As a leader, main man, top dog, or any other pet name you can think of for yourself when referring to your role as decision maker, there will be times you will be faced with when to refocus, redefine, or re-purpose the financial resources of your organization depending on the challenges you may be facing. Change is all around you, and keeping a steady course during those times is a challenge all in itself. One of the common areas that most entrepreneurs will immediately look at cutting is the area of marketing. As an entrepreneur, your budgets (if you follow one) are not normally as flush as those of Fortune 500 companies. As a result, your ability to refocus or repurpose resources becomes a lot more stressful and difficult to do.
We’ve heard of the different types of marketing, and it can be very confusing. I’d like to support you in reducing your stress regarding marketing; there are amazing marketing coaches out there who can support you in creating a full marketing plan, outlining what is specific to you, and your organization. But today let’s bring your focus back to the basics so when you decide to hire that coach or consultant, you have an idea of what marketing means to you and your business.
So what is marketing, or a marketing budget, and why do you need one? Simply put, marketing is defined as the process used to determine which products or services are of interest to your clients and outlines the strategies best used in the sales, communication, and development of new business. Okay, that wasn’t so simple; but basically, it means matching your product or service with your client. The budget piece is the estimated cost of running these programs and projects. The “why” is basically all about transparency and empowering you to stay focused and moving forward in the right direction with each decision you make regarding spreading the word about your wonderful products.
Success is in the details. The more detailed you are with your ideas and plans for spreading the word, the more effective you can be in your decision-making when new opportunities are presented. Budgeting is about accounting for how you’re spending your financial resources to ensure maximum exposure for each dollar invested. When times are financially challenging, it can be easy to stop a certain marketing activity if you rationalize within your own mind that it will be for only a few months and then you can begin the activity again—basically pick up where you left off.
And yes, this might be true to a degree, but in reality? Not so much. Here’s a visual for you; your marketing efforts are a steam engine. Each of your marketing programs is one of the wheels, your personal passion is the coal miner that stokes the fire and your financial resources or money is the coal. When you began your business, you worked hard at building the engine itself, putting each wheel on and in place—Facebook fan page is one wheel, another is your business card, another is your website, another might be Twitter, another is local networking groups, and a sixth might be professional organizations tow which you belong. With each new wheel you add, the easier your engine moves up the hill; that would be your business growing and becoming known. Your passion is put into adding the coal to the engine’s fire to boil the water (i.e., client interest) to get you moving toward your goals.
Now that you’ve built up momentum, you’re facing a financial challenge that requires you to reduce the amount of coal feeding the fires of the different parts of your business. Thinking you have all of these elements in place, and it seems like you have a good amount of speed, you feel cutting back and repurposing these marketing funds for other expenses is a great solution. But now your train begins to slow down and the wheels are grinding and slowing even further until you are barely moving. Yes, the financial challenge is behind you and you’re now putting more money into the marketing engine. Yes, you may be crawling, but it will take a lot more of your personal energy, focus and passion to get the fires of marketing roaring again. You were there, then you weren’t, and now you are again. Potential clients get confused, and their attention span is so small that once you’ve lost them, it’s hard to get them back.
It’s doable, but it will increase your stress level instead of alleviating it. So what do you do?
This is where your budget and tracking processes support your decisions. Here are some great questions about which to begin thinking: What is your total revenue for the year? What percentage were you spending on marketing before the financial challenge came about? What is the total amount by which you need to cut back? For example, say you were earning $100,000 a year and spending $5,000 on marketing (which is about average or five percent). For you to honor your current situation, what do you need to bring this percentage down to four percent, three percent, two percent? Review how you can reduce the costs of certain marketing efforts before just discontinuing them altogether.
Being an effective leader or entrepreneur is all about balance, and balancing where to invest your resources is as important during good times as it is in challenging times. Remember there are a lot of free and low-cost resources available to you. Your passion and business’s momentum depend on your courage to raise your hand and ask.