As a marketing manager, one of your main responsibilities is to manage and optimize your marketing budget. And this is not always easy! Most marketing managers are not trained for this task and have to learn on the job and improvise.
Here are 10 tips, from my personal work experience, to optimize your marketing budget.
1. Know your audience
This is my number one advice for any marketer, for any project.
Before you start defining a marketing budget or redefining your budget's allocation, start by creating an accurate buyer persona. What are their needs and interests? Do they have a favorite social network? What type of content do they like to consume?
Every time you need to make a decision about your budget, go back to this persona. It will really help you to optimize your marketing budget.
2. Clearly define your goals
Marketing expenses are nothing more than investments made to achieve goals. In order to achieve them, you need to clearly define them first.
I advise you to define 5 main objectives (not more) for the year to come. Ideally, these goals should be numerical for maximum accountability.
Here is a totally random example:
- Reach 150k$ in marketing-generated revenue
- Reach 5% conversion rate on the e-shop
- SEO accounts for 30% of inbound leads
- Set up a new marketing automation tool
- Recruit 2 new staff member
When validating your marketing budget allocation, you should make sure that it will allow you to achieve each one of these objectives.
It might seem obvious, but many marketers end up with budgets that are far too limited for their ambitions. There is only one solution: lower your goals or negotiate an increase in your budget.
3. Less is more
This advice is primarily aimed at small teams and/or young companies.
In terms of budget allocation, less is more. It is better to powerfully address a handful of channels than to sprinkle your budget over dozens of different channels.
This will allow you to know with greater certainty if the few channels used have been successful. Too many marketers give up on some channels without giving them a real chance. Some channels require a certain level of spending and/or time to see results.
4. Focus on what works best
This advice is complementary to the previous one. Once you have tested a few channels for a period of time, you should measure their effectiveness and allocate more budget to channels that have a good ROI.
What if you don't have a way to properly measure the effectiveness of your marketing actions? Well, make it an absolute priority for this year! I have written an action plan for 2021 about this topic.
5. Don’t scale until it’s profitable
There is no point in embarking on large projects without first testing the channel on a smaller scale.
For example, if you want to start producing podcasts, produce a few episodes in-house and see how your target audience responds to them. If the results are convincing, you can scale up the project and allocate more resources and time to it.
6. Invest in the long term
Driven by the pressure to deliver immediate results, it may be tempting to allocate the bulk of your budget to short-term investments (channels such as SEA, social ads, one-off influencer partnerships, etc.). Don't fall into this trap, you will regret it later.
My advice would be to allocate at least 60% of your budget to long-term investments, which will allow you to build brand awareness over time (SEO, content, PR, a new website, etc.) or to make your marketing team more efficient (marketing automation, teamwork tools, for example).
Marketing is a marathon, not a sprint.
7. Optimize non-paid efforts as well
When building your marketing budget, I advise you to carefully audit the non-paid marketing efforts carried out by your teams. I am talking here about efforts that cost you time, not money. But in business, time is money!
Here are a few examples of these efforts:
- visual or written content creation,
- time spent reporting or using inefficient tools,
- attend meetings,
- customer support,
If one of your team members spends for example 20% of his/her time creating visuals for social networks, ask yourself if this is the best use of his/her time or if you'd better outsource this task.
8. Create content with a lower budget
A simple tip to optimize your marketing budget is to make content for a lower budget and/or with less time. Content creation is one of the biggest challenge of marketing teams and it can be very costly. Here is what you can do without compromising content quality:
- Repurpose existing content into other pieces. For example, if you have created a webinar, you can repurpose it into blog posts, an e-book, videos, a newsletter, etc.
- Incorporate content creation into your day-to-day team's work. Make your colleagues aware of this need for content and the types of content you need. It can work for all types of businesses and at all seniority levels. Here are a few examples:
- A cosmetics brand: ask your beauty consultant to shoot a video of their colleague giving advice to a customer, for example.
- A B2B company: one of your sales representatives had a conversation with a customer who had a lot of preconceived ideas about your offer? Why not ask him to write a blog article addressing these preconceived ideas?
9. Know what falls under your scope
If your boss has defined a global envelope that you have to allocate on different channels and projects, start by carefully defining what falls under your scope.
For example, as a Digital Marketing Manager in a previous job, I realized that some of my budget items were related to print and events. So I asked my boss to move these items to other teams' budgets. This can be a simple and quick way to regain budget.
10. Similar efforts lead to similar results
I really like this quote mistakenly attributed to Albert Einstein: “The definition of insanity is doing the same thing over and over again, but expecting different results.”
It might seem obvious, but if your previous year's results did not live up to your goals, you need to understand exactly why and test new things, be it new channels, new tools, new suppliers, new messages, etc.
If you don't change your budget allocation, you will probably see similar results again.
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