with both Rishi Sunak and Sir Keir Starmer and liked that they were both "pro-business".

"Growing the economy is a good thing, and that should benefit everybody," he said.

"Everyone I heard in the Labour and Conservative government are talking about growing the economy, technology, research and development, simplifying regulations and making it easier for people to start and grow businesses.

"Those policies work."

Asked if he was confident the UK economy would be in safe hands no matter who won the election, he replied: "Yeah, I certainly hope so, and we would help whoever wins."

Mr Dimon also said the world "had been through a difficult and weird time".

On the UK specifically, he said: "It's a great country and partner and friend of America."

He said he was "optimistic" about the UK, and said the government should keep investing in "education, work skills and technology".

Here's Mr Dimon's interview in full:

By James Sillars , business news reporter 

A solid start to the day for the FTSE 100 despite one of its well known constituents posting a big drop in profits.

The index rose by 0.5% in early dealing to stand at 8,469.

Leading the gainers were industrial and mining stocks. 

Among the big names reporting its progress this morning was Burberry.

Its annual results to the end of March showed a 34% fall in operating profits as demand for luxury slowed in the second half.

The company's chief executive, who is in the process of taking the firm more upmarket, said he expected the current year to remain challenging but with a pick-up in sales weighted to the final six months.

Burberry, nevertheless, awarded a 61p per share dividend which was flat on the previous financial year.

Its shares were down by more than 3%.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: "Burberry's latest figures leave a lot to be desired, amid slowing demand for luxury... Not only does this highlight the extent of consumer caution across the globe, it also puts a spotlight on some Burberry-specific issues. 

"Refreshing the store estate is all well and good, but only if those costs and charges can be recouped by selling the clothes they hold. While Burberry's brand repositioning has come a long way, it’s not yet sharp enough to slice through to the core of the even more resilient end of the luxury market."

She added: "Slowing trends are being seen across the board in the sector, so these weaker results aren't a total bolt from the blue. The question now will be how quickly demand picks up, and that of course is in the hands of the economy... Burberry faces challenges, but it remains a strong heritage brand, with a lot of the right strategic ideas."

Taylor Swift's Eras Tour has been predicted to provide a £997m boost to the UK economy. 

Fans are expected to fork out an average of £848 to see the star on one of her 15 tour dates. 

That's according to data from Barclays, which has added up the total spending of the Swifties lucky enough to get a ticket.

After tickets, fans will spend the most on accommodation at around £121, with other notable costs including £111 on travel and £56 on an outfit. 

Those visiting London, Liverpool, Edinburgh and Cardiff for the concert are expected to spend £79 each on official merchandise, as well as £59 on a pre-show meal. 

The average amount spent on an Eras Tour ticket is £206, yet for 14% of fans, including those who purchased VIP ticket packages with premium seating and exclusive merchandise, the total exceeds £400.

Dr Peter Brooks, chief behavioural scientist at Barclays, said fans of "cultural icons" like Swift have a "powerful" spending power. 

"Whoever came up with the phrase 'money can't buy happiness' clearly wasn't a Swiftie," he said. 

"When it comes to cultural icons like Taylor Swift - like we saw with Elvis and Beatlemania in the 50s and 60s - supporters have such a strong connection to the artist and to the rest of the fandom that the desire to spend becomes even more powerful.

"For non-fans, £848 may seem like an enormous amount to splash out on a concert - but for Eras Tour ticketholders, every pound they spend is an investment in the memories they'll create."

Every Wednesday we get Michelin chefs to pick their favourite Cheap Eats where they live and when they cook at home. This week we speak to Andy Beynon, chef patron of Behind in London - which was awarded a Michelin star after being open for just 20 days. 

Hi  Andy, c an you tell us your favourite places in London where you can get a meal for two for less than £40?

I love Lahore Kebab House in Whitechapel. It's family run and I've been going there for about 15 years. I used to go with my dad - we'd get a couple of lagers from the shop next door, then tuck into lamb chops, tarka daal, the Peshwari naan, which is always cooked fresh on the tandoor, and all the dips on the menu. 

You can't beat a "That Spicy D" from Dom's Subs . There's just something about that burnt chilli mayo and schiacciata piccante. It's my favourite lunch to have on the go, and totally worth the mess. 

Umut 2000 in Dalston is my go-to for a kebab fix. They also do this amazing chargrilled lamb mince on a bed of tomato sauce with yoghurt and clarified butter. So good.

What's your go-to cheap meal at home?

I don't cook at home often, but when I do it's usually a big pot of spicy daal. It's super easy to make and keeps well in the fridge or the freezer. My secret ingredient for making the perfect daal is condensed milk - simply add a spoonful at the end to balance all of the spice.

We've spoken to lots of top chefs and bloggers - check out their cheap eats from around the country here...

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