When marketing is done right it can create miracles for your business and once you understand the principles behind it then having a strictly limited budget will sound unbelievable.
When you set a marketing budget you are implying that one your marketing isn’t working or two you have no idea if it is working, as you aren’t measuring the results. You are throwing money into an idea with the hope of gaining positive results, which will rarely happen.
However, it is important to note in some instances you may need a budget to make sure you aren’t going over your expenses. But a good question might be – why are you wasting money on marketing that isn’t working?
If your marketing isn’t paying off then you will need to change things as soon as possible. You wouldn’t hire an employee and not measure their productivity or workload so why would you spend money on marketing that isn’t generating?
For example, if we were selling a £100 note for £50, would you buy as many as you could or would you limit yourself to what your budget allowed you? Our guess is that you would buy as many as you could, this scenario is the perfect example of why you should have an unlimited marketing budget.
When it comes to marketing, there are 3 types
One: Marketing that doesn’t work
Marketing that doesn’t work will ultimately lose your business money and if your marketing sadly falls into this category then please just stop.
However, if you are in the early stages of your marketing, then your ROI (Return on investment) may be low due to you being in the experimentation stage, which is different to “marketing that doesn’t work.”
Two: Marketing that isn’t measured
Like we said before you wouldn’t hire an employee without tracking their productivity or workload so why go through all the efforts of marketing and not measure your success or failure? We live in a digital world that provides lots of information and tools to measure your marketing.
Three: Marketing that works
Marketing that works and is being measured properly, the aim for every business to get to with their marketing making more money than it costs to have in place.
That type should be the end goal for all businesses.
When should I set up a marketing budget?
A good question to ask is when do I need to set a budget? Maybe you are new to business or you are considered a small business then you will need a budget for when you are in the testing phase. This ensures that you are spending a small amount for if your campaigns fail, you want to spend less until you find a winner.
You will want to test your headlines, what you are offering, maybe the position of your ad, and any other variables that come to mind. This will cut out the failing campaigns and make room for the winners that bring you the best possible return of investment (ROI.)
Once you have found the golden campaign that makes you more money than what it’s costing you then increase your marketing spend to gain an unlimited marketing budget.
But, how do I create an Unlimited Marketing Budget?
Now that you understand why an Unlimited Marketing Budget is important and when you should obtain one, the next stage is to implement the perfect strategy to increase your business profits.
First: Analyse
You will want to begin by completing a return of investment (ROI) analysis on all of your marketing platforms for example Social Media, Google Ads, Email Marketing, etc. You will need to divide the Life Time Value (LTV) by the Customer Acquisition Cost (CAC.)
This will enable you to see which channels are working and making you money to the ones where you are losing money.
Second: Reallocate Costs
Once you have completed your analysis, this will reveal some losers and some winners. You will want to take the costs from your biggest losers and reallocate these investments into the channels that are your biggest wins.
Third: Optimise
Now that you have allocated your losing marketing spend to your biggest winning channels, you may see some ROI dilution (as the number of potential buyers shrinks, so does the ROI.)
You may notice some opportunities to optimise, take these opportunities then test and experiment with different marketing tactics.
Deciding on what optimisations you do will all depend on the marketing channel, it is important you understand these channels to perform the best and optimal practices.
Fourth: Hire
If you are doing everything correctly, you will get to the stage where your marketing will outgrow your current environment, this means you are growing!
The next step is ideally to hire someone, someone who is a specialist in that field to help further grow your marketing. You can also consider a marketing agency who will specialise in the growth and optimisation of these channels.
Fifth: Re-diversify
If you have made it to step five then you should be proud of how far you’ve come! You started with a range of channels where you had some winners and some losers. You’ve analysed your marketing, reallocated investments from losing channels into your winners, whilst increasing your marketing spend and you have even hired someone to take on the extra work. Well done!
But what to do next?
What’s next, you ask? Well, now it’s time to go back to the drawing board and look at the channels you decided to cut previously. Is there any potential with these? What new channels can you learn and use to your full advantage? Can you do any extra experiments to increase your marketing? Can you create any new campaigns from the knowledge you have obtained?
If you follow these steps you will end up with an unlimited marketing budget that can lead your business into scalable growth.
But we can all agree that we run with the end goal instead of following the steps to get there. Take your time with each step and make sure you are making logical and practical decisions for your business.
For more information, please don’t hesitate to get in touch, and if you would like any extra reading check out our latest post all about “what you should include on a homepage.”
Thank you for reading, now go and create magic for your business!