One of the hardest questions during any budget meeting is; ‘how much should we allocate to marketing?’.
This is no different for businesses in themanufacturing industry, and typically, a manufacturing marketing budget is one that is very different to calculate.
You not only need to consider the budget you need to achieve your own objectives but also think about what your competitors are doing.
Knowing the industry standard for manufacturing marketing budgets is essential so you can outdo the competition.
So just how big should your manufacturing marketing budget be in 2018?
Here are just some of the factors that you should take into consideration when planning your marketing budget for this year and the forthcoming years.
Key Considerations When Planning Your Manufacturing Marketing Budget
The Industry Average
A Google search for the amount you need to put aside for your manufacturing marketing budget will deliver a confusing list of figures that will leave you more confused than when you started.
Different companies and marketers who want your business will offer figures ranging from 1% up to 25%.
So, who is right?
The current industry average for a manufacturing business is a marketing budget spend of 2.4% of total revenue.
However, in the next twelve months, manufacturers expect their marketing budgets to grow by 4.3%.
Size Of Organisation
Another interesting consideration is that the size of the organisation will usually play a significant factor in how large your manufacturing marketing budget should be.
While many smaller organisations lament the larger organisations for having the capital for marketing, it is usually the smaller companies that see greater returns from theirmarketing strategy.
Smaller manufacturers will typically outspend the larger companies when it comes to marketing.
In fact, it is not uncommon for smaller manufacturers to spend twice as much as the larger organisations.
Often, marketing is more effective for smaller companies, who have much more to gain from their strategy by attracting new customers. For larger companies, the focus is typically focused on customer retention and less on the acquisition.
Where To Spend
Your marketing budget will have to cover expenses for a vast range of activities. Including, but not limited to;
- Trade, show and fair marketing
- Public relations
- Sales tools and presentations
- Your marketing teams
- Website development and maintenance
- Digital marketing
- Content marketing
- Market research.
So, how do you distribute your budget accordingly between each activity?
This will largely depend on your business objectives and where you focus for each year lies.
The allocation should not be set in stone and will vary year on year, and with the different activities that your business decides to pursue. You may also want to set aside another part of your main budget for special marketing projects such as promotional events or new product launches.
Effective Marketing Choices
One popular marketing choice for manufacturers is content marketing.
86% of manufacturersuse content marketing.
In 2018 more and more manufacturers are looking for more structured content plans to achieve higher rates of success from an already effective choice of marketing.
Over the next 12 months, 38% of manufacturers intend to increase the content marketing budget with 46% of businesses keeping their content budgets the same.
Just 3% plan to decrease their content marketing spend.
Social media is considered one of the most effective marketing platforms for manufacturers.
92% of manufacturers have social media accounts to gain a greater reach and enjoy the versatility of marketing options that social media can provide.
The top three types of content for the manufacturing social media accounts are video, posts and photos.
Another effective marketing choice for manufacturers includes digital advertising, such as pay-per-click, YouTube and Facebook ads. The personalisation of these advertising streams means that you can target your ideal audience, key decision makers and consumers to get more from your marketing budget.
In all industries, the focus is shifting away from traditional advertising todigital marketingstrategies.
It is important to work out where your highest marketing returns come from and allocate your budget accordingly.
In an increasingly digital world, it is likely that you will need to proportion more of your budget for digital needs.
When it comes to marketing for manufacturing businesses, knowing the latest trends in the industry will be beneficial. You can then choose which trends to focus on and how they will come into their own in your marketing strategy.
Trends that manufacturers should consider for this year and next will be aspects such as;
- The Internet of Things (IoT)
- 3D Printing
- Robotics and automation.
If your organisation is leading the way with industry trends, then you have an excellent focus for your marketing strategy, and this should be at the forefront of your campaign.
This may mean budgeting accordingly for all of the activities that you can associate with the latest industry trends.
Quality Not Quantity
Another growing trend in manufacturing marketing which needs to be carefully considered when allocating your budget is the quality of your marketing outputs. For manufacturers, there is typically a smaller pool of prospects, so beating your competition is a difficult task. Instead of adding to the noise of your competitors, it becomes essential to rise above by producing high-quality marketing that impresses and helps your prospects and customers.
Differentiating your business from competitors is now vital, and one of the best ways to do this is by offeringunique marketingto your customers.
Assessing the market and finding the ways to produce relevant and engaging marketing material is vital to show your USP and make your company the stand-out choice for your prospects.
Cover The Basics
Another critical aspect of your manufacturing marketing budget needs to be the basics.
Consumers have increasing demands. Having a simple website is no longer enough.
Your websiteneeds to be mobile responsive, helpful and adaptive for customers. Don’t become complacent with your website and social media accounts – these will require constant maintenance and attention, or you risk lowering your reputation and credibility.
You should also think about how your website and information platforms can benefit your customers to your marketing advantage.
Live chat services, a knowledge base and online ordering could be the next step to ensuring you engage your customers and impress prospects with your commitment to customer service.
Compile A Strategy
It goes without saying that your marketing budget cannot be plucked from thin air.
To get an accurate assessment of the proportion of the budget you need for marketing strategies you need to compile an effective and all-encompassing marketing strategy.
It is best to use your business objective and goals as the focus of your marketing plan and then compile all of the activities that can support you in achieving these objectives.
Another vital task is to discuss the budget across all departments.
Many departments could see some of their activities as marketing, and they may assume your budget will cover their activities such as product launches and sales events. Some manufacturers will benefit from having a marketing budget for different departments; others will prefer having a single budget for all departments to use.
However your organisation decides to allocate the budget, this needs to be clear and understood by all.
Furthermore, your strategy needs careful consideration and realistic figures.
Without this, your stakeholders will not buy into your strategy and could lower your budget.
Fortunately, using market research, analysing your competitors and using budget guides can all help to create a powerful and convincing strategy and budget.