2019 is quickly approaching and with a new year on the horizon, it's time to start planning your budget allocation for your marketing team. While your marketing budget is dependent on your specific company, we have compiled a list of the most important factors in your yearly budget, so you're fully prepared to crush 2019 on the very first day of Q1.
The first thing to consider when planning your budget for next year is your personnel expenses. While we love our jobs as marketers, we also love getting paid to do those jobs. Your personnel expenses are exactly what they sound like: the expenses you will pay your people to work for you. This doesn't stop at their salary. Personnel expenses should also take into account any employee benefits your company provides. Some common ones might include:
- Paid Time Off (PTO)
- Health Insurance
- Dental Insurance
- Vision Insurance
- Retirement Expenses
Benefits sometimes get overlooked in marketing budgets because they are a less obvious payment your company makes to employees than an actual salary. But they are extremely important to keep in mind, because they quickly add up once your employees start reaping their rewards.
In essence, your channel expenses are a subset of your personnel expenses. These expenses pay for the different channels you leverage when marketing for your company. At New Breed some of our top channels we consider when creating our budget are: SEO, paid advertising, our blog, email and our chatbot. To find out how much you want to allocate to your channel budget, ask yourself:
- How do we want to market to people?
- How much time do we need to devote to managing each channel?
- What trends are going to be important for us to capitalize on in the new year?
- How should we budget for these trends?
Asking these questions, and analyzing your historical data to determine which channels have been the most lucrative for your company in the past, will help you determine how much money to budget for each channel in the future.
The next expenses to take into consideration when planning your budget are your branding expenses. These expenses are any type of swag you can hand to someone that represents your brand. It might also include any digital assets your company leverages in your branding strategy. Some examples of branding expenses we use here at New Breed include:
- Business cards
These are just a few examples of some great ways your company can advertise to potential clients. Branding expenses are an important component of gaining recognition from your buyer personas and must be included in your budget.
With the growing use of technology (and the fact that we work in the SaaS industry of course), it's no surprise that software expenses are at the top of our list for most important expenses to consider when planning your marketing budget for the new year. Think about all of the different areas in which you are leveraging software to perform an operational function of your business. At New Breed, we budget for everything, from our reporting software, InsightSquared, to our graphic design software, Sketch. Write out a list of all the different areas of your business that utilize some form of software. This list might look like:
- CRM software
- Marketing automation software
- Sales acceleration tools
- Reporting/business Intelligence tools
- Project management tools
- Video tools
- Graphic design tools
- SEO/SEM tools
- Email tools
- Analytics tool
Once you have an established list of all the different areas of your business using software, hone in on the exact price each software will cost you over the course of the year.
Public Relations Expenses
The next area of focus for your marketing budget is your public relations. These expenses would include press kits, news coverage or basically any costs associated with gaining exposure for your company. While both contribute to your overall brand awareness, your public relations budget is not to be confused with your advertising budget. Public relations involves creating strategic plans to enhance how others will promote you to the public, while in advertising, you determine how you are going to promote your brand to the public.
Budgeting for events can get lost in translation when marketing executives are planning for the upcoming year. Whether for an industry conference that is a good opportunity for networking, or something as simple as your company Christmas party, event costs can add up.
Consider the types of events you will be attending. For example, there are events that your company hosts, and there are events you attend. We highly recommend making it a priority to go to events held by different companies, because they are a great way to meet new people, learn new marketing trends and generate further client interaction.
We recently attended HubSpot's annual INBOUND conference and came back totally inspired by all the awesome people and ideas we witnessed while there. But how do you know which events are worth your time and money? Here are some questions to ask when evaluating what events you should go to:
- Is the event relevant to your business?
- Is the event relevant to your customers?
- Is the event relevant to your prospects?
If your answers to these three questions are yes, then it is probably worth the investment. But there are some things to keep in mind outside of the event cost alone. Don't forget to include the following in your budget allocation:
- Travel expenses: Food, venue and gas expenses.
- Event staff: Paying those working for you at the event.
- Event speakers: Keynote speakers who take the stage to represent your company at the event.
- Signage/branding: Examples might include co-branding for partnerships.
- Employee burden time: This refers to the money you lose from the hours your employee is not able to do their actual work while you are at an event.
- Emergency fund: You should always have some money set aside in case an emergency occurs while at your event.
While the cost of events do add up, we encourage you to find ones that would be valuable for your company to attend; they are a great way to build your contact database and generate revenue for your company.
It may seem like a tedious and time-consuming task, but budgeting enables your company to better understand if you are spending your money in the right places and putting your emphasis in the right areas. Creating a budget and forcing yourself to monitor your spending will help you understand how you're allocating your time, reduce expenses in unnecessary areas, streamline efficiency and measure the success of your marketing initiatives (ROI). Budgeting also allows you to be more nimble when those unexpected last minute expenses come up, because you will already know what you can and can't afford — without having to go through finance or HR.
We know that creating a budget for your marketing initiatives is not the most exciting thing to do, but it is certainly one of the most important. So if you haven't already looked into your expenses for the upcoming year, it's definitely time to start!