When you are starting your own business, it can often be tricky to know how to divide your time and your budget most effectively to deal with each of the different aspects of successfully running a company. One of the most important aspects to consider is marketing.
How much of your time to invest in marketing
When you are first starting your business and have not yet built brand awareness, marketing is one of the most essential ways to spend your time. When you start out, you are likely to have significantly more time than you have money to spend, especially if you have not yet built a customer/client base. During these early stages, you may even be able to spend the majority of your time on marketing (as long as you do not neglect other vital aspects of running a business).
This time can be taken to try out different marketing techniques and channels, choose your brand personality, and generally work out what works best for you. Once you have set up reliable marketing channels, the time needed to spend on marketing can decrease, but you will still need to regularly update and monitor channels such as social media accounts. As you gain more business, time spent on marketing can likely be reduced, usually to somewhere between 10% and 20% of your total weekly working hours. As time spent is reduced, financial investment in things like paid ads can likely increase.
How much of your budget to invest in marketing
There are many expenses associated with starting your own business. For example, if you are starting a business in the state of Florida, you are legally required by the government to have workers compensation insurance if you employ four or more members of staff, and/or if your business is in the construction sector.
Deciding what percentage of your business’ budget to invest in marketing can depend on what sector your business is a part of. Not only do certain sectors have fewer expenses than others, but taking an active approach to marketing is also more essential in some sectors than in others (although some marketing is vital in all sectors). Businesses in sectors such as banking, transportation, and energy have on average some of the lowest percentages of their budgets spent on marketing (usually less than 10%), whereas consumer goods providers spend around a quarter of their budget on marketing.
If you are not sure how much of your budget to allocate, a good general rule-of-thumb recommended by business experts is to aim for approximately 10% if you are looking to grow your business, although this can be reduced to around 5% if you just want to simply maintain your current level of brand visibility. When starting out and aiming to get clients/customers, marketing will be more important and worth more funding than later on when you have a consistent client/customer base. Of course, the specific percentage of your budget will also depend on your sector and overheads.
How data analytics can help you
Using data analytics can help you to identify the most profitable marketing channels for your business, which can make your time and your financial investments more efficient in future.
Being adaptable to changing circumstances and regularly revising your marketing budget, strategy, and timetable can help you to create improved ROIs on your marketing activities.