For small or local businesses, marketing strategies are essential to getting your brand recognised and your product sold. There is plenty you can do for yourself, but any small business marketing strategy is likely to cost you. Content marketing, social media strategy and online advertising can be pivotal parts of reaching your target audience, but how much can you actually afford to spend? And how much should you be spending compared to other small business’s marketing efforts? Read on to find out.
The average marketing budget by industry
A lot of larger companies outsource their social media posts, email marketing and other marketing initiatives to a marketing agency in order to save time and ensure the best results. Others may keep the work in house or minimise spending on marketing in other ways. To give you a better idea of how much you could end up spending, here are a few of the average marketing budgets by industry:
Retail
On average, the retail sector spends 6% of their overall budget on marketing.
Education
The education sector tends to invest around 3% of their budget in marketing activities.
Technology
Companies operating in the tech industry are likely to allocate 8% of their total budget towards marketing efforts.
Healthcare
Healthcare providers tend to have a slightly higher marketing budget of around 10%.
Restaurants
Restaurants invest around 11% of their overall budget in marketing activities.
Financial Services
Banks and other financial service providers can expect to spend 7% of their total budget on marketing.
Of course, while these figures can help to give you a rough guide, there are a lot of factors involved in deciding your budget. Some of the most important include how larger your overall budget is, the size of your company, and how quickly you need to grow you audience.
If reaching new customers is your priority, then spending more on marketing initially is a good idea. You can scale this back once you have a better client base to work with. So, how much should you be spending as a smaller business looking at building a client base from scratch?
More competition
The popularity of digital marketing also means more competition from similar businesses, making it harder for business owners to stand out in the crowd. Additionally, search engines are constantly adapting their algorithms which can make it difficult to maintain high rankings. This can be a concern if it is something you aren’t used to.
How much does advertising cost for small businesses per month?
From video marketing and market research to running ad campaigns, the costs can quickly stack up. So, how much should advertising cost for a small business looking to reach out to a wider audience?
The costs will vary greatly depending on the type of content you want to create and the size of your budget, but research suggests that small businesses should allocate around 5-8% of their total budget towards marketing efforts. For example, this works out at around £150-£250 per month for a small business with an annual budget of £12,000.
Small business marketing budget essentials
To get the best value for your money, it’s important to focus on quality content that engages your audience and offers a real return on investment. Content marketing, email marketing and running targeted social media campaigns are all great ways of achieving this.
Overall, you should aim to spend enough to get noticed without breaking the bank. With careful budgeting and thought-out marketing plans you should be able to reach the right people, so it can be beneficial to dedicate a larger section of you budget towards marketing to help your brand grow.
It’s always a good idea to review your digital marketing budget periodically and ensure it remains in line with your goals. Taking a strategic approach to advertising and content creation will help you to save money while still reaching out to prospective customers. The best way to avoid wasting time and money is to dedicate this task to professional with experience in the area so that you can be sure you will get returns on your spending.
How much can you afford to spend?
For all small business owners, keeping your spending limited is important. For the majority of failed start ups, lack of funding and money problems are the main cause of failure. However, the only way to get your product out there and find a client base who can start to help your company find its feet is to use marketing. There are still ways to minimise on spending, but one of the best options is to work with experts who can ensure you are getting the results and who know the trade well enough to help you grow as quickly as possible.
Getting value for money
Here at Roku, we specialise in long term strategies, SEO, and online marketing content. This includes reworking your website, brand voice, social media platforms and more in order to connect you with potential customers who are engaged and ready to spend. So, to launch your small business on the front foot, get in touch with us for a free consultation on what we can do for your business.
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