President and CEO at BreezeMaxWeb.
It’s easy for small businesses to fall into the trap of spending a lot of money on marketing in hopes of moving the needle. But in many—if not most—cases, using a small budget in a deliberate way is more cost effective and usually leads to more success.
Larger companies have the budgets to throw everything against the wall to see what sticks. But for smaller companies, less is more. Instead of trying all avenues, focus on two channels and do them well.
Set Clear Marketing Goals
Perhaps the most important first step is truly defining your marketing goals. These might change as the company grows or the business pivots, but at any given time, when kicking off a new marketing budget, it’s critical for small businesses to know what they’re specifically working toward.
For example, at a very basic level, if a company is trying to bring new users to a platform, the best play might be display ads. But if you’re selling a product, it might make more sense to direct the marketing budget to Google Search ads.
If a company is looking to acquire more newsletter signups or simply get more eyeballs on a landing page with a Call-to-Action (CTA), the plan of action is quite different than running display ads or Google ads.
Finally, remember with a smaller budget to prioritize quality over quantity. This means it’s critical to know and understand your target audience so you can determine what constitutes a good lead and what doesn’t. Figure out who’s most likely to convert and which channel helped capture their attention.
Be Deliberate And Focused
I’ve long touted a sniper approach. When a budget is limited, but the goal is “go heavy on digital,” the strategy is clear: focus on a couple channels and absolutely nail them.
Instead of going big on all social media networks, pick one or two where you know the audience is and focus there. There’s no need to create, manage and publish content on TikTok if your target customer is likely on LinkedIn.
It’s also easy to hear the success stories from other businesses on certain platforms and think it’ll be the solution for your business, too. What works for one business on a certain channel is not necessarily going to work for a different business.
This is easier said than done. If you want help creating a strategy, consider hiring a digital agency. A good partner agency can help you identify the best channels for your business or product based on your target customers, can help create effective materials to reach your customers and help fine tune messaging to get customers to convert.
Pay Attention To The Data
No matter where you end up distributing your budget—whether display ads, search ads or an integrated campaign—your marketing efforts will produce a good amount of data. Whether you have a data specialist on your team or use a marketing attribution tool, truly understanding what marketing strategies are working is important to your overall success.
Determine The Budget
Figuring out your budget shouldn’t be arbitrary. Your company type—and its goals—should determine which strategy you use to hone in your final marketing budget.
Some potential strategies include revenue-based, competition-matched, top-down and goal-driven. If a revenue-based strategy feels the most comfortable, the first step is to review your historical revenue sheets and allocate a specific percentage to use for marketing. According to BusinessNewsDaily, “some businesses might allocate between 6.5% and 8.5% for marketing purposes. … Businesses under five years old should consider spending 10% to 12% on marketing.”
If you have research on your competitor’s budget, another route is to create a budget based on their spend. A top-down strategy is based on management setting and re-setting budgets depending on several factors such as revenue, overall costs and personnel.
A goal-driven approach is led by very specific goals, such as increasing the number of followers or bumping up online conversions. A budget is assigned to each based on previous research and data and adjusted as needed.
Small and emerging businesses do not have to break the bank on their marketing budgets. If goals and strategies align, less marketing budgets can absolutely lead to more success.
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