Drafting the correct digital marketing budget raises key questions among business owners and marketing departments. Sometimes these two groups go head-on about the money needed. One thing is for sure though biz owners - companies that win business invest a lot in sales and marketing. So what is a quick sample marketing budget template we can keep in our mind for how much we should be spending on customers?'
Sample Marketing Budget Template
Let's start with the basics. Revenue comes from two sources: existing customers and new customers. Therefore, your sales goal for the year will be the sum of new purchases from the customers you already have, plus the extras you get from selling to new customers.
For example, if your sales goal for this year is $500,000 and your current clients represent $380,000, this means you must sell $120,000 to new customers. If your average customer purchases $10,000 from you that means you need to get 12 new customers! Easy, right?
Okay, now let's discuss how to make sure you're allocating the new customer marketing budget properly.
1) Marketing Budget Allocation for current customers
Check how much have you spent in the past for them to get you those $380,000 in sales. Did you have a CRM program or marketing automation software to help acquire them? Did you send them birthday gifts? This should all be considered. Suppose you invested $5,000 last year to maintain these customers in marketing costs (not including the costs to perform any work for them). That's the number you should continue investing on current customers.
2) Marketing Budget Allocation for new customers
In the example, we determined that we needed 12 new clients with an average purchase of $10,000 to reach our sales target. So, in order to understand how much money you should allocate to get them, you need to check your finances. If you spent $3,000 in marketing last year and scored two new customers, then you know your price per customer is $1,500. So if you need 12 new clients, you'll need to invest $1,500 x 12. This means a budget allocation of $18,000. You need to be careful and you can actually drive your marketing budget for new customers down by adding a personal touch to your business development process. Remember, the best things in life are free or don't cost too much. Get to know potential customers, target them and their likes/dislikes and recruit them to be your customers.
Yes, this is very simple, but it is a great way to calculate the reality of your business. Keep refining and modifying to drive-down that customer acquisition cost to be as low as possible!
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