Build­ing a busi­ness is a huge moun­tain to pre­pare to climb, but the reward at the top is worth every stride on the trail. One facet of busi­ness devel­op­ment you’ll need to con­sid­er is your mar­ket­ing strat­e­gy and how much to spend on your mar­ket­ing efforts. The typ­i­cal mar­ket­ing bud­get for a start­up varies, but you can count on it being a sig­nif­i­cant invest­ment. Com­mit to invest­ing in this branch of your busi­ness; it is the strongest (if not the only) way to get your busi­ness off the ground and running. 

Let’s take a deeper look at plotting your marketing budget and how much to invest in each element. 

How much should a startup spend on marketing?

 

Star­tups and small busi­ness should plan to spend about 7% to 8% of their gross rev­enue on mar­ket­ing and adver­tis­ing. If prof­it is falling below $5 mil­lion annu­al­ly, the U.S. Small busi­ness Admin­is­tra­tion sug­gests bump­ing mar­ket­ing spend up to 10% to 12% of gross rev­enue. It’s safe to aim for a mid­dle num­ber and adjust your bud­get as you watch sales and growth pro­jec­tions man­i­fest and soar or fall short of expectations. 

Is marketing spend the same in every industry?

The mar­ket­ing bud­get per­cent­age by indus­try might shift. Depend­ing on mar­ket sat­u­ra­tion, you might need to spend more or less than the sug­ges­tion to boost your brand’s preva­lence amongst com­peti­tors. Before devel­op­ing your mar­ket­ing strat­e­gy and spend, run a thor­ough com­pet­i­tive analy­sis that allows you to gauge how much work you have ahead. Keep an eye peeled for win­dows of oppor­tu­ni­ty to con­nect with and win niche audi­ences as your loy­al con­sumer base.

 

 

Where should I spend the most?

Where you invest your mar­ket­ing dol­lars is just as impor­tant as how many of them you invest. First, check off the basics: 

  • Web­site
  • SEO
  • Social media
  • PPC ads

Once your mar­ket­ing bud­get has cov­ered the foun­da­tion of your online pres­ence, hone in on your dig­i­tal mar­ket­ing strat­e­gy. In today’s tech­no­log­i­cal­ly infused world, the inter­net is the most obvi­ous place to find a busi­ness. Every year, few­er dol­lars are spent on tra­di­tion­al adver­tis­ing modes (though some still serve as valu­able com­ple­ments to dig­i­tal assets), and more dol­lars are invest­ed in dig­i­tal modes of communication.

How much budget should I dedicate to digital marketing? 

Small busi­ness­es should plan to spend 3% of total rev­enue on dig­i­tal mar­ket­ing. If you are fol­low­ing the SBA’s sug­ges­tion of 7%-8% total mar­ket­ing spend, that’s almost half of your bud­get. Dig­i­tal mar­ket­ing is impor­tant, expen­sive and worth every penny.

What’s the most important digital marketing asset to invest in?

Make sure to invest in mobile. In 2018, mobile is more impor­tant than ever, so por­tion off a gen­er­ous bit of your mar­ket­ing bud­get to opti­miz­ing your web­site for mobile users, devel­op­ing apps, set­ting up push noti­fi­ca­tions and find­ing clever ways to con­nect with con­sumers in the palms of their hands. 

If you are a small busi­ness or start­up, work­ing with a pro­fes­sion­al dig­i­tal mar­ket­ing agency is one of the best invest­ments you can make to cat­a­pult your com­pa­ny toward suc­cess. To learn more about the aver­age mar­ket­ing cost for small busi­ness endeav­ors, the resources avail­able to you and the tools nec­es­sary to jump-start your brand vision, get in touch with our savvy squad at Rosy Strategies. 

We will walk through every step of the marketing process with you, helping build your legacy and educating you on best marketing practices along the way.