“How much should I spend on marketing to reach my company’s goals in 2017?”
Well, before you can answer that question, you must first ask yourself a few other questions. What is your overall marketing strategy? What type of growth do you want to see in 2017? Where do you want your company to be in 10 years? Where do you see it in 20 years?
Once you determine some of these higher level business planning questions, then we can dive into the question about marketing budgets.
However, like many topics in the marketing world, there’s not one simple answer to fit everyone. It depends on several factors…what kind of industry are you in? What kind of market share do you currently have? What does your primary competition look like? Are you wanting to maintain your current sales numbers or are you looking for major growth?
All of these factors must be taken into account, as well as established financial commitments, but Entrepreneur.com suggests that companies that are better established spend 6-12 percent of gross revenue or projected sales. For newer companies, Entrepreneur suggests 12-20 percent of projected income.
While these numbers may seem like a lot for many business owners, you have to remember that you cannot have a Dollar General marketing budget and expect Nordstrom type sales. There is a direct correlation to smart and targeted marketing expenditures and strong sales numbers.
In addition to not reaching your sales projections, not spending enough on marketing may also keep your team morale down as team members become frustrated by the disconnect between sales expectations and their ability to deliver with limited resources.
Obviously, no one wants to spend more money than necessary, but without a major commitment to marketing, your company may be hard pressed to achieve the kind of results that you desire.
Want help determining your company’s marketing strategy for 2017? Contact us today for a free consultation!