You’ve just been handed your new budget. What’s next?
How do you transform these allocated dollars into measurable results? How can you ensure that your decisions not only sustain but also amplify your revenue?
That’s where marketing budget management comes into play. Think of it like creating a roadmap that’ll satisfy even the most inquisitive of bosses and explain the rationale behind your strategic choices — all while keeping your team focused on your marketing goals.
So, what’s the secret to success? Let’s dive in.
8 tips for managing marketing budgets
Even with some budget managing experience under your belt, every budget presents its own challenges. How can you get the most for those dollars? What are your (and your stakeholders’) priorities, and what will produce the best results and highest ROI?
Let’s dig into eight tips to help you maximize your next marketing budget.
1. Understand your buyer journey
Your “buyer journey” is a fancy way of referring to the steps your target audience takes to go from a prospect to a buyer.
Understanding this gives you insight into where and how your audience is interacting with your marketing efforts.
Are they seeing search ads? Are they reading blog posts? Are they opening emails?
Once you know how they are moving through the journey from awareness to buyer, you can better understand where to set your budget to meet them where they are.
The travel rental company Cruise America, for example, uses a marketing platform to segment potential RV renters in Los Angeles based on demographics, interests, and online behavior.
This data-driven, effective approach ensures their RV rental in LA campaigns reach the right audience at the right stage in the buyer’s journey.
Otherwise, it’s like throwing spaghetti at the wall and hoping you’re allocating your budget to the right place at the right time. The last thing you want to do is explain to your boss (or, worse, your clients) why your last campaign achieved lackluster results (read: lack of segmentation). So, don’t underestimate the power of data to help you:
- Align your marketing strategy to each stage of the buyer’s journey
- Learn more about your target audience and where they hang out
- Understand where to allocate budget
Let’s take a look at another example. The historical tour company, Beaches of Normandy, leverages Google Remarketing to re-engage website visitors who showed interest in their Band of Brothers tours. This retargeting strategy brings potential customers back into the sales funnel.
The best part? The brand is allocating marketing spend to target potential customers who are already interested in its offerings. That’s a more strategic approach than sending cold emails and hoping they drive tour sign-ups.
Additionally, with Facebook Custom Audiences, both Cruise America and Beaches of Normandy can reach new customers with similar characteristics to their existing ones.
All of this expansion comes from understanding the journey their target market goes on, then retargets and re-engages them to ensure continual growth.
2. Know your KPIs
Your key performance indicators (KPIs) are your metrics for success. They’ll be how you know if you’re moving forward, reaching goals, and have something to show in reports for the effort and funding you’ve spent.
Your business goals will largely determine what KPIs to track, but these are a handful you’ll want to know as you manage your budget.
- Cost per action (CPA): Cost to provoke action (click, download, sign up)
- Cost per click (CPC): Cost to have a connection/conversation/response
- Cost per lead (CPL): Cost to generate a lead (Name, email, phone)
- Cost per acquisition (CAC): Cost to turn someone into a customer
- Cost per mile (CPM): Cost to reach 1,000 impressions
These foundational KPIs will help you determine your marketing budget and track how much you’re acquiring vs. how much you are spending.
So, take a peek at some of these KPIs from past campaigns. Historic patterns will help uncover what types of marketing efforts are worth higher budget allocations.
For instance, if you notice that the cost per lead (CPL) is lower for social media ads than for search engine ads, you might decide to allocate more of your budget to social media this quarter.
In short, understanding and tracking your KPIs allows you to make informed decisions about where to put your marketing dollars to get the best return on investment.
3. Start with low-risk advertising channels
If you’re feeling very far out of your depth, you have a small budget to work with, or both, the best thing you can do is begin with marketing channels that are low-risk.
Email marketing is a perfect example.
Email campaigns are inexpensive to set up and run, and email marketing platforms are likely already an active part of your tech stack.
If you’ve been gathering email addresses and sending emails already, you have some data to start working with.
Retargeting, segmenting, and A/B testing your email efforts won’t cost you any more than you’re already spending on your email marketing software and has the potential for an incredible return on investment. You can allocate the same percentage of your budget to email that’s been allocated historically or scale up spending if your email campaigns are hitting your KPI goals.
As you start to segment your email lists more effectively, their performance will likely improve. If and when your email campaigns become more efficient, you can consider allocating additional budget to email marketing.
