You’re about to launch a new marketing campaign that might require you to perform a variety of marketing efforts, such as website development, advertising, content creation, work on your public relations, etc.
In this case, you need to work on what’s called a marketing budget, which, in a few words, helps you make sure you’re not overspending and that you’re allocating your budget where you should.
We’re sharing this post to help you understand what a marketing budget is, as well as how you can work on it effectively, whether you’re a small business or an enterprise.
More specifically, here’s a breakdown of the topics we’re going to cover:
- What a marketing budget is
- What’s to include in a marketing budget
- Why planning your marketing budget is necessary
- How to prepare your marketing budget plan
We’re also sharing four easy to use free marketing budget templates that you can download and work on yourself.
I’ll be talking you through the process of working on the templates.
There are no hard-to-understand budget calculators or complex cost trackers, we promise!
Let’s dive right into it.
Table of Contents
What’s a Marketing Budget?
Let’s start by defining what a marketing budget is.
To put it simply, a marketing budget is a plan that allows you to decide on the amount of money you’re going to spend on each section of your marketing plan.
In other words, it’s your total budget for a marketing project.
However, it doesn’t only record your marketing expenses, but also helps you to allocate your resources to individual sections of your plan.
Additionally, if it’s well made and thought through, then it’ll be easier for the marketing team to control if the marketing spend is justified and well spent.
Here’s a beautiful infographic by WordStream that illustrates the three main aspects of a marketing budget.
Analysing this, calculating your company’s revenue and taking into account the company’s size will help you get to the suggested marketing percentage that can form the basis of your marketing budget.
In other words, your revenue and company size are the two main points that define your marketing budget.
Below, I’m showing you two different marketing budget examples for two different company sizes.
First, a content marketing budget for a small business would most likely include information related to the monthly resources and a breakdown of the content marketing investments that need to be made.
The example I’m showing you a little further down breaks down the costs of content marketing for an enterprise.
Additionally, it includes data on the budget allocation for tools and graphic design assistance, as well as paid promotion for content.
Have a look:
If you’re a small business, breaking down the amount to spend on your content marketing allows you to keep track of your spending.
On the other hand, a content marketing budget for an enterprise is significantly different, as we’d expect.
In this example, because the company is bigger, they allocate some resources in-house and some others to vendors.
Since the amount of monthly resources is significantly higher than in the previous example, the breakdown of budget allocation leads to having more people and different roles involved, such as a content marketing manager, full-time writers, and graphic designers.
Additionally, the plan allocates budget to additional resources for technical support and content production, as well as tools and paid content promotion.
Put another way, what makes a significant difference between the two examples is to do with the monthly resources required for each content marketing campaign, given the size of the company and its needs.
I’d like to note that, because the length and content of your marketing budget depends on the expenses you want to outline, the results can vary due to the terms of the information you need to include in it that’ll help you achieve your lead generation goals.
Let’s get right into what’s included in a marketing budget.
What’s Included in a Marketing Budget?
In order to understand what a marketing budget is and how you could effectively use it in your business, we need to examine the type of expenses that you need to include in a marketing budget.
The following graphs will illustrate the definition of a marketing budget but, most importantly, will show you what’s usually included in a marketing budget.
For the sake of example, let’s say that you’re interested in working on your digital marketing strategy.
A digital marketing budget allocation might look like the following bar chart:
Such a marketing budget would consider all – or most – of the following areas that relate to digital marketing.
We understand that the most prominent elements of a marketing budget are:
1) Advertising budget
Budget allocation that has to do with Pay-per-click (PPC) and other marketing advertising models, such as the amount spent on display ads, search ads, etc.
Amount to be spent on improving organic traffic of your website and increasing the visibility of your brand and website pages.
3) Social media
Social media marketing budget needs to be allocated on social media promotion efforts in addition to social media management tools and tools for creating social media content.
4) Email marketing
Allocate budget to email marketing campaigns and potentially useful email marketing tools.
5) Public relations
Allocating a budget to your company’s public relations should also be considered, given that public relations help you get on-going relations with your clients and increase brand visibility.
6) Web design
The creation and amplification of your website is one of the main elements that you’ll need to have a budget for, because your online presence is one of the main channels of communication and interaction with your audience.
7) Marketing automation
Software platforms and other tools that can help you be organized and work efficiently should also be part of your budget allocation process.
8) Event marketing
Promoting your brand, services, and products through promotional events – both online and offline – along with experiences, is worth having a budget for.
9) Branded merchandise
Last but not least, the COVID-19 outbreak has brought many changes to companies around the world.
Something that’s significantly changed is that most companies are now working from home.
