Toward the end of every calendar year, businesses are likely to begin reflecting on the past twelve months. They review what worked and what didn't, and begin planning for the next year based on what they learned. 2020 brought certain surprises that businesses didn't expect, leading to a difficult time for many. However, this unanticipated experience and the challenges businesses overcame may have made them more prepared to face 2021 with a fresh, optimistic vision for the future.
To help you effectively put together your marketing budget going into 2021, consider the following steps for planning your next fiscal advertising financial proposal.
Reflect on the Past Year
The first step to take is to look back at the marketing employed over the past year, and the best way to do this is by looking at the performance data available to you. Based on the numbers, what worked and what could you improve upon? What tactics and content provided the best performance? Which ones underperformed? Determining these things can help you plan for the year ahead and can also help you identify ways to optimize your budgets. Did you overspend on billboards which performed poorly? Could the budget for that tactic be trimmed to be more in line with its performance rate? Could the extra capital be allocated to better performing digital campaigns instead? For example, you may find that you overspent on certain search engine optimization tactics while you could've allocated more to paid search strategy.
Knowing in what areas you received good results versus areas where you didn’t can help you head into the next year with a better idea of how to utilize your budget. Channeling funds into previously underfunded, moderate to high performing areas may better help and support your collective advertising efforts.
Consider What You Want to Achieve Next
When planning for 2021, think about what you achieved with your marketing efforts and what you would like to accomplish. In the process, you can modify or discard what held you back and continue implementing what helped you get the results you wanted.
Goals setting for the coming year should always draw from what you learned throughout the previous calendar cycle. Consider whether you achieved sales goals that you had in place. Identify areas of spending in your business that had unused funds (e.g. capital expenses, supplies or travel and entertainment) that might be reallocated to your marketing budget.
To facilitate growth going into the new year, consider ways you can expand. For example, are there certain advertising channels or platforms you haven't explored that you would like to consider? Maybe you have some new ideas for changing your creative that you could redirect your budget toward—companies spend an average of 46% of their budget on content creation. You may even find that you attracted business from customers that you never even saw as worthwhile prospects, in which case this segment may be worth marketing to in the future.
Ultimately, you'll want to find out what helped your business grow or what hindered your growth in the past. You can then use this insight to decide on what to keep doing, what to ditch, and what to explore in 2021.
Create a Marketing Budget to Follow
After you've taken some time to review your efforts over the past year, you can begin developing a plan for the next. With your 2020 data and performance results in mind, set your goals and determine your available marketing budget for 2021 paying close attention to following aspects:
- How much your production costs
- The cost of digital ads, TV ads, radio ads, OTT ads, and other campaigns
- How much you invested in the previous year
- The kind of ROI you would like to see for the next year
- When you plan on advertising
- How frequently you will be advertising
You can also consider the ways you can use a strategic partnership to reduce expenses or expand on marketing budgets. Your business may benefit from partnering with non-competing, complementary companies to offer package deals, for instance. You could also receive co-op money from manufacturers that you can then use toward digital and TV marketing or other campaigns.
The more informed you are regarding your company's performance over the previous year, the more prepared you'll be as you plan ahead. You'll be able to effectively allocate your budget and determine what is most likely to get the best possible results in the future. Don't underestimate the value of understanding ROI and how it will influence your campaigns, either. HubSpot's recent Not Another State of Marketing report found that only 35% of marketers saw their campaigns' ROI as "Very Important" or "Extremely Important."
Planning your next fiscal advertising budget based on the previous year is the key to success in the long run. Once you know how to set your marketing budget for 2021, you'll be able to excel and remain competitive as you continue to grow. If you want your campaigns to succeed in 2021, consider working with a media partner. The ideal partner will help you plan your budget and implement it to get the most from your marketing and ad spend.