The graph below shows results from a study done by Litmus. As you can see, email marketing shows a tremendous return on investment across industries.
4. Don’t blindly follow the crowd
As a marketer, you’re often inundated with potential channels and platforms to market on. You’re going to hear about how everyone is running ads on Instagram, making TikTok videos, and using influencer marketing.
Some of those platforms might make sense for you, but not all of them will. So don’t feel pressured to pour a large (or any) percentage of your precious resources into a certain avenue simply because “everyone’s doing it.”
When building your marketing budget, you should allocate a small percentage, around 10%, to testing. Use that testing budget to try out new marketing channels. If a new channel is able to spend the test budget efficiently, then you can give it its own budget next quarter.
It’s best to pour the majority of your budget into the platforms and partnerships you’ve already established, are doing well, and make sense for your industry.
To learn more about the different social media platforms and which one might be best for your advertising goals, check out this article.
5. Divide and conquer
You can’t run an entire marketing program on your own. But if you’re under budget constraints, hiring graphic designers and copywriters in-house likely isn’t an option. If this is the case for you, figure out what you can outsource.
There are many talented, affordable freelancers on the market as well as affordable English editing services like Wordvice that can get you results on a budget.
You’ll want to do your due diligence here, however. Don’t be afraid to outsource, but choose your partners wisely.
There’s no hard-and-fast rule for how much you should allocate to outsourcing.
Want our advice? Start with a small investment that won’t devastate your budget if things don’t work out. A paid test project works wonders.
If you are happy with the output, then you know it’s worthwhile to keep investing more in outsourcing to freelancers of that skill and caliber.
If you find that the project isn’t up to par, move on and test with another freelancer. Or consider outsourcing to an agency with a proven track record (look for case studies and client testimonials).
6. Let technology help you
AI is a controversial topic in the marketing space right now, but it’s nevertheless true that technology can automate processes that previously took a ton of time and person-power to complete.
This is music to the ears of the marketing manager working with a skeleton crew (and budget).
Allow these new AI technologies to work with you to simplify your life.
Utilize automation whenever you can by exploring tools like Marin and their budget pacing software.
Marin offers effortless performance monitoring with dashboards that’ll show you how you’re pacing toward your current spend targets at a glance.
Additionally, tools like Airtable allow you to build robust content calendars and track your content marketing budget from the same screen. For every assignment you give a freelance writer, for instance, you can see the impact on your budget planning without having to toggle between software.
Whatever your preference is, make sure it’s doing the most for you. Technological tools and integrations are meant to make your job easier, not harder. So, put them to work.
7. Know how to report your ROI
Unfortunately, a lot of marketing expenditures don’t equal an ROI of cold, hard cash straight out of the gate. The majority of digital marketing strategies take a long time to convert to growth of the bottom line.
When you’re tasked with marketing budget management, this can feel dicey when it comes time to report.
This is why it’s important that you have clearly mapped and monitored your KPIs. Just as importantly, you need to have answers for why these KPIs will equal revenue growth over time.
Once you understand how to report on the type of marketing ROI you are bringing to the company, reporting will become a lot less stressful.
Bonus tip: if you have the time and skill, show your KPI stats visually as opposed to simply adding them as text figures to a slide deck. Studies have shown that when information is paired with a visual, the viewer retains it longer and has a greater impact.
8. Ask for help
You don’t have to feel like you’re completely unmoored in an ocean where no one has ever managed a marketing budget before. The truth is that lots of marketers have been in your shoes and lived to tell the tale.
If you’re feeling way over your head, ask for help.
LinkedIn is full of helpful professionals sharing their knowledge and expertise. Follow them, network with them, and set up a call to see if they’ll give you some pointers.
Endless free or inexpensive courses are available all over the web, too. You can find one for your exact set of circumstances and build your knowledge that way.
You can also go the consultant route and hire a professional or agency to help you navigate your obstacles.
No matter how you choose to seek help, you don’t have to handle it alone. There’s lots of help available. You need only ask.
Wrapping up
Marketing budget management can be tricky, particularly if you’re a creative who hasn’t managed a budget before. Even if you have some experience, marketing budgets are often small, and progress is difficult to prove.
While you have your work cut out for you, being strategic and data-driven in your approach, clear about your goals, and organized in your implementation will earn you results.
Utilize automation tools and the wisdom of outside voices to help you on your way, and your marketing team will be a budget-balancing wizard in no time.
