Kelly Waltrich, CEO and Co-Founder, intention.ly
getty
What did you say when your CEO asked you what your 2022 marketing budget should be? If you’re like most (smart, talented, hardworking, and incredibly capable) marketing leaders I work with, you didn’t know — and it’s not your fault.
Get these answers before you budget.
What are the company’s revenue targets for the year?
This is easily the most crucial information you need to even think about a budget. Revenue is the yardstick against which marketing performance should be measured, meaning the vast majority of your team’s efforts should track the company’s overall revenue goals. Proving the impact your team is having on revenue is the best and fastest way to see your budget increase year after year.
The company’s revenue goals are your foundation, but to understand the resources needed for you and your team to achieve your goals, you also need answers about the product roadmap and broader business objectives.
• What new features, enhancements, or products do we plan to build?
• Which major releases should we communicate?
• What integrations are we planning?
• Are there any acquisitions on the horizon?
• Do we plan to explore new markets?
Marketing plays a part in making all of these things successful. Your team will be responsible for coordinating press releases on acquisitions, curating and promoting webinars for new products, advertising new integrations, conducting research on new market segments – the list goes on.
If you, as a marketing leader, don’t know what’s on the company roadmap for the year, you can’t possibly consider the budget you need to execute those big items. That means a) you’ll have to leverage your existing budget and forgo some or most of the other efforts you’ve planned, or b) you’ll miss opportunities to turn acquisitions, product releases, and integrations into the competitive advantages they would. could have been.
Even if you’re in control of the company’s revenue goals and future goals, you still don’t have all the parts you need to build an effective budget.
You also need to know what the sales force goals and expected growth look like for the year.
One of the biggest obstacles to long-term sustainable business growth is misalignment between sales and marketing teams and a lack of understanding on both sides of how they can work together to be successful.
Increasing the number of sales force employees inevitably means higher sales targets. This affects both the total cost of acquiring customers and the number of demo or contact requests your team needs per month, all at the expense of your budget.
But wait, there’s more.
What are the marketing team’s additional expectations beyond monetization?
Things like brand evolution, website development, event and conference support, customer success materials, and recruiting aren’t directly linked to the pipeline, but they do eat up marketing resources, and you need to be aware of them to set a viable budget for your business. build a team.
What are the two budgeting weapons every marketer needs?
In addition to making sure you have answers to the questions above, start tracking these two things now to prepare yourself for budgeting success in 2023.
• Keep track of when you’re asked to do something outside of the expectations previously set for your team.
For some reason—perhaps because we’re good at it—marketers, more than any other role or department, are expected to turn a dime to help other business functions.
I’m all for being a team player, but I also firmly believe in the value and power of marketing, which dilutes when marketing teams can’t focus on their actual work.
Being able to demonstrate where and when your resources needed to be allocated elsewhere will give you ammunition to ask for more resources or point out why you may have missed your targets.
• Track the value of marketing dollars versus sales personnel.
I was just preaching the importance of aligning sales and marketing, and I meant it. I’m not suggesting that you put marketing versus sales in some sort of growth-focused fight club.
What I’m suggesting is that in order to get the budget they deserve, marketing teams need to demonstrate their value when it comes to cost-effectively and sustainably driving pipeline and revenue, as opposed to the wildly inefficient, old-fashioned model of outbound brute force sales.
The truth is this: marketing customers will always cost less because they are sales ready to buy. For a sales rep, closing a marketing lead is like starting at mile three of a 5K. The deal is almost done; it just needs a little push to cross the line.
With the right budget, marketing can put the company’s value proposition, benefits, product features, differentiators—all the things salespeople talk one-on-one about with prospects—in front of the entire target audience at once.
When more prospects from marketing enter the pipeline, the cost of acquiring customers decreases and sales cycles shorten. These are concrete profits for the entire company, including sales. If you can show executives that you’re getting deals more efficient than selling, you can reasonably expect some of their budget to go to your team.
Being able to build a business case for the budget you need is a critical part of being a successful marketing leader. It takes time to build the skills and determination to advocate for yourself and your team, but you become exponentially more effective when you can make your case clear and concise using the metrics (turnover) that leadership cares about.
More than any other function in your company, marketing has the power to drive accelerated, long-term growth. You deserve a budget that enables your power.
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