Thursday, December 29, 2016

"Don't Let Your Budget Drive Your Marketing - The Opposite Is True"

Many people talk about carving out an annual marketing budget to handle websites, promotions, advertising, various media buys, events, sponsorships, and the like. This is the time that would be occurring for 2017, but hold on.

There are at least four reasons not to have a preset, predetermined marketing budget if we are a small company. Public companies (and larger privately held corporations) must formulate an overall operating budget with anticipated revenue and expenses in order to guide their operation, fulfill bylaw requirements, satisfy stockholders, and allocate resources.

The four reasons (at least) for not having a budget for marketing expenses are that: (1) it can be very limiting in not taking into account what needs may develop or transpire during the year that may cause a major shift in how monies need to be spent, (2) it may not be the right amount (too much or too little), and (3) there is a tendency to spend it all because "it's in the budget" - as if that money will vaporize at the end of the year if not used, and (4) opportunities or venues may come along that currently do not exist that will be great places or ways for us to showcase what we do. By not being flexible or open to new or expanding possibilities, referral sources that give us a fantastic return for very little investment, partnering with other organizations for a combined marketing effort, and other ways to publish and publicize our message are quite powerful..

What is the right amount to budget - if one was going to set aside funds for marketing? Some rules of thumb suggest somewhere between one and two percent of gross revenues be allocated to marketing. That is an average and should not be followed as a strict guideline. A startup business may need considerably more than that. A going venture, possibly less.

One of the major mitigating factors in recent years is the internet. As a result, print advertising has become less important and not worthy of the same type of investment in the same types of places. Rather than daily newspapers or consumer magazines, weekly or other small circulation neighborhood papers may have more impact. Websites can push out a lot of information for us at very little cost, and social media - unheard of a dozen years ago - is essentially free to use.

We certainly can identify places where we would like to have a marketing presence as well as ones that we think are inappropriate for us to use (from a circulation, audience, visibility, price, or similar standpoint). However, there is no way to tell what adjustments might need to be made over the course of a year based on on responsive certain messages are or how productive various campaigns might be. Some are going to work much better than others, and we may not be able to guess that in advance.

Therefore, rather than spending numerous hours trying to forecast where people might see our message and respond to it, how many times or insertions we might need to get that message well-publicized and circulated, and how much money we think it might take to make this happen, let's approach it from a position of need - where do we need to be advertising (if anyplace) or what do we need to be doing to call attention to our company and our services? With online and referral resources, it costs very little to do this. That all needs to be factored into the equation.

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Steve HoffackerCAPS, CEAC, SHSS, is a licensed Certified Aging-In-Place Specialist instructor and best-selling author of universal design books. To learn about this and other programs for aging-in-place or universal design, visit stevehoffacker.com or call 561-685-5555.