If you are one of the many startup entrepreneurs trying to run a business on a shoestring budget, chances are that you will be looking for value for money in your advertising budget. While the general recommendation from the U.S. Small Business Administration is for small businesses to allocate 7-8 percent of their revenues to marketing, many new businesses start with a smaller marketing budget which means their advertising budget needs to pack a punch but costs less. While the advertising space can be extremely competitive, planning your advertising budget before initiating any advertising campaign is one of the smartest things a new business can do. While a small advertising budget, getting it right becomes even more important and a great planning process can help businesses do just that.
Ask The Right Questions To Get The Information You Need
The best way to allocate your advertising budget correctly is to narrow it down to where you need to spend your budget- and where you do not. This often means you need to ask difficult questions like what are your expectations for return on ad spend and your average cost per lead. Don't forget to include your customers when asking these questions. What channels do your ideal customer prefer? Where are they shopping and browsing the most?
Use Past Trends To Allocate Ad Funds
Most businesses set their marketing budgets by using goal-based budgets or benchmark budgets. However, benchmark figures can vary widely according to industry and business sizes. When deciding how to allocate your advertising spend across channels, use past data on conversion rates and cost per acquisition. For instance, an AdWords agency can help you convert past marketing data into usable information on the campaign types that are suitable for you. If your business marketing goals focus on branding, video marketing and remarketing are best.
Focus on Customers
A customer-focused advertising strategy never fails because it focuses on satisfying what the customer wants to see in a business' ads.
Designing your advertising strategy around customer wants/preferences also addresses a key recurring issue for many marketing compartments: getting customers to stay once they are in the door. According to a study by Cap Gemini, customers that connect with a brand also deliver 23 percent higher profitability and revenue. With this in mind, leave room in your advertising budget for ample customer and market research. Allocate funds to one on one interviews, use of media monitoring tools, and the design of customer surveys.
Lastly, don't forget to leave time for tracking. Regular assessments and adjustments of an advertising budget are needed so that you can ensure you get the best return on your ad spend and keep your advertising strategy relevant year-round. Real-time monitoring is key to targeting your advertising strategy to the right audience. This will allow your advertising choices to not only maximize your budget but resonate with your audience.