Determining Diligent Marketing for your Company's Budget

Published By: Andrew Schwartz

Getting started

Many of us specialize in one area, a highly focused subject that is non-transferable to the rest of the world. It can make navigating other subjects difficult, and for those who what to start their own business, it means you must be aware of the basics for each area of knowledge. Thankfully, we now have the internet, where you can find more information then you'd know what to do with; on each and every subject.

But Marketing is not as straightforward as many tasks. It presents challenges along every aspect of creation and takes intelligent creativity to master. Each industry is vastly different in demographic, presentation, medium, and many other factors. So how do you get organized and determine a true marketing plan with a serious, yet conservative, budget for your business?

What gets you in front of your audience?

Each business and industry has a completely different standard for the cost to acquire each customer. These acquisition costs vary from as low as 5% and up to over 60% of your business expenses for that year; because all business spend differently this isn’t an accurate measure for marketing.

A more effective formula begins by breaking down the acquisition cost by percentage of each customer's revenues. Then calculating a payback period or (ROI) per customer. For example; if the customer acquisition cost for web development averages about 60% of the first years revenue for each customer, then you can get an idea of how much you will need to speed in order to bring on a certain number of new customers each year. Although with marketing, the end goal is doing this with the lowest initial investment per customer regardless of what business you’re in.


So how do you figure out your budget?

You can only spend what you have available, unless you take out a loan. This is where things get tricky; our estimated calculation for customer acquisition costs don't align with our revenues, unless you get really lucky. Because we know the average cost per customer, we can at least get an idea of how effective your budget will be. The changeling in the beginning is... how do you get started with a budget and ensure you can pay it consistently.

The average company, less than 10 years old, should spend anywhere from 10 - 25% of their revenues on marketing to bring in new clients in the early stages of business. A well established company can begin decreasing their marketing budget to 5 - 15% once they have a recognizable marketing and branding appearance.

Always remember; when a new company is capturing an audience, the cost is always going to be higher then doing business with repeat customers, sometime by as much as 80 Percent. The less known your brand is, the harder it will be to acquire new customers; once your business is recognizable this acquisition cost will drop significantly per customer.

So what will I need?

Any company trying to achieve results with their own marketing is going to need a few key things. For starters, if you don’t have consistent branding, this is the first place to start. What’s the point of advertising anyway, if your buyers can’t remember who you are and what you offer.

A website, even if you have a brick and mortar location, in necessary for any business starting out. Today customers judge businesses by their websites, their online reviews, and in many cases how established they are online.

Social media, just to look legit, helps increase your brand awareness, and establishes the base of an online presence as we talked about in the previous paragraph. This will help get some users on your site, depending on the business, it can also be use as a means for advertisement and promotion but its always great for your website SEO.

Content, like this blog, will help your customers find you because it generates a form of connection. It may also give you another opportunity to create revenue through online sales. If you can help people when they need it, your brand will willingly come to mind the next time they need or want something related to it.


This is where things can get expensive; unless you plan on getting started with word of mouth marketing, and many do, you’re going to need to pay up to compete for your market shares. You can advertise on social media including Facebook, LinkedIn, Instagram, Pinterest, twitter, and many other social platforms. You can advertise on search engines such as Google, Yahoo, and Bing. There's even local Newspapers and Magazines! These are just a few limited way of advertising, based on your business type you will need to formulate a plan that works for you. This is likely the most important aspect of your budgeting; figuring our the right marketing, advertising, and sales budgets will make or break you business early on.


By asking questions and identifying your needs as well as your customers, you can begin to get an idea of what your marketing / advertisement will be uses for; for example what will it promote, where are you advertising, on what medium, what demographic, how will your add be used for promotion, what reaction are you expecting, are you driving direct sales or generating hot leads, etc.

Once you have these questions answered and you have a plan, the cost calculation will be a whole lot simpler. After some consistent trial and error, you'll have some real numbers. Then you can begin to fuel your growth and bring in new business; you'll always be adjusting and perfecting your techniques to remain consistent. Quick tip: don't put your eggs in one basket; whenever possible explore new strategies and solutions to find your business goals.

Make Directory Specializes in startup brand design, launch marketing, and managing online business needs. Contact us today at or schedule a call with us to learn more about our company and how we can help you think outside the box and gain new customers.

Andrew SchwartzAndrew is the head of operations at Make Directory Developers. He holds a deep passion for computers and technology and loves to help answer questions.