While a great product will often sell itself, without the knowledge of the existence of that product, no one will buy it, no matter what major problem it solves.
Marketing encompasses the activities that a company does to promote a product or service. It also involves advertising and many companies will create a budget for this process.
But, as a small business, you might not have the luxury of making budgeting errors without seeing a return. You want to optimize your budget so that you do not spend too much on an ineffective marketing campaign.
Find out the ‘why’ from customers
When creating a marketing budget, one of the first things you want to do is to find out what your target audience thinks of your product.
If your product/service is targeted to a young audience, first find out if they would want your product/service and how they would use it. Find out how it appeases different people within your target market, then create a marketing campaign that covers all sections.
For example, a phone company might target a young demographic but for widely different reasons. For some, it could be due to the camera, for others, the status, for others, functionality. When marketing your product, consider the key areas such as these.
Find a balance in pricing
This is called the price-conversion balance. When trying to market your product, once you understand what your audience expects from it, consider the following when setting the price:
- How does the product/service perform in relation to their expectations? Does it meet and even exceed their expectations? Or does it function just well enough?
- How much awareness does your product/service have? It would be hard to sell your services/product at a high price if people have no point of reference.
- What result do you want to achieve? You could set your prices low so that you build a market share. Or you could set your prices high to create exclusivity around your product.
All the above, and many more, then allow you to create a marketing budget in line with what you want to achieve.
Optimize communication
Communication or lack of it is often what makes or breaks any relations, and that includes a relationship between you and your customers.
When marketing, your budget should encompass ways in which your customers, or potential customers, can get feedback easily and efficiently.
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