4 Tips on How to Effectively Use Marketing Budget

There is no shortage of marketing tactics and products you can invest in as a small business. However, not all are created equal. Your business is unique, and you know you need to pick the right media mix for your business for optimal results. If you’re investing a budget in marketing, you naturally want to find the right marketing tactic that will produce a return on your ad spend. However, this is all easier said than done. Many marketers and small business owners, unfortunately, just don’t know how to use their marketing budget effectively.

JSL Marketing & Web Design, an award-winning Dallas marketing agency, is here to unveil our tips on how to use a marketing budget effectively. These are merely overarching rules, and we encourage you to think through your specific business when applying these rules to efficient marketing budgeting.

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Know Your Audience

This is Marketing 101. The more you understand your audience, the better you can be prescriptive with your marketing efforts. Market research is often one of the first things cut when a small business is looking to be cost-effective. Obviously, limited resources can only go so far, but we encourage you to attempt still to understand your audience. Assuming what has always worked will continue to do so isn’t great marketing.

For instance, let’s say you sell vintage movie posters and are interested in running some substantial Tik Tok ad budgets. However, after some research into your audience, you learn that 70% of your sales come from people over 40. This might suggest that Facebook and Instagram ad budgets will be a better use of your budget since the audiences of these social platforms skew higher than Tik Tok. Without a line of sight into who your audience truly is, you’d have used your budget inefficiently. Knowledge is power, and knowing your audience is one of the most powerful tidbits of info for a business.

Understand What Will See ROI….

Aligning goals with marketing tactics is a great place to start. If you want to run display ads, but your main key performance indicator is sales, you have a problem. Display advertising is a great way to raise brand awareness, but it’s not a great tactic for closing sales. Something like Google Ads, TikTok, or social media ads would be a better fit in this regard.

Likewise, if you want to achieve ROI without putting dollars into paid media, search engine optimization (SEO is a great tool for a business looking to see a great return on investment. The reason is simple. Good SEO is usually quite affordable and nets a great return. The downside is that SEO can take a few months to produce results, but if you’re a business with a strategy and time, this could be a good route. If you are in a situation where you need to drive results fast, then paid advertising is the name of the game. Regardless of the use case, think through what each media tactic is supposed to do and plan accordingly.

Without Neglecting Brand Awareness

It can be easy for businesses to decide that Return on Investment is the most important part of their marketing strategy and plan accordingly. However, this can sometimes result in the business not effectively investing dollars.

Let’s say you’re a business that is writing and posting search-engine-optimized content, running YouTube ads, and promoting your website via Google Ads. After a few months, you analyze your media mix and notice that your return on ad spend is highest for Google Ads. You decide that you will not continue with the SEO content and YouTube ads and put all of your marketing dollars into Google Ads.

After a few months, you analyze your results and are troubled to see that the Google Ads Return on Ad Spend has actually declined. This was not the case in prior quarters, and you are not sure why this happened.

Our hunch as marketers is that, in this example, the business forgot about the Marketing Funnel. Google Ads is a great lower-funnel tactic and thus was driving a great Return in Ad Spend at one point. However, it was augmented in our example by Youtube advertising and search-engine optimized content, which are top-mid funnel tactics.

Why does this matter? Our theory in the above example is that cutting YouTube ads and SEO content actually decreased the brand awareness of our small business. After all, if you don’t know about a business, you can’t search for that business on Google and click a Google Ad.

Thus, while Google Ads looked to be the best-performing tactic in our example, it was only the last tactic before the sale. Youtube advertising and web development were doing their job in the top and mid-funnel and piquing the interest of potential customers. Without these tactics piquing the interest of potential customers, Google Ads ceased to be as impactful.

The moral of the story: sometimes, it costs money to make money. Paid advertising, even if it doesn’t become an immediate sale, is still useful.

Tailor Your Tactics To Your Business

Let’s say you’re a lawyer who represents businesses in mergers and acquisitions. Your ideal customer profile is a mid-to-large-sized corporation, and you really need to reach into the legal department at any given corporation to help close deals. You’re in the process of planning out your marketing budget and are choosing between LinkedIn advertising, email marketing, and Google Ads.

When you step back and analyze your business, you decide that LinkedIn is the best fit, as you can reach the right people at any given business via LinkedIn. Now, this is not to say that you should put ALL your spend into Linkedin at the expense of email marketing and Google Ads. A full-funnel approach is always the best for marketing. However, it might be worth putting 50% or more of your budget into LinkedIn as a merger and acquisitions lawyer.

Inversely, if you sell decorative pottery, visual mediums like TikTok, Youtube, and other social media apps will be great for reaching your end consumer. The point to remember here is not that any one tactic is always superior for any business; it’s to remember that your business situation is unique and to keep this in mind when choosing where to place your marketing dollars.

Contact JSL Marketing & Web Design for a Free Marketing Consultation!