Marketing Budgeting: Allocating Resources for the Year Ahead


When it comes to running a small business, allocating your marketing budget is a bit like planning a road trip. You’ve got your destination in mind – growing your business – but you need a map to get there. The Marketing budget is the fuel. It’s a crucial part of your journey, and without it, you might end up taking some wrong turns or running out of gas halfway there.

Understanding Your Marketing Goals

Imagine you’re the owner of ‘Sunny’s Sandwich Shop,’ a small but charming eatery in the heart of the city. Your goal for the year might be to increase foot traffic by 20%. This goal is your North Star, guiding every decision you make regarding your budget.

Assessing Past Performance

Before you start allocating your funds, take a look in the rearview mirror. What worked last year? Maybe your social media ads brought in more young customers, or the local radio ad got people talking. Identifying what worked and what didn’t is like checking your car’s performance before a long trip. It ensures you don’t spend on things that don’t move you forward.

Determining Your Budget

There’s no one-size-fits-all answer to how much you should spend. A common rule of thumb is to allocate around 7-8% of your gross revenue to marketing if you’re doing under $5 million a year in sales. But, it’s more about what’s right for ‘Sunny’s Sandwich Shop’ than following a general rule. Start with what you can afford, and remember, marketing is an investment, not just an expense.

Allocating Your Budget

Now, let’s provide an example of break down this budget. (This is just an example –These allocations should based on your industry, business goals and stage of your business journey) 

  1. Digital Marketing (40%): Given that more people are online than ever, investing in digital marketing is like having a fuel-efficient car – it gets you further on less. This includes social media ads, email marketing, and maybe revamping your website.
  2. Local Advertising (30%): Don’t forget the power of local presence. Allocating a part of your budget for local newspapers, radio spots, or sponsoring a little league team can make a significant impact.
  3. In-Store Promotions (20%): Allocate funds for in-store promotions like special weekend discounts or a sandwich of the month. These are like the snacks for your road trip – they keep things interesting and engaging.
  4. Unexpected Opportunities (10%): Always keep a small part of your budget for unforeseen opportunities. Maybe there’s a local festival where you could set up a stall, or a chance to partner with another local business.

Tracking and Adjusting

Your journey isn’t over once you set your budget. Keep an eye on your ‘marketing fuel gauge.’ Are your digital ads not performing as expected? Maybe it’s time to reroute some funds into local advertising. Regularly reviewing your marketing efforts is like checking your GPS – it keeps you on the right path.


Remember, budgeting for marketing isn’t always about spending big bucks; it’s about spending smart. Every dollar should have a purpose and a direction. As a small business, like ‘Sunny’s Sandwich Shop,’ your agility is your advantage. You can make quick turns and adjustments as needed, something the big rigs can’t do as easily.

At the end of the day, your marketing budget is your roadmap to success. Plan it well, review it often, and be ready to adapt. Safe travels on your business journey

Tags :

Share this :


Leave a Reply

Your email address will not be published. Required fields are marked *