Marketing Budget Calculator
One of the most common questions our team of web marketing experts gets asked is
“How much should I spend on marketing? “
Unfortunately, there’s no one-size-fits-all answer to this question.
Your marketing budget will depend on a number of factors, including the size of your business,your industry,your marketing goals and more.
That’s why we created this marketing budget calculator. Just enter a few details about your business.
Why You Need a Marketing Budget
Before we dive into the marketing budget calculator, let’s briefly talk about why you need a marketing budget in the first place.
A marketing budget is important for several reasons:
It forces you to think about your marketing goals and objectives.
It ensures that you have the resources necessary to reach your target audience.
It allows you to track your marketing progress and ROI.
It helps you make informed decisions about where to allocate your marketing resources.
How to Use the Marketing Budget Calculator
Now that you know why you need a marketing budget, let’s talk about how marketing budget benchmarks and why they help you have realistic expectations – remember that your competitors are investing in marketing too
and could very well be outspending you!
How to Calculate Your Marketing Budget
Calculating your marketing requires that you have a good understanding of your business key financial data in addition to you overall growth and marketing goals.
Here are numbers that we recommend knowing to determine your marketing budget:
Annual revenue
Annual revenue growth goal
Number of current and needed customers to hit growth goal
Customer churn (the number of customers that you lose on monthly or annual basis)
Percentage of Total
Marketing spend over Revenue
Annual profitability goal
Additional metrics that should help you guide how much you can afford to invest are your current customer annual value, average client tenure, and customer acquisition cost. This will give you a sense of how much a customer is worth as well as how long it may take you to recover your initial invest.
Align Your Marketing Goals & Budget
Setting marketing goals will depend on the above metrics. After all, you are trying to calculate how much it will cost to reach your goals.
For example, if you know that you need an additional 24 customers and it costs you $2,500 to acquire a customer that pays you $15,000 per year, you need to plan to spend $60,000 over the next year to acquire those additional customers.
You also know that if you hit these goals, you’ll add $360,000 in revenue to the company off just $60k in spend. When looked at it that way, as an investment into company growth, that $60,000 (or $5,000 per month) isn’t such a big expense.
What the example above illustrates is that you really need to know your company’s numbers. Without understanding the value of a customer to your business, you may either end up overspending or cutting yourself short and not reaching your growth goals.
Use a Marketing Budget Calculator
Now that we’ve gone over how to calculate and set your marketing budget, it’s time to put those numbers into a marketing budget calculator.
Need Help?
If you’re the owner of a small or growing business and want to find out the right marketing marketing channel, check our
Google Audit service
.
If you work for a web or marketing agency looking to scale your business more cost-effectively, learn more about our
White Label programs
.
Want to explore more calculators? Check out our Website Cost CalculatorDivider
For more hands-on help from the Pronto team, book a free meetingwith a Pronto advisor.
Marketing Budget Calculator Tool
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