• A marketing budget is an estimate of projected costs to market your products or services. A typical marketing budget will take into account all marketing costs e.g. marketing communications, salaries for marketing managers, cost of office space etc. However much of the budget is concerned with marketing communications e.g. public relations, website, advertising, etc. Both are considered here.
  • The costs in a marketing budget will be allocated according to the campaign and the media to be utilized. Some prior research will be necessary for the cost estimates to be as realistic as possible. This is called advertising or marketing communications research.


  • ¨The first step to creating a solid marketing budget is to get organized about your current financial situation. When you are working around estimates, it is impossible to create a realistic marketing budget.
  • ¨Understanding your finances starts with organizing your revenue information. You need to know how much money your company makes on a monthly basis and the variations that might exist. Although income can vary significantly throughout the year, you must organize the information based on reliable revenue.
  • ¨“Reliable revenue” is the minimum amount of money your company makes each month. For example, if your company has revenue ranges from $5000 per month to $7000 per month, the reliable revenue is the lowest figure of $5000 a month. Any amount over that monthly minimum is extra revenue that cannot be added to the budget because it is not reliable and can change.
  • ¨After organizing the total reliable revenue that you can expect to earn each month, you need to subtract expenses. Your business expenses can include renting a space, the cost of materials, the cost of paying employees, etc.
  • ¨Any expense that the company must pay each month should be subtracted from the revenue before trying to create a marketing budget.
  • ¨When you have determined the amount of disposable income available for the company, you should determine where the money will go.
  • ¨Divide up the money based on your goals.


  • After you know the total amount available to spend on marketing, the next part of creating a solid plan is organizing how you intend to spend that money. Three main factors contribute to how you spend marketing funds:
  1. the budget size,
  2. your past experiences,
  3. where you can reach the right audience


  • The final step of building a solid marketing budget is the analysis of the plan and adjustments that improve revenue production. Ultimately, marketing is designed to bring in extra revenue. If the strategy does not bring in new revenue in excess of the cost, then it is better to remove that strategy and try something else.
  • Assessing the data is a vital part of creating an effective marketing strategy. Evaluation begins with comparing past performance to the performance after marketing the product or services. Look at the changes to revenue and determine if it has increased, decreased, or stayed the same. And ideally, you’re able to tie increased revenues directly to each advertising source.

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