How much do you spend on marketing for your business? Like so many
areas of small business development the answer is, it depends. If your business is attempting to enter a competitive market there will be considerably more investment in branding and marketing than there will be once a name and reputation is established.
Here are some thoughts on investing in marketing and advertising:
- Use a percentage of total sales to determine your marketing budget: For most types of business, there are standards for how much of annual sales should be spent on marketing. Retailers for example, have used the 6-8% standard for decades. For most industries, trade associations and trade journals should have some percentage guidelines.
- It takes money to make money: Marketing and advertising only when you need to increase sales may sound good, but most businesses that cut back on marketing when sales are suffering likely have no overall plan. Instead of reacting to market conditions, it’s better to have a comprehensive strategy that sends a consistent message over a sustained period of time.
- Online and social media marketing cannot replace traditional marketing: While online marketing and networking are great tools for building a community of followers for your business, they cannot replace the branding, customer retention, and public relations components of traditional marketing. While online marketing efforts such as Constant Contact, Facebook, and Twitter are inexpensive (or have no cost), they do have hidden costs of your or your employee’s time. It makes more sense to have a strong combination of both traditional and online methods as part of a comprehensive marketing effort that has defined objectives and desired outcomes.