How much should I spend on marketing my small business?

Marketing budgets, especially when you are a small business can be tricky to nail down. Small business owners have limited cash flow, especially in the early stages of business. On the other hand, a substantial outlay in marketing could more than likely contribute to stronger revenue months and more cash flow in the future. 

This week on the podcast I sat down with Brand Marketing Consultant Stefanie McAuley. Stefanie is the founder of BroadWorld Consulting we talked about marketing, branding, and all the things in between.

What should be my first step in determining a marketing budget?

Stefanie stresses the importance of having branding and marketing working hand in hand. Understand who you are speaking to and what you want them to feel. Until you have your ideal client in mind and a proven strategy of speaking to them and converting them to a customer, don’t waste time or money on marketing.

Why is branding so important?

Marketing is a very tactical exercise; it involves a checklist of what you are going to do and when. Branding on the other hand is much less tangible for example, if you were to compare Nike Athletic apparel and Lululemon. Similar product and price point however branded to very specific audiences. Nike conjures up images of sneakers on a pavement, the sound of a timer or the feeling of achieving a new fitness goal. Lululemon on the other hand might make you think of a relaxing yoga class, taking a break or that physical release you receive from exercising. Its
important to understand who your business is naturally attracting, this will help you to create content, campaigns and an overall brand that attracts that client.

What are the non-negotiables to include in my marketing budget?

While there is no one size fits all approach to marketing Stefanie commonly advises clients on the same three marketing non-negotiables:

  1. A website is going to be a vital component of your overall strategy. It’s a place for potential clients to find you, and a place they can be converted to subscribers.
  2. A lead magnet from your website to convert visitors to subscribers to your mailing list.
  3. Setting up your presence on secondary channels: LinkedIn, Instagram, Facebook, Pinterest, Tiktok ect (Hint: Pick one or two to really focus on)

How much should my small business spend on Marketing?

While the answer is going to be different depending on your business structure, business stage and revenue goals. You can expect to spend more on marketing in the early stages of your business. This is simply because when you start you are still testing the waters on what strategies work, what platforms are getting the most conversions and what products, or services are going to sell. After some time has passed you will get a better understanding of those ‘sure thing’ strategies and be able to determine a comfortable budget of sure thing marketing investments & new strategies.

What’s the bottom line of Investing in Marketing my business?

Before even considering a marketing budget your business needs branding and positioning that truly speaks to your ideal customer, this should accompany organic strategies that attract and convert your ideal customer. For example, you should have a social media presence, website and opt-in that is already converting customers.

Once these basics are nailed down you can work on expanding your marketing to include paid marketing opportunities which will further propel your existing funnel.