A Smart Marketing Budget Is the Most Important Things You Can Do for Your Company. So Why Are So Many Small Businesses Scared of It?

A man with a very successful small business recently called me up to tell me that he was ready to take his business to the next level. I ask him what that meant; he responded that he wanted more. I continued to probe, asking him what “more” was. He told me I asked good questions. Then he started to describe his business. He explained that he wanted to get more clients who could spend more money with him, and that he wanted to do it in a profitable way.

Now the conversation was beginning to get productive, because we were talking about a well-defined objective. But all that came to a screeching halt the moment I mentioned that evil word: budget. Budget is a word that most small business owners hate to hear. Even executives at some midsize companies squirm when they hear “What is your budget?”

How can a business run without a marketing budget? There is a mentality out there that if you have a budget you will end up just wasting it, because once you define how much money you are going to spend, it’s as if you had already spent it. But that couldn’t be further than the truth.
Creating an intelligent budget is the most important thing you can do for your business. It’s probably more important than figuring out how to spend it, especially when it comes to marketing. One of the reasons I love digital marketing so much is that it is highly measurable. You can measure exactly what part of your budget is working and what part isn’t, and then adjust the numbers accordingly.

Here are five questions you need to ask yourself before creating a marketing budget for your small business.

What are my needs? Do you need more leads, more sales, more brand awareness? Your goals will help determine where your money should go. For example, if you need to generate leads this month and you start off with an SEO campaign, you’re probably headed down the wrong path. If you want to create long-term brand awareness and you start off with an aggressive Google Ad Words campaign without setting it up right, you might fail.

Once you identify your needs, you will be closer to identifying a budget. Let’s say you have a business that lends money to restaurants. You are after leads that close in 90 days or less that generate loans of $5,000 each. That is a well-defined need.