One of the first questions we ask a potential client is, “Do you know what your budget is?” This is when see the client’s eyes go big as they reply, “I have no idea! That’s what I thought you were here for.”
New businesses- For companies that have been in business for one to five years, we suggest using 12 to 20 percent of your gross revenue or projected revenue on marketing. (Companies less than a year old, need to ramp up before spending marketing dollars.)
Established businesses: For those companies that have been in business more than five years and have market share/brand equity, we suggest allocating between 6 - 12 percent of your gross revenue or projected revenue.
This may seem like a high budget, but remember new and emerging companies are looking to capture new market share and develop brand recognition with an audience that is meeting a new stranger.. That’s why it’s so expensive. Once the brand is established and a portion of the market is aware of the brand, that number drops significantly.
As you can see, you have flexibility with your marketing budget. However we have a feeling you are not even marketing at 5% of your sales. Great if you are! If you are not, brace yourself. The giants of E-com and Search are coming for your businesses market...