For that reason, it’s important for them to start thinking about allocating resources to maintaining team spirit.
Making sure that the pandemic doesn’t affect the way your team works might include creating and distributing branded merchandise.
Employee appreciation gifts should be on your budget list because they’ll show that you care and enhance the positive feeling that being a member of a team gives, which might be lacking within remote teams.
Additionally, offering branded gifts to your existing employees and new hires will make them feel motivated and work more efficiently.
I’m specifically referring to your new hires because of a recent SparkToro survey that gives us fantastic insights into hiring expectations for the last months of 2020 and 2021.
The graph above shows us that companies are considering hiring full-time marketers, despite the recession.
This means that welcome kits are relevant and should be considered when creating your marketing budget.
It seems that most companies won’t stop hiring and will keep investing in marketing-related initiatives.
In that context — and considering that many teams will be location independent moving forward – employee gifts will be a nice and thoughtful way to keep your team motivated.
Let’s move right to the next section about why you need to plan your marketing budget.
Why Do You Need to Plan Your Marketing Budget?
You may wonder what’s the reason for planning your marketing budget and working on it in detail.
To set a marketing budget for your business means that you’re creating an action plan.
Such a plan not only outlines your marketing goals, but also shows you what sort of market research you should be doing.
Additionally, you’ll get to grips with where the overall plan should be taking your marketing department team in terms of your marketing tactics .
By allocating a budget to different actions and departments within your company, you are trying to ensure that you’re not overspending and that you’re staying away from hidden costs surfacing.
More than that, you need to know that you have the resources to make your plan excel.
In a few words, planning will help you create a solid marketing budget, thus protecting you from overspending or spending resources on the wrong marketing efforts.
Here’s a list of reasons why you absolutely need to plan your budget:
- Avoid overspending
- Do the right investments
- Set the right expectations for your team
- Keep track of your revenue and expenses
- Control the financial status of your business
- Avoid spending on inefficient products and services
Put another way, a financial plan helps you control and manage all different aspects of your business finances, such as the cash flow, your financial goals, and your investments.
Moving on to the process of planning your marketing budget.
How to Plan Your Marketing Budget
We’ve now established why you need to plan your marketing budget.
How about actually planning it?
The process isn’t difficult at all, although it might be slightly tricky and definitely time consuming if you don’t make sure to keep all that’s not needed out of the planning process.
Our handy approach on how to plan your budget will be examined and explained in depth a little further down, when I’ll be taking you through our free and easy to use marketing plan templates.
For now, let’s talk about the basics in terms of how to plan your marketing budget.
First of all, you need to establish your targets.
In other words, are you targeting a super successful new product launch or is your campaign focused on promotional products?
Different goals require different types of marketing tactics and, by extension, different budget and financial needs.
After establishing your aims, it’s important that you define and have a clear idea about your annual marketing budget.
Part of this activity would be to record your expenses and revenue.
According to Deloitte, these are some general marketing budgets for companies, depending on the industry you’re in.
The reason I’m including this bar graph is because I want you to keep in mind that planning your budget is always related to both the size of your business, as we saw earlier, and the industry you’re in.
Understanding your industry and the attributes of your company is what will get you an effective marketing budget that saves you time and money.
Furthermore, your annual marketing budget will show you the categories you should allocate your budget to.
For example, you should make up your mind if you’re going to focus on amplifying your website or work on your social media promotion, like your LinkedIn account.
Alternatively, you may find that your company needs to focus on its content marketing and therefore allocates budget to blogging and content promotion.
Last but not least, put the information together and allocate budget to each of the needs your company has.
Be specific about the amount of money that’ll go to each of the categories I went through above.
That then leads us to the templates we’ve made for you.
Let’s see how they can help you plan your marketing budget.
Marketing Budget Template Types
As I talked about already, I’m going to take you through the process of editing the budget templates we’ve made for you.
When you download the document, I advise that you first have a look at this page, which includes some helpful guidelines for the use of the the template:
The guidelines take you through the steps that you’ll need to follow when creating your own marketing budget.
Keep in mind that the information you’ll be including in each one of these pages depends on the type of marketing plan you’re creating.
After having read the guidelines, you’re ready to move onto the ‘Lists Setup’ page, by clicking on the link I’ve highlighted for you:
The ‘Lists Setup’ page includes information about the investment and revenue type, as well as the creditors and types of services they provide.
Use that page to keep a record of all the necessary information which will basically form the content of the following spreadsheets.
After having set the type of revenue you’ll be going for – for example, in-store or online – you then move over to the ‘Revenue’ page – again, by using the link in the ‘Guidelines’ page.
