If you’re one of those firms that has been getting by without a marketing budget you may ask yourself why you need one. Let’s say that last year you sponsored golf holes at a number of different outings. You have people out networking in the community and serving on boards. You took your clients to lunch regularly. Your firm offered a couple of seminars and sent out a few letters. And maybe you even are investing in an email newsletter. So if you have all this activity going on, why do you need a marketing budget?
Here are five reasons:
1. Control spending. The fundamental purpose of a marketing budget is to give firms control over their marketing spending. A budget enables firms to put aside a set amount of money that they would like to invest in growth and manage the way that money is spent each year. It precludes the open checkbook policy that causes firms to end up spending too much (or in many cases, too little) on marketing and sales activities.
2. Avoid random and ad-hoc marketing activities. Creating an effective budget requires some marketing planning to take advantage of the best opportunities for growth. This ensures marketing dollars are being spent in a manner that supports your firm’s growth strategy. Without a budget and this forethought, firms often struggle to reign in their spending. These same firms almost always find themselves engaging in one-off marketing activities that may or may not support a firm’s vision for growth.
3. Leverage investments. A by-product of developing a marketing budget is the ability to leverage marketing investments by creating activities that support each other. For example, investing in an advertisement in an industry journal can also support an investment in telephone lead generation that is also focused on that industry segment.
4. Measure results. Without a marketing budget it is impossible to measure the return your firm is generating from its marketing investments. Measuring results is critical in determining which activities you should continue to implement, and on which activities your firm should not waste your people’s time or firm’s money.
5. Ensure the proper balance between marketing and sales. Firms need to implement the right mix of marketing and sales activities to be successful in meeting their growth goals. By evaluating your firm’s marketing budget you can get a feel for how your firm’s business development efforts are divided among marketing, transition and sales activities to make sure the mix is appropriate based on your firm’s goals.
Yes, five reasons you need a marketing budget. What are you waiting for? Don’t know where to start? Call us today at 319.447.6400. To learn more about developing the right marketing budget for your firm, download our free whitepaper: Developing the Right Marketing Budget for Your Practice