How do I Use the Marketing Budget Calculator?
If you have a product or service that requires connecting with new clients and customers – it’s likely true that if you’re not growing you’re dying. This digital marketing budget calculator is intended as a guidepost along your journey so that you can find the most accurate and appropriate marketing budget and digital marketing budget for your company.
What You’ll Need:
- Your business’s annual revenue.
- Your range of time in months. Is this a quarterly budget? Bi-annual? Annual?
- Your industry (this can be broad).
- Your % of revenue generated from online business.
- How many staff are on your marketing team currently?
- Your estimated marketing budget to maintain: the low-end and the high-end.
Why did we provide this resource? We serve contractors and home service companies with marketing + web design! Check out our blog posts about Plumbing Leads, Electrician Leads, Roofing Leads, HVAC Leads, Construction Leads, Remodeling Leads and our Plumbing SEO, Electrician SEO, Roofing SEO, Contractor SEO, Remodeling SEO, and HVAC SEO services!
The Average DIGITAL Marketing Budget is increasing to 50% on average in 2021
If you’re in an industry where digital marketing can have a greater effect, of course, digital marketing could be much, much higher – and in some cases is 90% of some company’s budgets. In e-commerce and B2C service-oriented businesses, for instance, sales directly on site, and leads from their website can constitute 90% to 100% of certain businesses’ overall revenue, and thus the portion allotted to digital should correspond!
5 Quick Stats About Marketing Budgets
- 48% of companies are spending 4-10% of revenue on marketing according to our poll – Source: Hook Agency
- 50%+ of companies say the largest ROI from marketing comes from search-engine related disciplines – including paid search, SEO and content marketing. Source: Hook Agency
- 44.4% of organizations polled said that their top marketing objective was to increase their amount of leads. Source: Hook Agency
- 69.7% of people said they were spending >HALF(!) of their budgets regarding marketing on digital/online marketing for 2021. Source: Hook Agency
- According to Brafton – companies spend 11.2% on average on marketing. Source: Brafton/Gardner CMO
This digital marketing budget calculator gives high’s and lows
We made this tool for people to give them greater clarity and confidence in what they are spending online. If you’re a director of marketing, business owner, or just someone who wants to get more clarity about how the different pieces of digital marketing might fit together for your particular situation – Schedule a consultation now, and we can walk you through some suggestions based on your unique business model.
What if I’m currently spending more than the marketing budget calculator suggests?
It’s important to look at the totals more than the individual spends. These numbers are just based on benchmarks across B2B and B2C products and services. If you spend more on SEO than you do on social media marketing, or e-mail marketing – consider that when looking at suggested spend per category. The most important number is the ‘total marketing budget’, how you split that up is up to you! Use your budget wisely, but customize the specifics to what makes the most sense in your market and with your resources. However – if you haven’t been spending any time or effort on e-mail marketing for instance, perhaps it’s time to look at a newsletter, some kind of giveaway, and automation – along with building your e-mail marketing list. Certain markets like B2C services might need to be a little bit more creative with this, but if you make the content useful to your audience – it will always be a good idea. Also – check out our ‘How to Get Results Fast as a Crazy Awesome Marketing Director’ Guide!
Marketing and Sales Allocation
A CMO Survey suggests that 67% of companies give marketing and sales joint responsibility– 7.5 percent put marketing in charge of sales, 10% put sales in charge of marketing, 13% do not have a sales function, and 2.5 percent of all companies don’t even have a sales function! Marketing spend seems to go up when Marketing is in charge of sales – some might say that because they are taking a more long-term approach, that it’s less about the moment and pushing to milk the very last drop of sales to reach goals, but rather are nurturing leads with the marketing strategies. It all depends on the tactics used of course. Your marketing budget spend, and your digital marketing budget should reflect who you are as an organization and the present economic situation of your company – but more importantly, where you want to go.