Here, you’ll need to keep a detailed record of your revenue alongside keeping track of the type of investment, amount of money, as well as the date of the transaction.
Author’s Note: The content that we’ve added in these spreadsheets is all hypothetical and it’s been put there to give you a clear idea of what kind of information you should be adding, too.
You can go to the next page where you’ll be adding information in relation to your investments by either following the ‘Go to Investments’ link in the ‘Guidelines’, or by remaining in the ‘Revenue’ page, as shown above, and clicking on the ‘Investment’ link on the top right hand side.
Either way, both links will take you to the page where you’ll be adding your investments.
As you can see below, the information that you’ve included in the ‘Setup’ page will be available for you to work on in the all relevant pages.
Let’s say you want to assign one of your investments to one of your creditors, given that you’re at the ‘Investment’ page.
The spreadsheet is built in such a way that it allows you to pick information, such as the name of the creditor, as shown above, as well as the type of investment from the list you initially created.
That applies to any other type of information that you added in the ‘Lists Setup’ page – yes, the one you’ll have worked on in the beginning.
The steps described above take us to the ‘Reports’ pages.
There are four reports you can access and use.
1) Salaries report
The salaries report is where you keep track of the creditors’ salaries.
This one might be focusing on the creditors or the timeframe of salaries.
2) Investment report
The investment report focuses on the type of investment or the timeframe of the investment.
3) Revenue report
This report is to indicate the amount of revenue generated with a focus on the types of revenues or on time frame.
As with all reports, it comes with a pivot table editor that allows you to alter some of the factors and add content to the spreadsheet.
4) Monthly balance
Finally, the ‘Monthly Balance’ page is where all the information you’ve added – in terms of investments and revenue – in the reports shown earlier, is gathered and gets you the final balance for the month.
Let’s now look at some examples that’ll illustrate my point and help you start using the spreadsheets yourself.
Author’s Note: Please note that the amounts, investments, revenues, and names of creditors that are used below are all hypothetical and are used solely as examples.
Template #1: Annual Marketing Budget Template
Author’s Note: Our templates come in Google Sheets format. You can still download and use them in Microsoft Excel, but we can’t guarantee that they’ll be working as they’re working on Google Sheet.
The first use case would be an annual marketing budget template.
For an annual marketing budget plan, you should first go to the ‘Lists Setup’ sheet and add your annual marketing investments categories.
You can use the investment type column to write down investment types that are part of your annual investment, like social media marketing, content marketing, web design, and affiliate or branded merchandise.
It can also be trade shows, direct mail, products marketing and/or public relations budget, depending on the nature of your business.
You then go to the ‘Investment’ sheet and type in your investments, using the options of the investment types you previously added.
Additionally, you write down the amount of money spent on each type, the date, as well as the name of the creditor.
Click on the link to download the template:
Template #2: Digital Marketing Budget Template
Another use case for these templates would be to use them to plan your digital marketing budget.
That would mean that you go to the ‘Lists Setup’ page and add some digital marketing specific channels in the ‘Investment Type’ cell.
Have a look:
After having set your investment types, you’ll go to the ‘Revenue’ and ‘Investment’ tabs to add additional content.
Click on the link to download the template:
Template #3: Startup Marketing Budget Template
This spreadsheet could also be used as a startup marketing budget template.
Author’s Note: The investment types are adjusted to fit the needs of a startup. For example, we’ve excluded investment in long-term strategies like SEO since most startups need to find a product-market fit (PMF) first, before investing in long-term strategies.
Again, you’ll work on the investment types and add some line items that are relevant to a startup.
These are investments on social media, email marketing, social ads, and display advertising, to mention a few.
Click on the link to download the template:
Template #4: Small Business Marketing Budget Template
Another idea would be to use the spreadsheet to plan the marketing budget for a small business.
In this case, you might want to mainly focus on offline marketing tactics and investments based on your revenue and company size.
This would depend on the marketing goals you want to achieve.
For example, let’s say that you own a small business that mostly works with local people.
In this case, your revenue would be in-store only, and the investment types would be along the lines of:
Easy, isn’t it?
Click on the link to download the template:
Let’s wrap this up with some final thoughts.
Now Over to You
In this post, we’ve talked about why and how you should plan your marketing budget.
We went through the process of setting your financial and business goals.
Also, the process of keeping track of your revenue and investments.
Additionally, we worked through different types of marketing budget templates you can download and use yourself.
Is there any step that we missed in the process of creating our marketing budget templates?
We’d love to know more about your experience with the budget templates you’ve used in the past or with our templates.
Either way, feel free to leave a comment below.
Good luck with planning your marketing budget!