First things first, for an established business, the golden rule is to dedicate about 11%-15% of your annual turnover to marketing.

11% if you want to maintain the same growth as the previous year and up to 15% if you want some aggressive growth. You should split 75% of that pot on digital channels and 25% on traditional areas. That might seem like a lot, but trust me; it's worth it; every pound you spend on marketing can bring in five or more back in revenue. 

Now, for all, you newbie businesses just starting. Determining a budget can be trickier. One strategy is to begin with a financial goal you want to achieve and work backwards from there. You want to make £100,000 in your first year of business, and your average sale price is £50. That means you need to make 2,000 sales to hit your goal. Suppose you also know that your average customer will stick around and spend £500 with you over their lifetime. In that case, you can determine that each new customer is worth £50 (500 divided by ten visits). So, if you need 2,000 sales to hit your goal, you must attract 2,000 divided by 10 or 200 new customers. And suppose you're willing to spend £50 to acquire each new customer. In that case, your marketing budget should be £10,000 (200 customers times £50 per customer for the year). Which equates to about 10%

See? That wasn't so bad.

If you're a local business looking to align your budget and marketing mix, we can help.

Local Marketing Made Easy is a full-service local marketing agency based in Greenwich, London. We can show you how a good marketing strategy can increase sales and get that five times or more ROI.

To see how we can help your business, call us on (0203) 303 0625 or book a callback request via the form below.