Each year marketing budgets are prepared and presented. And each year most marketing teams are frustrated because they usually take a budget hit or do not receive the budget amounts (people and or dollars) requested. To avoid some or all of these outcomes, follow these tips for preparing, presenting a marketing budget that will gain support and the required resources needed to successfully execute your marketing plan.

Marketing Budgets Need to Focus on Business Outcomes

It’s no secret that marketing competes for resources along with the rest of the functions (Development, Sales, Finance, HR, Support, etc.). And of course any competent person can present a set of slides supporting the need for additional resources.

Organizations typically set goals and objectives such as:

  • Increased revenue
  • Decreased expenses
  • Increased profitability
  • Increased productivity
  • Increased customer satisfaction

Each objective has a priority as well as an owner and contributors. It’s critical to identify which corporate objectives marketing supports or drives, and how its resources align with the overall strategy and tactics.

Marketing Budgets Need to be Sold Internally

The most honest feedback I’ve ever received about my marketing plan and budget came from multiple sources (GMs, CEOs and board members). In short, the feedback was that while it was a compelling plan and the numbers appeared to be well thought through, 50% would likely be wasted and 50% would be a homerun. The real issue was that it was unclear which 50% fell into which category.

At the end of the day, the best advocate for marketing is the sales team. Garnering the support of the head of sales requires a good working relationship between the sales and marketing teams – one that’s based on a clear correlation of marketing spend to revenue. Marketing teams with strong field marketing and demand generation teams along with a dedicated account-based marketing function are those that sales is more inclined to support.

Obstacles Marketing Budgets Need to Overcome

The management team (especially the CFO) often asks to rank “marketing programs” and then suggests “killing” the bottom of the list while increasing the frequency or reach of the top performing programs. If this occurs, it’s vital to raise the concept of the number of individuals involved in a B2B complex sale and the length of the average sales cycle. As well, it’s important to communicate the numerous points of entry (LOB, IT, executive and operational) and engagement that occurs throughout the sales stages. Raising these points and ensuring your audience understands the buying process will go a long way in justifying the multi-channel programs needed to attract, engage, acquire, retain and upsell.

One caveat — be careful about marketing attribution – i.e. how marketing correlates itself to revenue. Is it first touch, last touch or a hybrid approach? Or, is it a weighted approach based upon role or influence in the customer buying decision? Be ready for this marketing sourced and marketing influenced discussion.

Traps Marketing Budgets Need to Avoid

Provide a laundry list of functions (PR, ads, website, operations, product marketing, demand generation, demand management, online, social, digital, corporate marketing, etc.) to show that a lot is being done or that each function has a small budget.

Here’s an example: “We did X last year so if our budget is increased 10% we can do 10% more.” Last year was last year and things change. And if they don’t, then fear for predictive marketing to replace the team. The key is to implement change that leads to incremental growth – ideally exponential growth. Communicate what will be eliminated, automated, increased and what is new or game changing.

Marketing Budgets – Think Different

It’s crucial that marketing assumes the role of a sales person when presenting the marketing budget. Here are a few things to keep in mind:

  • Know your audience: be familiar with the approval process, the influencers and recommenders
  • Illustrate how marketing supports corporate objectives in a cascading fashion
  • Communicate what marketing has learned from the past year and the adjustments planned for next year
  • Prove that automation has been fully embraced and resources are stretched to the maximum
  • Document what investments in marketing will yield (prepare three scenarios: worst case, expected, best case)

Marketing Budgets – Summing it Up

Throw out last year’s budget and start with a clean sheet of paper. At the top of the page list the corporate objective or objectives that marketing will support. Next, document the marketing strategy that supports those corporate objectives. Then, show the ideal marketing organizational structure required to execute the strategy. Next, develop position descriptions of the people required to fit the organization structure.

And finally, remember that reversing this process is a recipe for either mediocrity or full-fledged disaster.

In order to move forward it’s a great idea to understand where the organization is and there is no better way than to perform a marketing assessment to document marketing’s current and desired state.


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