How to set a value on marketing
We know that there are really 2 questions on your mind when you think about marketing:
 
1.     Is it worth it?
2.     How do I measure its' value?
 
Few business people really understand marketing and hence treat it as a balance sheet commodity ... which is a mistake.
 
We do understand your problem. Marketing isn't a product like a can of paint that you pick off a shelf. You can clearly see how well your paint works after applying a coat or two.
 
But marketing ... now that's a different animal. You can't quantify it's effect because it's not like a coat of paint. You can't tell how much value you are getting for your money. It's an accountant's worst nightmare!
 
One thing is for certain ... customers will only buy your products if they know about them ... marketing is how they find out. So, let's measure value from a different perspective...

Each component is worth
the cost of the whole machine
You can see a complicated machine in the photo above. Take any one of those components away and your machine either doesn't work so well or stops working completely.
 
Marketing is a component of a machine called "Your Business". Every machine MUST have all it's components, so the VALUE of each single component is the COST of the whole machine.
So now you're thinking, "OK OK, you've convinced me that marketing is important, but just exactly how does this help me to put a price on it?"

Here's an idea that may help
This is a tip used by many businesses around the world...
 
Add together all your basic overheads ... your rent, salaries, service bills etc. You don't have to be accurate, round figures are fine.   5% of this figure is a reasonable budget for your average, every-day business marketing.

...and it's self correcting!
This method takes the guesswork out of setting a budget ... and it's also self correcting. As you see your business grow, quickly re-calculate the budget and go chat to your marketer. Problem solved!
Quite obviously though, if you intend to launch a new and exciting product, you will need to think the project (and its' marketing) through from the outset.
 
From your business plan you will have a good idea of how much it will cost you to get that new and exciting product through design and out to retail ... a lot!
 
In this situation your marketing costs will be comensurate with the cost of getting from the initial concept through to getting the finished product to market.
 
A new and exciting product will need as much marketing innovation as engineering.

...as a guide
(I know you're wondering)
To give you a couple of ball-park figures here ... if you're running a 50 seater restaurant in a small town for example, you should be thinking about a budget of R5000 a month ... plus a contingency fund for that occasional promo event!
 
Scale that up to a 10+ venue franchise and you need an entirely different style of marketing ... you have a brand to maintain, which is a whole different ball game.
 
Even if your franchise owners do their own marketing at venue level, your marketing must support the brand recognition for the whole franchise. So R1/2M annually would be a reasonable start point in this case.
 
If you are launching a new and exciting product, then it depends what your new exciting product is and how much it cost you to develop it. If you spent a lot ... it will cost a lot.
Fortunately, getting started is easy
just drop a WhatsApp or an email over to us
 
076 066 9200         lawrence@aktileda.co.za

Work with Aktileda ...
... Work for Success
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