The new year is approaching and your team has bigger goals than ever, but alas, your marketing budget was cut in half, (or worse, you never even had one).
What now? How can you meet these lofty growth goals with little to no budget? Unfortunately, almost every marketer will encounter this problem at some point.
According to Gartner’s CMO Spend and Strategy 2023 Survey, 75% of CMOs reported being asked to do more with a smaller budget.
While there’s no one-size-fits-all solution, I have some tips that can help.
Manage Expectations
Your company has metrics and expectations that you (& your department) are going to be measured on. It’s necessary that you speak up early on and share what you think you can realistically do with the funds you have. Sometimes that can look like having less events, promotions and sales. Or keep the same amount of events, but simplify the events.
When proposing your change(s), be sure to focus on what you CAN do and how use your budget effectively, rather than focusing on what you cannot do.
Whatever the change needs to be, you need to get it out in the open with your stakeholders as early as possible so that they understand how this budget cut impacts your marketing efforts for the year.
Focus on the free
Now that you’ve managed expectations, you need to figure out where you can cut costs.
Think about all the events you have to plan, is there anything you can buy once and re-use? Can you negotiate a discount with the venue and have all your events in that same venue? What about your vendors? If you book multiple events with them at a time, you might be able to score a discount.
What about social media? Well obviously organic posts are free, so now is the time to up your organic content to build a loyal community that sustains itself without boosted posts, paid ads or constant sale codes.
When it comes to digital advertising, you’ll need to prove that the spend is worth it. What’s awesome is that there are systems out there that track the ROI of these campaigns for you. Some popular ones are Sprout Social and Hootsuite.
Next you’ll want to review your previous year’s ads and find which ones performed the best and which ones performed the worst. Focus on mimicking the ones that performed well and taking small calculated risks.
Track your results, and re-pitch mid-year.
Assuming you’ve made due with your cut (or no) budget, you may be frustrated and feeling like you can do so much more if you had more money. Well this is why tracking the ROI of ALL marketing activities you do comes into place. (ROI= Return on Investment).
Let’s say you spent $1,000 on ads, and those ads generated $5,000 in revenue, then you would have a 400% ROI. (which is insanely good and probably unrealistic, but it works for this example)
Keep your ROIs up to date and handy. It’s a good rule of thumb to report the ROI of your initiatives to stakeholders once they’re complete. You can also use these in your mid-year and year-end reviews.
Another way you can use your ROI reports is to leverage them to ask for an increase in your budget. If you consistently earn a ROI over your spend amount, then you have a strong case to ask for more funds.
Assess your situation
When all is said and done, it’s time to reflect on a couple of things:
- How small or large your budget was
- How you used your budget &
- How it affected your efforts
When you look back are you happy with your results? If not, what held you back? Was it your budget (whether it be too small or spread too thin)? Or something else?
If it was your budget, hone in on step 3 and keep pitching for more funds. (don’t do this every month obviously, but twice a year with new/updated reasons and ROI is a good start). Collaborate with your boss about what it’s going to take to get the budget increase you need and deserve.
If you keep facing rejection, don’t take it personally. Unfortunately, Marketing is still not valued as much as it should be even in 2023. Marketing seems to always be the first department to face a budget cut, which makes tracking your ROI and managing your expectations more important than ever.
Why is this? Well I think part of it is that executives don’t fully understand marketing. After all, most of these executives have a background in business, finance or operations, so they view marketing as an add-on rather than the essential business function that it is.
Think of it like this, when the economy is doing well, Marketing budgets typically increase, and when the economy is a little iffy (like now), Marketing budgets get cut.
As Marketers, we face an uphill battle, but tracking our ROI while setting realistic expectations and boundaries can help us maximize our budgets and prove that Marketing is valuable and deserves a seat at the table (and a bigger budget).
Henry Ford has a famous quote that I think perfectly sums up the Marketing Budget dilemma:
