One of the major issues that every business and marketer has to deal with is the continual challenge of trying to maximize revenue while maintaining a healthy bottom line.

It’s an extremely tough thing to do, and for many, it feels like a win-win scenario never happens. Nevertheless, implementing and following a marketing and sales budget can help businesses of all sizes and budgets remain profitable and successful.

What exactly is a marketing and sales budget and how does it work?

What Is a Marketing And Sales Budget?

A marketing and sales budget is simply the sum of all of the money that an organization is willing to spend on marketing and sales activity during a specific period. This can include advertising, content creation, email marketing, social media marketing, events, and more.

The main difference between a marketing and sales budget and a traditional marketing plan is in the fact that the former sets a limit on how much money can be spent. For instance, you might decide that you will only spend a set amount of money per month on marketing and sales activities. This prevents you from overspending and helps you keep track of how much you’re spending. You can also set a target figure for the year. Something to keep in mind is that this is a spending document and not a revenue document, so you need to ensure that you’re not eating into your bottom line. This is why a marketing and sales budget is also known as a ‘spending plan’.

Why Do You Need a Marketing And Sales Budget?

One of the main reasons why you need to budget for marketing and sales is because these are functions that can help you determine how much money you should be spending on. For example, you might want to set a budget of $500 for content creation this year. Now, you might initially assume that you will simply write an overview of all the important news and trends that you discover during the year and will use some infographics or fun facts to make your content more compelling. Yet, this might not be enough to attract and retain the attention of your target audience.

Instead, you could opt to create a digital marketing campaign, which includes online marketing (e.g. SEO, content marketing, social media), offline marketing (e.g. billboards, flyers, radio ads), and email marketing. You can get a general idea of how much these types of activities cost by referring to some of the best digital marketing agencies in town. Alternatively, you can use a tool such as HubSpot to track your marketing spend and outcomes.

Now, if we were to calculate the average cost per day for a beginner content marketer, it would be somewhere around $500 per month. For a more experienced content marketer, it would be a bit higher. In other words, if you’re looking to hire a content marketer, you should budget to pay them around $500 per month, plus benefits.

On the other hand, if you decide that you will conduct all of your marketing and sales activities yourself, apart from possibly hiring a content marketer to create some materials for you, then you don’t need to bother with a marketing budget.

How to Create a Marketing And Sales Budget

If you decide to go the DIY route and conduct all of your marketing and sales activities yourself, apart from possibly hiring a content marketer to create some materials for you, then you’ll need to set some time aside to create a marketing and sales budget. This is especially important if you want to set a specific marketing budget for the upcoming year. Otherwise, it might be difficult to determine how much you’re actually spending on.

To start, you’ll need to work out how much you need to spend on. For example, you might want to set a marketing budget of $500 per month, but you’ll need to determine how much you’re actually spending each month. You can use a tool like Budgetsaurus to help you keep track of your monthly spending. Once you’ve set your marketing budget, you can move on to the next step.

The next step is to work out your planned marketing activities for the upcoming year. To create a truly effective marketing and sales budget, you need to examine how each of your planned marketing activities will contribute to your ultimate goal of increasing revenue and customer growth. Once you’ve set your marketing plan in motion, you need to assess the results and gauge whether you’ve hit your target or not. This will require some time to carefully analyze the performance of your marketing activities and optimize the process if necessary. In the meantime, you can use the budget to track your progress and determine whether you need to alter your strategy to increase your chances of reaching your goals.

Marketing Budgets and Strategy

Setting a marketing and sales budget doesn’t mean that you need to completely alter your strategy for the year. Instead, it just means that you’ll have to adhere to certain guidelines that you’ve set for yourself. Keep in mind that a marketing budget is only as good as the strategy that you implement. Without a sound strategy, it’s all too easy for your budget to be wasted on activities that don’t contribute to the success of your business.

For example, let’s say that you’ve decided to set a budget of $500 per month for content creation this year. This might mean that you’ll need to forgo writing some articles for local businesses as part of your organic SEO strategy. Nevertheless, you might decide that this is a worthwhile tradeoff to make given that this will help you develop your personal brand and effectively place yourself in the role of an authority in your industry. In this case, the strategy would be deemed a success as you’ve reached your target goal of acquiring five blog articles per week.

On the opposite end of the spectrum, let’s say that you’ve decided to set a budget of $1,000 per month for content creation this year. This might mean that you’ll need to completely rethink your content strategy, potentially creating some content that was not part of your original plan. Alternatively, you might want to hire a copywriter to create some high-quality, keyword-rich content for you. In this case, the strategy would be deemed a failure since you’ve set a target goal of increasing web traffic through organic SEO and content marketing activities by 25%.

As you can see, setting a marketing and sales budget can be challenging, but notifying your team of your planned strategy can help them be more productive and successful. This, in turn, can help you reach your goals and stay sustainable.