The Cost of Marketing: Successful Marketing Channel Management
Tuesday, March 15, 2016
Having a proper marketing budget can make
or break your business - it's one of those facets of owning a company that is
absolutely crucial. This isn't an aspect of running your business where you
want to cut corners. Taking the time to consider the cost of marketing for your
company is something you'll want to take slowly and with a lot of careful planning and consideration. Let's take a look at a few very important points
to successfully dividing and evaluating your marketing budget.
First
Things First: Get Organized
Financial organization is the cornerstone
of marketing channel management. It's likely that you'll have to estimate your
projected future earnings and expenses, but try to be as accurate as possible.
Begin by having as crystal clear of an
understanding as possible regarding your net 30 (monthly) revenue. For example,
let's say that after expenses, your business earns anywhere from $10,000 to
$15,000 monthly - what you're trying to determine here is your reliable revenue, which is the term for
the funds that you can expect to bring in each and every month.
To determine your reliable revenue,
you'll want to use the lowest possible figure. So in this example, that would
be $10,000. Anything you happen to earn over that amount becomes additional
revenue which can be allocated at the time, but not before.
Think of this as starting your budget
from a "worst case scenario" position. If you're uncertain when
calculating your monthly expenses or mezzanine debt rates, tools like a monthly
budget calculator or the help of a financial manager can be very useful.
Deciding
Which Marketing Channels to Utilize
Even if you can successfully apply for
loan, you'll want to allocate your funds based on the figures you determined in
the first step we discussed here. You'll first want to figure out where and how
you'd like to spend your marketing budget.
There are usually three considerations
successful business owners make before spending their marketing budget:
● The size of his or
her budget
● Where and how the
target demographic will be reached (i.e., which marketing channels
● Past experience and
expertise
For example, even with the best
construction loan, a building company should take these points into
consideration. Organizing your marketing budget will likely begin with
considering just how much money you have to spend - if your budget is quite
small, you'll want to consider relatively inexpensive options like email
advertising and lead generation, online advertising, creating a strong social
media presence (which can be quite cost effective and, in many cases, cost
nothing at all), and even reasonably priced print advertisements.
If your marketing budget is larger, you
may also wish to consider marketing channels such as television, radio, or
other forms of targeted media. Don't be afraid to find and use a marketing
budget template to use as a helpful reference as you work out the details.
Knowing
Your Target Demographic
In order to determine the best marketingchannels for your specific needs, the best place to start is to develop a
demographic profile of your target audience. Begin by considering some of the
following points of your target audience:
● Gender
● Age
● Income level
● Interests, hobbies,
and behaviors
● What kind of media
they are most likely to consume
The last point is perhaps the most
important and often the most difficult to accurately determine, however this
will likely shed quite a lot of light on which marketing channels you should be
using. Once you know where the eyeballs of your target audience are the most
likely to be, you can begin working on developing your integrated marketing
communications.
Test,
Test, Test
A portion of your marketing budget should
be allocated to testing. This should only be money that you can "afford to
lose" - however, don't think of losing money on a failed marketing
campaign as a hard loss. This is money you spent to gather data - you paid to
find out what did and did not work.
If you haven't already, familiarize
yourself with split and/or A/B style testing. This means that you'll develop
multiple versions of each advertising campaign and test to see which works
better. A/B testing involves two versions (A and B). If campaign B yields you a
higher return on your investment, it's the "winner" and gets pitted
against another variation of the same ad. This process repeats so that you are
continually optimizing your marketing channels.
Analyze
Data and Adjust Accordingly
The final step to finding the optimal
marketing channels for your business is to take all of the data that you've
gathered from your tests and analyze it. Ruthlessly cut out the channels that
failed and optimize the ones which were successful. By repeating this process
over and over, you'll eventually reach a point of peak marketing channel
efficiency.
Marketing
Channel Management is an Ongoing Process
Understand that marketing channel
management is often an ongoing process that will need to be adjusted over time.
Trends, shopping habits, and audiences themselves will change over the span of
years and sometimes even months, so it is necessary to continually develop new
marketing strategies and test new channels. As your audience changes, so should
you.
About the Author
: This article
was written by Tully with the help of HoldenCAPITAL, a specialist construction finance group
in QLD, recognized as a market leader through its successes in deal structuring
and the sourcing of debt and equity solutions.
Marketing Blog founder and top-selling author Michael Fleischner has been featured on The TODAY Show, ABC World News, and Bloomerg Radio. 
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