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From the author to time-poor readers with <3
Effective marketing is more than just throwing money at advertising, and includes investing in skills, and resources.

Roy Caccamo


As the saying goes, you need to invest money to make money.

However, determining a marketing budget can be a difficult and frustrating exercise for business owners small and large.

Firstly, are you allocating enough funds, and next is your budget being used up the most economical way?

While many business owners ponder through these questions, I have heard others telling themselves that their business doesn’t need a marketing budget at all.
Instead, they generally wait until business is slow and then spend a couple of bucks hoping to generate some extra revenue in a rather last minute reactive response.

While their efforts are at least commendable, the truth is that they should have been planning already, looking at the best ways to get new leads and sales to their business well before slow times and sales.

Every business needs a marketing budget if it plans to be around in the future:

Marketing enables business to develop new products and services that meet the needs of the target market or customers. Good marketing helps a customer understand why your product or service is valuable, and better or different from your competitors.

So if you agree with me that this is indeed important, how much should you be allocating towards your business marketing plan and budget?

Ideally your marketing budget should be driven by your business goals.

  • What is it you are trying to achieve?
  • How much revenue do you need to generate in your business?
  • What is the average sale size?
  • How many leads do you need to generate a certain number of sales of that value?

The 10 percent rule:

Many large companies and corporations have long held the view that a simple ratio of 10
percent of their turnover should be allocated back towards their marketing budgets.
While each industry differs, it seems that numbers have remained consistent over recent years with the most successful B2B software companies dedicating more to the tune of 15 percent to marketing.
Other online business has been known to allocate as much as 25-30 percent into marketing understanding the importance of obtaining market share, and dominance in their particular vertical.

Even if your business is small to medium in size, you still need a marketing and advertising budget.
Most small business operate at a 5 percent of turnover marketing budget, and this is better than not having a budget at all.

A more exact approach:

Let’s take a step back for a moment to consider the following;
If your average sale size is $500, and through marketing and advertising forecasts you know it takes 5 enquiries to generate 1 sale, this means that you convert leads to sales at 20%
Easy right?

Unfortunately, what many people do not know or understand as easily is how much a lead or sale actually costs them. This is mainly due to a lack of tracking their leads, conversions, and sales on older conventional, non digital channels.

The good news is that on digital channels including social media, or search advertising, everything from reach, click through, and even leads can be calculated very easily.

For example if $1000 in ads & marketing = 100 leads, that then = 20 sales
The equation is then very easy to work out, 20 new sales @$500 average sale price = $10,000
So it cost you $1000 to generate $10K in sales revenue.

Even better news:

Right now, on social media it has never been cheaper or better to advertise your products or services.
It seems that most people are unaware of this fact, that when new emerging channels are available for advertising and not yet mainstream, they are always very affordable and provide amazing ROI.
What’s more, on digital channels results are instant from literally the moment that your ads and marketing efforts are turned on.

Get professional advice:

As a digital marketing agency in Sydney, we are always on the lookout to provide our clients with the best bang for buck channels to help them grow their business. I would recommend getting professional marketing and advertising advice from a digital firm because effective marketing is more than just throwing money at advertising, and includes investing in skills, and resources.
Consider allowing qualified professionals to offer advice, and design marketing and advertising campaigns with relative engaging content, designed specifically for your business goals, and objectives.

Regardless of your business goals and objectives – what is true is that every business needs to invest in marketing on some level.

Lastly, if you are not willing to set aside any budget for marketing, then you have to ask yourself, do you really believe in your business at all ?


If you believe in your business, give us a call

If you believe in your business and vision then give yourself a chance by assigning a budget to marketing.

Leave your name and your number and we’ll get back to you.

Press this huge button to get in touch with us.

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Cheers… you legend!

Thanks for getting in touch…

you rock!

Our CMO Roy, or one of our team members, will be in touch within 24hrs.