Budgeting can be tedious for some. There’s always something that distracts me from the marketing budget review process. Words, pictures, coffee… but anyone who knows me well, knows two things about me and my budgets.
- It takes me a while to sit down and focus on my own marketing budgeting.
- Once my budgeting process is complete, my focus, productivity and confidence soars.
To help with overcoming my marketing budget challenges, I allocate ample time, away from distractions in the office, and I follow a process. It’s how I ease into the number crunching.
First, Start with an Annual Marketing Performance Review
An annual marketing review gives me the opportunity to take a step back and look at the past year, all of its successes and failures. In some cases, there are also lost opportunities that could not be capitalised on, for instance, resources, lack of time or budget.
Second, Set your Strategic Marketing Goals
Before you begin your marketing budget review, it’s important to have a clear understanding of your objectives for the new budget year. Create a well thought out, documented marketing plan. It’s always difficult to determine how much budget you’ll need, if you don’t know what you’ll be doing. Start with objectives, then a strategic marketing plan. This will help you to determine your required budget, and to effectively allocate funds.
Finally, Crunch your Numbers
Once you’ve performed your annual marketing review and you’ve created a strategic marketing plan, you can start working on your numbers. This is where it really starts to get exciting. A well-crafted budget will keep you on track, focussed, hitting targets and will eliminate second guessing
But the work does not stop there.
Every Marketing Manager or Chief Marketing Officer should be able to answer questions about their required marketing budget. The more specific a marketer can be when explaining how marketing is contributing to company growth, by presenting facts and data rather than shooting from the hip, the more marketing will be viewed as an investment rather than a cost.
When you have finished your marketing budget review, here are 20 questions you need to be prepared to answer when seeking marketing budget approval for this year:
- How much did you invest in marketing last year? What was your total spend?
- Can you report on your marketing spend easily?
- What value was created by the marketing spend?
- Was there marketing activity that you did not or could not measure?
- What tracking needs to be put in place or improved?
- Which budgeting methodology do you use to determine this new budget for 2019? (Incremental, zero-based, industry benchmark, objective-based.)
- Are the accounts with the most potential getting the majority of the marketing budget?
- How do you measure the return generated from your marketing budget?
- Is your budget spread evenly across your markets or do growth markets receive more funding?
- Are you over spending or under spending relative to your competitors?
- Has your budget increased or decreased over the past 12 months? If so, by how much and why?
- How does the marketing budget contribute to the customer lifetime value?
- What are the benchmarks for each area of your marketing spend?
- How does marketing activity support sales objectives?
- What can you learn from last year’s marketing activity?
- Describe the talent (skills/competencies) required for the marketing team to achieve improved results?
- What are the benefits of each element of your Marketing Tech Stack?
- How often are vendor agreements reviewed and re-negotiated?
- How is marketing kept up to date on new product enhancements, or launches, and how often is it updated?
- What insight have you gathered regarding how your buyer’s journey has changed in the past 12 months?
Once you’ve worked through the 20 questions, you’ll realise where you need to spend more time making improvements that will positively impact your results. The review will give you a clear indication of how you track your marketing, helping you to determine what technology generates the best returns and where to allocate these funds in the future.
Well-strategised marketing budgets, with both the past and future considered, are necessary to expand awareness of your brand, break through the noise in the market and differentiate your company from the competition. There is no doubt that marketing is challenging. Getting return from your budget is harder than ever.
I hope you find the 20 questions provides you with a useful guide to determine a clear picture of your current marketing, and what you can do to gain greater results in the future.
If you need any assistance with your marketing budget review, get in touch. I am happy to help.