As we approach the beginning of a new year, many of us will make our annual pledge to improve ourselves by engaging in certain changes. Yet, out of the 45% of Americans who make a New Year’s resolution, only 8% will actually fulfill the goals set for themselves. This is likely due to the fact that we approach that 30 pounds we want to lose or that $10,000 debt we want to reduce without a plan for how we will actually accomplish the goal.
While business owners want to see the bottom line grow instead of shrink, they sometimes approach their businesses the same way most of us approach our resolutions. Without realistic and measurable goals, business owners can find themselves running in place, not knowing how they will hold on to current customers while attracting new customers, increase margins while decreasing expenses, and ultimately how they will grow business. Statistic Brain Research Institute sites lack of planning as one of the number one causes of business failure.
According to the Small Business Association (SBA) “A marketing plan includes everything from understanding your target market and your competitive position in that market, to how you intend to reach that market (your promotional tactics) and differentiate yourself from your competition in order to make a sale.” Most importantly, the marketing budget must be defined, as it outlines how the goals of your marketing plan will be achieved.
Jamie Turner, the CEO of the 60 Second Marketer and 60 Second Communications, utilizes the concept of “marketing-to-sales ratio” to launch discussions of marketing budget. In his blog, “How Much Should You be Spending on Marketing? We Have the Answer.” Turner provides the example of a company generating $100 million in revenues (for easy math) setting their marketing budget at $5 million. This ratio results in a marketing spend that is 20-to-1 or 5% of revenues. Turner references several industry examples of the marketing-to-sales ratio in his article. Your industry trade association can provide you with similar references relevant to your particular business category.
The budget may be an important aspect of the marketing plan but it is only the first step. Consider consulting a subject area expert – visit the SBA Learning Center for a host of information on getting your business in shape. If a marketing plan seems like a daunting task, try approaching it in the same way you would when making a New Year’s resolution, simply start by examining where you are today and determining where you want to be tomorrow.
Manning Media employs a team of marketing experts with experience in all areas of advertising who can provide you with information vital to creating an accurate marketing plan for 2016 and beyond, including ad-to-spend ratios specific to your industry. In Frederick, Call 301-620-7700 or in Hagerstown, Call 301-733-4500 or fill out our online request form for more information.
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