Establishing and figuring out how to spend your marketing budget is a crucial task for any small business. Many businesses base their marketing budget off of sales numbers but there’s no magic formula or percentage involved that will work for everyone. Establishing a marketing budget comes back to trial and error, what works for you and your business? Your budget will evolve over time as you figure out the best places to spend your marketing money. Keep in mind that there is always risk involved, you never know which of your efforts will result in success and which will crash and burn, but in the name of growing and sustaining your business, you’ve got to try.

Here are a few important points to consider when working out your small business marketing budget:

Set Goals– It’s essential to prioritize a few specific goals when it comes to deciding where to spend your marketing budget. Are you trying to increase sales, promote brand awareness, establish new leads? All of these things are important but you can’t throw a handful of darts at moving targets and expect them to all hit. Instead, take the time to do a thorough evaluation of your needs to figure out which areas of your business you’d like to improve and then use that assessment to set a few specific marketing goals.

Make sure your goals match up with your marketing efforts and to have a targeted purpose for your spending. An example of missing the mark would be putting your budget into SEO when your goal is to increase brand awareness. However, if your goal is to drive traffic to your website, or boost your search rankings, your budget should definitely include SEO.

Put Your Budget To Work – Once you’ve got your goals in place, you’ve got plenty of options when it comes to deciding how to put your budget to work. Take those goals and match them with the marketing tools that fit best. You might find it helpful to review a basic breakdown of popular marketing tools and tactics below as a small refresher:

  • Digital Marketing – everything online-based including website, social media and email newsletters. The handy thing about digital marketing is the access to analytics, which make it pretty easy to measure whether or not efforts are working, allowing you to adjust accordingly without much risk.  It’s worth noting that your website should be a top priority, it’s where people will turn to first for information. A good website is worth the investment, even if the initial investment is substantial; it’s an essential expense. Plan on keeping your website current and updated with easy to find links to all your digital marketing and social media accounts. Social media is another part of digital marketing. Although most platforms are technically “free”, expenses are still there hidden in ads, promotion, and other paid services and upgrades. Email newsletters can be very effective, with the expenses of newsletter advertising being relatively minimal for the return.
  • Paid Media Ads (television, radio, print, etc.) – While these are more traditional methods of marketing and advertising, and might seem old fashioned in comparison to digital marketing, they are still tried and true avenues. You need to know who your customers are and where they are watching, listening, or reading. If your target customers are more likely to have the radio on during a drive, or to be watching a TV show while they relax at home, you should look into paid media. Local market can have reasonably priced ad options and can be very effective at reaching a core customer base.
  • Direct Mail Campaigns – mailers, newsletters, postcard circulars. Many small businesses use direct mailers and circulars to keep their business visible and easy for customers to recall. Direct mailers can also be used to run special promotions and to promote repeat business by staying in touch with past customers, as well as to establish new contacts and potential leads.
  • Promotional Items And Public Relations – magnets, pens, calendars, sponsorships, etc. Though seemingly insignificant, these types of things actually play a major role in brand awareness and keeping your business at the forefront of the customer’s mind. Chances are, if you need a plumber and you happen to have a magnet on your fridge with the name and info of a local plumber, you’re going to give that guy a call first.

Do your research, know where you’re putting your money and what you’re trying to achieve. Consider this information to be the basic framework to help you establish and allocate your marketing budget and remember, it’s totally okay to adjust things while you figure out what works best for you and for your business. Once you’ve established the areas you’d like to focus on and have those goals in place, you’ll be in a much better position to keep spending in check and make the most of your marketing and advertising efforts.

For more insights on marketing strategy that actually works for small business, subscribe to the FreshLime Newsletter here. Connect with Jay Bean, Founder of FreshLime and Small Business Marketing Expert on LinkedIn and Twitter.