Using your marketing budget wisely

Recently we looked at how to prepare a budget for marketing. So let’s assume that regardless of what method you used, you now have a marketing budget. So now for the tough choices, how do you spend it wisely?

Well that’s a bit unrealistic. You will have plenty of ideas for how to spend your budget. Just by working out your budget you will probably already have decided what promotional activities you need to get involved in. But there is a big gulf between recognising that you need to “advertise” and deciding how you are actually going to do that. The challenges are also slightly different depending upon your type of business. If you are a well-funded start-up with a strong business plan that has been approved by banks and investors, your challenges may be the same, but your focus will differ to the small one-person business just starting out, which is probably self-funded with limited resources. Much of this article will be more relevant to these latter micro-business.

One thing to try and avoid, is to take the “me-too” approach. This is really easy to slip into. You look at what other people are doing (your competitors) and do the same. So if they advertise, you advertise. If they run an event you run an event. If they offer buy-two-for-one you do the same. While this might seem attractive, on the basis that if it works for them it must work for you, it has a few flaws. One is that assumes that it does work. Many of your competitors can rely upon getting rid of the competition by out-spending them, forcing competitors to over-spend just to bar entry to the market and make sure that any short term competition is not able to grow into long term competition. The other flaws are that just because it works for them, it doesn’t mean it will work for you. Finally by following the herd you are going to be seen as “one of the others” rather than investing your marketing bucks wisely and growing your business.

The starting place to ensure you spend wisely is to define what you want to achieve. This needs to be with a dose of realism. While enthusiasm is a great bonus for any business, lazy-thinking that leads otherwise sane people to believe they can build their business by “doing social media” by having a Facebook page or writing a blog is not a realistic proposition. So knowing what you want to achieve, in a realistic way, before starting any activity is vital. Then find a way to measure it and track it. So for example if you are placing an advert, how many leads do you expect to get? , how will you track these leads, how quickly will you convert these leads into prospects? Then into customers? If you can find a way to track and measure these things you can start to measure your Return-On-Investment (ROI) from your marketing spend. Then, when you come to compare it with other activity, you have some hard data to review and identify what is most effective for you.

But as any home-owner knows, not spending your money is even better. So before spending your marketing funds have a creative think. Can you barter/trade/exchange for what you want. Could you get what you need by offering an exchange? Say you need some printing done. If you’re a copywriter you could offer to write an article or a press release for the printer rather than just paying them. If you’re a web designer you could offer to create/update their website. Have a creative moment, and see if there is a way of saving your money for when it’s really needed. It makes good business sense as well, moving the dynamics from just a paid transaction to suddenly having developed a relationship, got a new customer and maybe one that can be used as a testimonial.

Extend that thinking and identify if you could merge your activity with neighbouring business. So if you’re a hairdresser, contact your local florist and deli and see if they would like to join your event. Not only sharing the costs and the workload but also growing your business base (they will contact all their customers) and having an even greater event. And remember your favourite friend, good old PR. Do a press release before the event announcing it and inviting the press to cover your event . Then straight after the event (not months later ) do a follow-up, with event images, and you might find your event gets publicity, maybe bringing more prospect/customers than you achieved on the day. Businesses such as arts/craft and fashion designers have experienced a tidal wave of interest after recent press publicity.

Recognise though that PR is one of those things you have limited control over, you may get great publicity that sets you up, you may not get anything. So you should focus on marketing activity that you can have more control over and can help build your business. One of the quickest ways to get active, and get the resources to measure the success, is online activity. There are lots of free or low cost tools out there to do everything from customer surveys (survey monkey is a great free tool) to emails and e-newsletters, to help your marketing promotion. Not only is it fast, in terms of creating and sending, but its fast in terms of getting results. It provides a reliable way to customise your activity, for instance you can send one email to customers, one to prospects, and another to lapsed customers. You can also measure these, ensuring very quickly you can review and tailor or update your communications if needed.

Whatever your marketing activity is, remember to negotiate. For instance if you are doing press advertising there is likely to be a rate card, which is the cost for the advert. Always try and negotiate. It may not be that you get a big discount, or you may get offered a deal, like submit for two weeks and get one week free, but it’s always worth trying to identify if you can make savings. The lower your spend the more effective that marketing spend becomes. Whatever your particular industry, or market is, try and make your marketing activity unique and personal. By being innovative and high impact. If you’re a baker you could say your bread is the best in the world and offer a 10c off voucher. Instead if you offer a free interactive event baking fresh bread, with free taster sessions, demonstrations and recipes how much more interesting does that sound?

Finally, going back to the idea of “free PR” provide outstanding customer service. By doing so you will get customers who become your ambassadors, extolling your virtues and recommending you. Remember you are tracking all this activity so you will soon be able to tell what works for you (do more of it) and what doesn’t (stop doing it). Have a quick self-guide that shows what does work for you. Maybe identifiable by high-medium-low return activity. That way you can see at a glance what really works and take those high and medium opportunities as they come along.