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When setting a budget for your small business it can be a struggle to know exactly how much to allocate to your marketing spend. One of the main reasons for this is that it can be hard to calculate the return on investment from marketing as often it isn’t always measurable, especially when it comes to branding. This makes it hard to decide whether the amount spent on marketing last year was too little or too much so we have created a list on how to avoid overspending on marketing.

  1. Don’t dive right in!

Often small business owners will think of marketing ideas without conducting sufficient research into their target customers. Without researching their target customers it will be hard to simply guess what type of advertising that customers will best respond to. Unfortunately many companies discover this themselves and it isn’t possible to recover the costs wasted on ineffective marketing campaigns. By investing time to conduct research your small business can avoid overspending on marketing.

  1. Avoid risky strategies

The devices, mediums and strategies that can be used to reach your target audience are constantly changing. Often they are released with the idea that they are the ‘next big thing’ in marketing but the majority of them are unproven. Large businesses that are well-established in the market have a bigger marketing budget. They have the resources available to take risks in their marketing strategies but it is not worth the risk for small businesses. Instead they should wait until the bigger players test the new concept to see if it is a success or a bad investment. This will result in them being able to avoid overspending on marketing

  1. Don’t expect immediate results

It is important to not get discouraged when you don’t see the results from marketing campaigns that you were initially anticipating. It can be hard to put a time frame on results from marketing campaigns as building an audience can take time. By having a well-established brand, message and audience you are more likely to see quick results but establishing all three of these takes time. To avoid overspending on marketing it is important to acknowledge the time it can take to see rewards so don’t just jump into a new marketing strategy.

  1. Budget

Budgeting can be extremely tricky when it comes to marketing due to the hard to measure return on investment. When presented with a budget, many marketers will spend every last cent of the budget. Zero-based budgeting is a method in which the budget is built around what is needed for the upcoming period. As opposed to methods like incremental budgeting where the previous period’s budget or actual performance is a basis with incremental amounts added for the new budget period. Some campaigns will require a little more money than others but if you have a bigger budget than you need, it can be easy to spend the remainder on things like Google AdWords. To avoid overspending on marketing your small business should consider zero-based budgeting.

By following this list to avoid overspending on marketing, you will be helping your business to grow as well as being able to benefit from good cash flow. Check out our handy guide to learn more on good cash flow management.

Marc O'Dwyer

After completing a Graduate program in Marketing, Marc’s impressive sales career began at Allied Irish Banks, Pitney Bowes and Panasonic where he received numerous Irish and European sales performance awards and consistently exceeded targets and expectations. In 1992, Marc’s entrepreneurial spirit led him to set up his own business, Irish International Sales (IIS). Initially, this company was a reseller for Take 5 Accounts and Payroll software. Within four years, IIS became the largest reseller of Take 5 in Ireland, acquiring four other Take 5 resellers. He also found time to set up two mobile phone shops under the Cellular World brand and a web design company offering website design services for small businesses. In 2001, he bought the majority share in a small Irish software business, Big Red Book. At that time, the company was losing money. The company became profitable within two months, and Marc then acquired a payroll company to compliment Big Red Books Accounting products. In 2003, IIS were appointed as Channel Partners with SAP for their new SME product, SAP Business One. Marc sold his Take 5 business and concentrated on developing this new market for SAP As a result, by 2007, IIS was recognised as the largest Channel Partner for SAP in EMEA (Europe Middle East and Africa). In 2008, the IIS Sales Manager bought the Company from Marc in an MBO. He launched Big red cloud in June 2012, the online version of big red book, to date the company successfully converts 59% of trials into sales and the number of customers is growing rapidly. Marc continues to run both Big Red Book and Big Red Cloud which now support 75,000 businesses. He is a very keen sportsman, having played rugby for 20 years, represented Leinster at under 16 and under 20 levels, and league squash with Fitzwilliam Lawn Tennis Club for 10 years. Marc has competed in 11 Marathons, including the London and Boston Marathons, and has completed several Triathlons and Half Ironman races. He has also completed six Ironman Races in Austria(x2), Frankfurt (Germany), Nice (France) , Mallorca (Spain) and Copenhagen (Denmark)

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