document.documentElement.className = 'js'; Budgeting for Marketing | Small Time Me
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My customers and students often ask why they should invest in regular marketing. Many sales people like to ask the question: “If you gave me $100 and I gave you $1000 back, would you do it?”

This is the key promise of marketing, and it is often disappointing, because life is never linear, let alone geometrical. To simplify it, if you could consistently return just 2x marketing spend on $100 and reinvested your earnings, within 24 years you would have 2^24 earnings, or $1,677,721,600 off of an initial budget of $100. Yes, Microsoft, Facebook, Amazon, Apple and a handful of other countries have managed that level of growth for a limited period of time. But even they cannot do it more than once. There is no company on the planet that has sustained Inc 5000 level growth for 4 decades in a row.

If someone could maintain this level of growth that marketers routinely spout in our sales calls, they would be earning $109,951,160,000,000 off of an initial ad spend of $100. That’s $100 trillion a year.

So no matter what results they show you of someone who got 10 times a return on their investment, the fact of the matter is that marketing can never produce predictable results.


Markets change. Technology changes. People get bored.

What is the Point of Marketing Then?

Good question. The point of marketing is to stay in business.

When a prospect asks me why they are not getting more customers, I ask them what they have done recently to communicate with their customers, to let their audience know they are still around and doing business.

They usually say nothing.

That does not work. Marketing requires regular work, regular feeding, in order to keep your business cash flow moving.

So, for my clients, I recommend that they have between 10% and 30% of their budget set aside for marketing, depending on their business systems.

What about you. What percentage do you set aside for marketing your business?