The term ‘marketing budget’ refers to an estimate of projected costs which are necessary in order to market your products or services. A usual type of marketing budget will take into account all marketing costs, for example, marketing communications, salaries for marketing managers as well as cost of office space. However much of the marketing budget is concerned with marketing communications such as public relations, website and advertising.
How Are Costs In A Marketing Budget Allocated?
The expenses in a marketing budget will be distributed according to the campaign as well as the media to be used. Some research beforehand will be necessary for the cost estimates to be as realistic as they can. This is termed advertising or marketing communications research.
Helpful pre-budgeting research activities include:
- Conducting industry and market research
- Carrying out a competitor analysis or a SWOT analysis
- Analysing internal marketing performance records, such as marketing metrics as well as marketing controls.
- Conducting a marketing audit.
Having a good knowledge of key industry and market factors should be taken into consideration when putting together your marketing plan. Your plan will also be affected by researching your competition. In other words, you will want to allot funding in a manner which exploits the weaknesses of your competitors and emphasises your strengths.
What Other Information Can Guide Your Spending Plan?
Other information which can guide your spending plan is to be found in your internal records. What type of advertising expenditure have proven successful for your business in the past? For instance, you can review internal records and determine the return on investment of your advertising rands. A periodic examination of these records may lead you to drop certain media that have not proven fruitful.
Typical general marketing expenses include:
- Advertising agency commissions
- Salaries for marketing managers
- Salaries for marketing support e.g. marketing assistants.
- Office space
- Fixtures and fittings
- Travel costs
- Other direct and indirect marketing costs, including marketing communications costs (see below).