Advertising Budget: How to Keep it in Line with Your Marketing Goals


Advertising is an important part of your sales and marketing efforts. Every dollar you spend on advertising can be thought of as an investment in growing your business.

If you’re a small business owner, you need to keep your advertising budget aligned with your marketing goals. Here are four critical factors you need to look into before you invest in advertising:

  • Target Market – As much as you might want to imagine your product or service has universal appeal, in reality, your target customers likely represent a small, well-defined fraction of the general population. You need to find out who those people are and what they’re like: demographic information such as age, gender, income, and so forth will help you tailor your advertising campaign for maximum effectiveness.

  • Media Type – Once you have a solid grasp on your target market, you need to figure out which media channels will reach them the most efficiently. TV, radio, print, Internet, etc. – use whatever works best for your target market.

  • Type of Message – Now that you know who you’re selling to and how best to reach them, you need to determine what kind of message will be the most likely to get people who see your advertising to actually buy your product or service. For example, should your message appeal to their rational side (e.g. explaining the benefits of your product, how it’s better than competing products, etc.), or their emotional side (e.g. invoking nostalgia, sex appeal, etc.)? This can depend not just on your demographic, but also the type of product or service you’re selling.

  • Projected Profit – Like any other investment, you need to be concerned about your ROI. How much profit will your advertising investment ultimately earn? If you do the math and your numbers end up in the red, you need to reevaluate your advertising strategy.

Once you’ve worked out these four factors, you’ll be better able to analyze market conditions and define the specific goals you want your advertising campaign to accomplish. With that information in hand, you can decide on an advertising budget that’s in line with your goals and determine how it should be spent.