HOW MUCH DO YOU NEED TO SPEND ON MARKETING

Getting the money to Market and Advertise a business is often not easy. When times are tough as we have it now, people tend to cut back in the area of advertising – this is actually the time that advertising and Marketing should be increased but it rarely happens that way.

Most businesses that come to me for advice have very limited budgets, my advice is always the same- the size of the budget doesn’t matter but how you use it. A company with a N20,000 per month marketing budget probably needs to generate a few thousand naira per year. A company with a million naira per month budget needs to turn over tens of million per year.

Determining how much you should spend promoting your business is a difficult decision. The accepted way to arrive at a marketing budget is a percentage of your total turnover, anywhere from 5% to 20%. It is always wise to talk to your accountant or financial advisor when it comes to setting a budget, but remember, marketing should be a fixed cost like electricity or rent.

Don’t think you need to have a marketing budget of hundred of thousands to produce results. There are thousands of small businesses that have advertised very smartly for very little financial outlay. Look realistically at what you can afford on a monthly basis, set this money aside and assess your marketing options. Try not to be stressed about the amount that you have and don’t be afraid to tell people what your budget is especially if they are trying to sell you some form of advertising. Tell them what you can afford and what they can do to promote your business with the amount, every deal is negotiable. if they want your business badly enough they will offer you an incentive to do business with them.

Most importantly, you need to note that spending money on marketing is a waste of time if you can’t give your customers what they want.

Before you start marketing look long and hard before you stat marketing to make sure you can meet the expectations. What is the point of spending money to get new customers only to have them come to your business once and never come back?

I will give you many free and low-cost Advertising and Marketing ideas that will bring you business in 2010, but first make sure your business can do what you say

See you in 2010