As media strategist and buyers, we’re asked a lot of questions about how to plan and buy media, along with related topics. Budget is a subject that often arises – specifically, how much to spend in a year, or where to start when building a budget for the first time.
It’s typical for a growing brand to have such questions when dipping its toe in the water of marketing for the first time. Actually, given how complex the media scene has become, it’s even common for seasoned marketing brands to have these conversations. The truth is, there is no easy, one-size-fits-all answer to such a complex question. Fortunately, there are a few schools of thought that help simplify the process, which I’ll outline here.
Goals Based Budgeting
When adopting this approach, the most important place to start is with the finish line. That is, what is the brand trying to accomplish? Your brand’s goal may be to sell brunch or to put heads in beds. But how many? And equally important, at what cost? Be realistic here in terms of expectation and capacity. Can you really handle doubling sales? Do you have enough inventory?
If the goal is something tangible, like selling a product or bringing on new clients, a budgeting exercise is fairly straightforward. Just multiply the number of new clients by the amount of money you’re willing to spend to get them on board. That provides a ballpark budget to start with. It’s a good practice to compare your figures with those of your industry. A few minutes on an industry association’s website should shed light on trends and figures pertaining to this subject.
With this method, you might have to adjust the budget up or down depending on where you plan to spend the budget. Some media tactics require a larger investment than others. So do not hesitate to make tweaks as you see fit.
Tactics Based Budgeting
Although not as popular as Goals Based Budgeting, using tactics to arrive at an ideal budget is another approach. To do this, determine what media tactics you want to use in your marketing endeavors. Want to own TV? That will cost X. Want to have a significant digital media presence and remarketing effort? Cough up Y. Obviously, it helps to know how much various media cost and the sufficient level for your brand (in light of the market, audience and competition). These are all things that an experienced media strategist or buyer can help determine.
I do have one piece of advice when building from a Tactics Based Budget. At Morgan & Co., we always tell our clients that if you’re going to get involved with a media tactic – whether it be out of home, digital or TV – own it. Do it to a level where you make a mark. You stand out and apart from the herd and walk away having made an impact on your ideal audience. If that means you can only employ one or two tactics, fine. Do them, and do them well.
Designing the right media budget and strategy for your brand is a challenge. But it’s not impossible to overcome with the right help. At Morgan & Co., our media strategists and buyers have the knowledge and experience to help brands build and execute the correct media budgets. If your brand is in need of a budget refresh, reach out to us. We’d love to talk.