BUDGET SETTING METHODOLOGIES: Build a Business Case for Your Marketing Communications Budget

At this time of year, many marketers are still in the midst of budget planning and implementation. While all managers have a wish list of projects that they would like to fund, most fail to frame their requests within models that can be understood by their company’s financial team. Only by taking a systemic approach that is supported by evidence, will marketers be able to obtain appropriate budgets to achieve their goals.

There are dozens of ways to calculate necessary marketing budgets. When estimating, marketers should aim to arrive at a budget with a reasonable level of confidence, as efficiently as possible. When we estimate for our clients, we triangulate two to three different methods. Which ones we recommend for a particular client depends on each company’s specific circumstances including industry segment, market maturity, marketing channel complexity, ease of obtaining metrics, etc.

In “Budget Setting Methodologies: Build a Business Case for Your Marketing Communications Budget”, we review a number of the most common budget setting approaches, including Target Sizing, Sales Goal Approach, Share of Voice, Advertising/Sales Ratio, Share of Market and Task-Based.

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