The rumor on the internet is 95% of diets fail and most small businesses fail to have a marketing budget. Strangely, the reasons diets fail are eerily close to the reasons businesses fail in their marketing. Local experts, Erica Pefferman, President of The Business Times Company and Mark Mils of Cumulus Media tell us why.
It’s unrealistic to lose 20 lbs in a day and it’s just as unrealistic to grow your company by 50% without adjusting your marketing budget. “Your goals and your budget need to be inline,” explained Erica.“If you have aggressive goals and the same budget as last year the campaign won’t be a success.”
Mark agrees, “There is a minimum on any medium, be it traditional or new, and if you can’t afford to reach the minimum, then you need to rethink the entire plan. Don’t spend a little bit just to spend a little bit.”
Expectations are probably the most important conversation an advertiser and a consultant can have. There may not be a specific ROI but there will be an expectation of some things happening. It’s important everyone is on the same page.
Fads come and go but the principle remains the same: plan to eat right, exercise more, lose weight. Your dietary plan is based on your caloric burn. The same applies to marketing: plan your marketing, complete your activities, increase sales. Your marketing budget is based on how fast you want to grow your company.
“Some businesses plan for 3-5% of gross sales as their advertising budget while others invest far more. A commonly made mistake is to take 5% of your current revenue. The budget needs to be 5% of where you want to be, not where you are now,”advised Erica.
Mark often deals with a 3-12% advertising budget based on total revenue. He also sees business owners look at the income and expenses of running the business and take a percentage of the remainder for their advertising budget. “There’s no magic specific formula for budgeting. In fact if a business has a budget they’re 4-5 steps ahead of their competitors already,” shared Mark.
Seems like everyone starts their diet on the same day, tomorrow, because nobody wants to give anything up, they want it all, while successful dieters tackle weight loss in stages, establishing a permanent lifestyle change one glass of water at a time. Erica affirmed, “The biggest problem is businesses try to do too many things with too little budget. It’s easy to do to little or too much. Concentrate and dominate.”
Mark helps people understand the Bucket Theory, “You have several different buckets representing advertising opportunities. Pick a few buckets and fill them as full you can instead of putting a little in each.”
Your marketing plan will vary based on your budget. “If you don’t have very much money to spend you may have to invest your time and choose marketing activities you can do on your own,” explained Erica. “If you have money but not much time to invest you can look at mediums that require a bigger monetary investment but little time. If you can’t make equation work either way your goals may not be realistic.”
Giving up dessert today doesn’t mean you’ll fit into your college pants tomorrow. In the marketing world, “Running an ad and expecting customers walk through the door immediately isn’t a realistic expectation,” explained Mark.
“The most important part of marketing is to be consistent. Not advertising for just for a month or 3 months,” clarified Mark. “The best advertisers run 52 weeks per year, they’re out there as frequently as their budget allows and doing it consistently.”
Erica related a ‘social experiment’ conducted by a past client of hers who intentionally canceled all of his traditional marketing. “He did well for a while but then sales started to drop off and he realized he needed to bring it back. But he had to build sales back up to where it was before, it didn’t just jump back as soon as he started advertising again,” Erica shared.
A Fitbit is a minimal investment to track your fitness goals in comparison to the money you’re spending in your businesses marketing budget. Yet many businesses don’t track their marketing.
When tracking a campaigns success Mark says setting expectations is the most important conversation an advertiser and a client can have. “Even if there is not a specific ROI there should be an expectation of things happening. It’s important everyone is on the same page. It’s a marathon not a sprint,” offered Mark.
Erica is adamant about tracking, “If you’re not tracking it, you’re wasting it,” she emphasized.
Don’t be a statistic, tackle your goals by setting a realistic marketing plan and budget. Focus on a few core mediums that meet your target market and do them well. Then sit back and work your plan, track, tweak and grow.