How much should a small business spend on marketing in 2020? Your small business marketing budget for the coming year will depend on a number of factors, starting with the nature of your business.
If you have a seasonal business such as construction, for instance, you might want to allocate most of your market spend for 2020 on those months where you will actually be working. However, there’s still plenty of opportunity to employ time-tested online marketing strategies during your slow season.
A relatively new company that lacks any sales history will have very little to go on in terms of how much to spend so as to achieve a specific return on investment. In such cases, a good approach would simply be to decide on how much you can afford to spend each month on your total marketing budget and allocate percentages of the overall budget to specific areas.
Tracking overall annual ROI
Tracking your overall annual ROI on marketing spend will require a commitment on your part to take measurements throughout the year, so you’ll have an understanding of what is providing the most value to your company. Before you begin any of that though, you’ll have to decide what your marketing goals really are. Are you trying to increase brand awareness? Are you attempting to engage with customers more? Or are you simply trying to increase your bottom-line sales figures?
If you’re trying to increase brand awareness, you will need a baseline measurement to start with. You can obtain this by consulting a traffic analysis report which can easily be provided by analytics tools, or your BizIQ account manager. Then you can measure any increases to this which show up as more social media likes, increased web traffic, or more links from authoritative sites.
A company goal that is focused on increasing customer engagement can be tracked by monitoring the level of interest from users with regard to your website content, blogs, and posts on the social media. All these can be quantified and tracked so that increases can easily be identified. Some of the social media platforms include their own analytics tools to help you track these figures.
Measuring sales increases is easy enough, but in order to be sure that they’re tied to your marketing efforts, you have to establish a linkage between the two. Analytics software can help here too because it can identify exactly which marketing efforts (new content on your website for instance), leads directly to more sales conversions, and ultimately to greater sales figures. Your account manager here at BizIQ can review your site analytics with you at any time. Just give them a call!
Reducing or increasing marketing spend
When calculating a 2020 marketing budget for small businesses, it will generally call for an increase or reduction over the previous year’s budget. You might wonder why there would ever be a reduction since only increasing the budget will normally result in greater returns. However, not all marketing campaigns perform up to expectations, and the marketing vendors you do business with will not all show good results. That’s why it’s very important to evaluate and confirm just what each of your marketing vendors is providing for you in terms of value.
For instance, if your advertising campaigns with Yellow Pages, Dex or a similar company last year didn’t result in the desired increase in traffic and sales, you may want to reduce your investment there or drop it altogether. On the other hand, if an investment in a greater presence in phone books brought good results that you can clearly verify, you may want to increase your market spend in that area.
If your company has a marketing service with BizIQ, you can consult with your account manager to determine the best way of increasing or decreasing your marketing spend to achieve maximum value and ROI. Your account manager will have the knowledge and experience necessary to help you identify which marketing vendors are providing real value to your company, and which ones are not.
Once you’ve identified which ones have been worthwhile investments, the decisions will be easy in terms of planning for 2020.
Planning for 2020
The only way to determine the success of your marketing campaigns in 2020 will be to install a tracking system, and that tracking system needs to be capable of reporting on all the business analytics which will link results to your marketing efforts. Even though you have a good business relationship with BizIQ, which is among the very most reputable marketing consultants in the country, you’ll need to confirm that working with them is having a positive impact on your bottom line.
Almost any kind of metric can be tracked on your marketing campaigns. This means your direct mail campaigns, your internet content, your social media efforts, and any ads you run in magazines and newspapers. To install a tracking system, you’ll need to make use of various tactics. To track the effectiveness of display ads, you can insert specific codes that refer to the time they are being run, for instance, a code of ‘615’ might indicate that you began a particular campaign on June 15th.
You can prepare a questionnaire so as to survey user satisfaction with regard to a particular product you’re featuring, and you can conduct market surveys by phone, in face-to-face settings, or over the internet, to find out how consumers react to specific products. Ask purchasers how they found your company, so you’ll know whether it was from your website, through social media, or through pay-per-click (PPC). In order to be really effective though, you need to do your tracking on either a weekly or monthly basis, so you can find out exactly when trends are occurring, and you can then link those to your marketing efforts.
How much you spend on your 2020 marketing budget will depend to some extent on the nature of your business. Assuming your company is not a startup or a seasonal business, however, you can use information from past years to help you determine whether your marketing spend should be increased or decreased in certain areas, and with specific marketing vendors. To help you with future marketing expense decisions, you should definitely install a tracking system which will help you identify which tactics are most successful, so they can be repeated.