To effectively market your business, it is important that your marketing activities are planned, recorded and monitored. There is little point spending on marketing for the sake of marketing – instead, each activity should have a clearly defined outcome. Not all activities can be correlated directly to new business, however the purpose of each marketing activity should be weighed up, so that you can compare the costs (and return) of each different form of marketing.
As a rule of thumb, my belief is that unless you are heavily reliant on a brand image (for example, a website might be extremely reliant on a catchy domain name), you should only spend 30% of your first year marketing budget on branding, reducing to a maximum of 10% thereafter. This 10% should mostly be put into ‘reserve’, saved for a refresh of branding every 3 – 5 years.
The remainder of your activities can be mapped out on a marketing plan, with expected spend and also expected return set out for each activity. The most powerful part of this process comes when you then record the actual spend and return on each activity, as this gives you the ability to monitor your spend and calculate a cost per lead for each activity.
When preparing a marketing plan, it is always worth considering whether there are any seasonal trends that you should capitalise on. A fashion retail store would typically focus on clothing seasons, and the sale periods at the end of these. Likewise, a coffee shop might focus on seasonal promotions, selling mince pies at Christmas and iced drinks in the summer.
By Carl Reader, author of The Start Up Guide and The Franchise Handbook