Marketing is an important line item in your budget, but you can easily end up wasting your money if you aren’t regularly measuring and adapting your methods to changes in the market.
Setting Your Budget
It can be tempting to not increase your marketing budget as you grow to limit your expenses, but it’s best to tie this number to your revenue.
“Our budget remains fairly consistent year-to-year as a percentage of revenue with modest increases commensurate to sales success and overall company growth,” says Jim Engineer, national director of marketing & communications for Visterra Landscape Group, based in Rosemont, Illinois.
Ben Schloss, VP of marketing at Green Lawn Fertilizing, based in West Chester, Pennsylvania, estimates that their marketing budget tends to increase anywhere from 10 to 20%.
“We always want to be investing more into marketing,” Schloss says. “One, so we can do some of the new initiatives. We’re constantly wanting to stay ahead in testing and be ahead there. Two, the cost of marketing always keeps going up. The cost of clicks is always going up. Postage goes up, and the cost of paper. Every single thing goes up. We want to be able to keep up with that from the cost perspective, while still being able to budget for our growth because we do always have pretty aggressive growth goals.”
Jaden Miller, marketing manager for Weller Brothers Landscape Professionals, based in Sioux Falls, South Dakota, says she typically proposes an annual budget by branch based on their strategy and the tactics needed to accomplish their strategy.
Tactics to Prioritize
There is no one-size-fits-all method when it comes to which marketing and advertising tactics will give you the most ROI. Which channels will prove to be the most effective depends on your organization’s overall goals, whether that be brand awareness or client relationships.
Miller says one advertising effort she’s seen a strong return on is Google Local Service Ads.
From a lead volume perspective, Schloss says direct mail has proven to be one of the best methods for them in terms of spend and leads. He says paid social media and marketing emails have also been effective.
Engineer argues that the most compelling sale is the one made in person.
“Effective marketing lays the foundation for trusted relationships, increases awareness and differentiates Visterra from our competition,” Engineer says. “So investments in tradeshows, participation at local and regional trade association events, and good old-fashioned relationship building helps generate the trust, authenticity and goodwill required to build business.”
If you are experiencing lean times and truly must trim your marketing budget, Miller recommends investing in bottom-of-the-funnel tactics where you can confidently track return.
Determining When to Cut or Double Down
Even if your budget doesn’t require you to cut back, it’s essential to have infrastructure in place so you can regularly review the viability of your marketing tactics. Don’t hold on to practices without data to back up their value.
“Data doesn’t lie, and it drives decision-making, so 95 percent of the time I have a clear idea on what programs are working and which ones are not,” Engineer says. “Experimentation and exploration also are key to discovering what’s working and what’s not, but should be pursued at a minimum investment and risk level before committing further. As always, I consult my colleagues for their thoughts before making a decision that impacts any given marketing investment.”
You also shouldn’t be too quick to abandon a channel before testing alternative strategies and creative.
“We’re pretty stubborn when it comes to something that has growth potential, and sometimes that really pays off,” Schloss says. “Paid social, from a spend standpoint, I think it was the number two channel for us this last year. There was one point years ago where the return on that was really bad, and we were getting below one-to-one overall.”
Schloss says they made changes to their campaign strategy, and it has now become a channel that works tremendously well.
Engineer says they will double down on the methods that are working and eliminate those that aren’t.
“Marketing will always be viewed as a significant cost center until it has a seat at the table and demonstrates sales ROI,” Engineer says. “We are storytellers, brand builders, momentum generators, internal culture influencers, reputation drivers and sales enablers, so assessing quantitative and qualitative ROI data is critical to good decision making. Ultimately, my job is to keep the company moving up and to the right so we are not only building a coveted reputation, but raising eyebrows and innovating to differentiate from the rest of the pack.”