Hiring an Internal vs. External Marketing Team
When it comes to marketing spend allocation, the question remains, should you hire an internal or external marketing team? As you can see, it can be a very complicated decision on where to allocate funds as well as work in your marketing and sales departments. There are many advantages to both internal and external marketing teams, but also their fair share of downfalls. When you think about it from a business perspective, an internal team knows your company well, and is fully dedicated to you and your marketing efforts alone. But, it can also be quite costly to pay multiple salaries of a medium-large marketing team, depending on the size of your company. Hiring an external marketing team, on the other hand, doesn’t have that same internal feel and knowledge, but can save a lot of money by having one flat rate, while getting a much larger toolbox of people and resources. This is definitely something to consider when determining your marketing spend budget, as salaries can make up such a large part of it. This is why it’s included in the Digital Marketing Calculator. We’re not saying go and fire your internal marketing team if you have one, but hiring externally for small businesses starting out can be a great move financially and boost your marketing efforts.
Other amazing marketing calculators/inspiration
I am not the first person to do a marketing budget calculator or a digital marketing budget calculator. I thought of this originally but then went out looking for people who had done it well previously. I drew inspiration from these three other sources, and then created something along the same lines. Anyways – a deep appreciation for these other amazing marketing budget calculators and marketing budget for 2021 data-points and studies: 1. Web Strategies – Free 2021 – Digital Marketing Calculator 2. 6S Marketing – The Digital Marketing Calculator3. Web Page FX – Online Marketing Calculator (Based on Your Budget)4. Deloitte and CMO Survey on Wall Street Journal
Why I made the Marketing Budget Calculator
I definitely don’t suggest people who are making 50k to 200k spend to much MONEY on their marketing and digital marketing, but I generally highly suggest spending a lot of EFFORT. It’s when your time becomes worth more than your money that you’ll want to start outsourcing your marketing efforts. The marketing budget calendar was made to help you make these kinds of realizations a little easier. I want it to be easy for people to decide whether they should hire people internally, utilize different agencies or marketing experts who are experts at their respective specialty. I made the marketing budget calculator as well so that I could provide a resource to the marketing industry – use the calculator without providing an e-mail! Only provide an e-mail if you want to send a saved version to your e-mail for later reference. I’d love if you included the marketing budget calculator in your monthly resource roundups, or in any other articles – and post about it on social media if you have a moment! Don’t let this awesome tool go to waste. 🙂
Commonly Asked Questions About Marketing Budget Calculator
Why is it important to have a digital marketing budget?
There are a number of reasons its critical to have a digital marketing budget: one being that every aspect of your business should be budgeted. But also, a marketing budget allows you to set your strategy and then make sure those things you planned actually happen. Also, it ensures you stay on target for both estimated and actual marketing costs. And lastly, it makes allocating funds and resources to the appropriate areas better and more refined with every budget (monthly, annually, etc.)
How much should I budget for marketing?
For every 100 dollars, you make in your business – you might spend 10 on marketing, except for in ‘high cost of goods sold’ companies – who may spend 3-5 dollars out of every 100 instead. This according to a cross-section of many surveys of benchmarks for marketing spend in businesses.
How do you calculate marketing costs?
Your marketing costs should correlate with your company’s desire to grow and if you have some attrition in current customers – it should also correlate with maintaining your existing trajectory. Find the benchmarks in your industry – and balance those with your intentions for growth, and test the waters with those numbers, and tweak the budget each year based on your previous year’s budget’s ability to get the results intended. If your previous marketing costs didn’t give a significant R.O.I., try new methods regularly. SEO, E-mail marketing, Video marketing, and Event marketing all seem to have higher than average perceived R.O.I. if done right and regularly.
How do you plan a marketing budget?
Find what companies in your industry are spending, and balance that with your company’s desire for growth, and then start with the highest perceived R.O.I. methods like SEO, event marketing, and video – or whatever those are in your industry. Consult with experts in your industry as much as possible, and then experiment vigorously the first year – pushing further on the methods that start to show a return. Use a template like these to present your plan to other leaders at the organization: hookagency.com/marketing-plan-templates – then hire any appropriate specialists if needed. Send us a message now if getting higher on Google is important in your industry.
Other amazing resources for planning your marketing budget for 2021
Create a marketing plan in the easiest ways possible, Enjoy these free marketing templates…
Many companies are planning their marketing budgets for 2021 – and maybe looking for industry averages for marketing spending…