Could you be called “Shoestring Enterprises”?
Hopefully you’ve answered “yes” to this question (the marketing on a budget one at any rate). The reason is that it is vitally important to have some kind of marketing budget, even a small one.
(By the way – I make no apologies for this being a long blog post?it’s important subject and could save you a fortune).
When I speak to small business owners, I get to hear about all the problems that they have with their marketing. “This doesn’t work, that doesn’t work, I placed an ad in The Local Rag because they had cheap space?and that didn’t work either…and nor did the mailing list I bought“.
Generally none of these people have any kind of marketing budget. They think they’re marketing on a budget because they go for things that don’t cost much, but they’re actually just wasting money.
All that happens is that they spend on “marketing stuff” because it seems like a good idea at the time. And they have no idea if any of it works. In fact they think that probably none of it does. And so they think marketing is a waste of time.
When you spend money on marketing in this way, you WILL waste your money. You will NEVER see it back again.
Your costs will spiral and go out of control.
You’ll have no idea what works and what doesn’t.
And, yes, your marketing will be a waste of time.
Plan a monthly marketing budget and then plan how you’re going to spend it, in accordance with your Marketing Plan and you WILL make money from your marketing I promise, even if you are marketing on a budget.
Plan a monthly marketing budget and you can look forward to claiming control over your business.
Plan a monthly marketing budget and you will see properly sustained business growth (which is what you want right?…business growth = bigger income. Bigger income = the lifestyle that you want and deserve).
So…How Do I Get A Marketing Budget?
There are four ways to do this in the professional marketing world. I’ll talk you through three of them which are the most relevant to your business. One of the approaches is particularly suited if you are marketing on a budget.
1. Deciding and setting an affordable budget in line with your overall business plan / income
2. Setting your budget according to how much you want to pay per new customer
3. Setting your budget according to what you want to do
Over the next few weeks I shall be running a mini series on marketing budgets, going into detail about each of the methods above. I’ll start today by showing you how to make your marketing budget work for you (even if you have nothing).
So, here’s a secret for you?.
Ultimately, you know your income levels into your business and how much you can safely set aside for marketing.
Here’s the secret to safely setting your marketing budget though:
You have to be prepared to lose it.
Yep, that’s right. And it seems a bit strange to say if you’re marketing on a budget. Let me explain…
There’s a famous quote by John Wanamaker (not David Ogilvy as most people think!) which says “Half the money I spend on advertising is wasted; the trouble is I don’t know which half“.
There are various keys to successful marketing and one of these is testing. In fact it’s critical to your marketing success. Let’s assume that you have set yourself a marketing budget of Â£100 a month.
The first thing that this gives you is the ability to say “no”. This is the “no” you should automatically give when some publication (known or unknown) calls you up to ask if you’d like to advertise in their ever-so-special-never-to-be-repeated double page spread of special offers all focusing on…[insert whichever subject is relevant to you].
You can say “no” because you are unlikely to have budgeted for this particular publication’s activity. It has not come within your marketing plan, so it’s an activity that you will not be doing. I can also guarantee you that it will be waste of money so don’t get sucked in to the sales pitch!
But, what if you ignored me and you said “yes”…and you hadn’t set yourself a marketing budget? Well, you’d probably have spent about Â£100 on an ad (in this case) that you really didn’t know who it was going to, who else was going to see it, how it worked and so on.
All you know is that you had no sales, and the only call you got was from some kids mucking about. So you decide that this marketing stuff doesn’t work. (And, no, in this instance it won’t. The only people who make money are the publications – unless you get very lucky!). Trust me, this scenario is all too common and I hear it time and time again when I coach people on their marketing.
Marketing DOES work if you do it properly: you plan it, you budget for it and you test it.
Test, Test and Test again?
Let’s look at another scenario.
You decide that out of your Â£100 a month marketing budget you are going to get some leaflets printed. If you’re smart, and you’ve understood that marketing on a budget means that you have to get your money to work hard for you, then you will design two leaflets with different headlines. You then distribute these leaflets. You discover that leaflet A brought you in 1 new customer, and leaflet B brought you in 10 new customers. So, which is the leaflet you concentrate on? Absolutely, leaflet B. BUT, you’re now going to use it as a control and test it again against another headline, or by adding a photo or anything you like (NB only test one thing at a time).
Do you see how you may have ‘lost’ the money on leaflet A, but leaflet B more than compensated. If you’d only ever printed leaflet A, you’d again say “this marketing stuff doesn’t work”. Start using your marketing budget wisely to test various concepts (eg headlines, leaflets vs press ads, online pay-per-click vs offline classified advertising and so on)
So, this is why I say that you must be prepared to ‘lose’ your marketing budget. Marketing is a business expense…a cost of running your business. But it is also an investment. Like any investment, the value can go up as well as down. Use it wisely, in conjunction with testing and analysing, and you will see your business grow more than you can imagine.
But, Kim, I have NO money whatsoever!
That’s OK! If your budget is Â£0 (which, I can safely inform you, is precisely the same in US Dollars, or indeed any other currency!)…if you really are starting your business on a shoestring and definitely want to do your marketing on a budget (for that, read “non-existent funds”!) then it’s important that you write that down in your marketing plan.
Setting your budget at Â£0 means that you will not be spending any money with anyone or anywhere, no matter how good an idea it seems. It also means that you need to get creative and do lots of free marketing activities.
And that is a WHOLE other subject!
Hope that was helpful,
See you next week with more detail in setting budgets,
Have a great week,