How Much Should I Spend on Marketing?
Join our host, Toby Rosen, to discuss general marketing budget guidelines, and the most important factors for you to consider when setting marketing budgets.
Check out rosenadvertising.com for more.
Episode sponsor: DevKenya
How much should I spend on marketing? Welcome to Legal Marketing 101. I'm Toby Rosen. Today we have one of the most important questions to tackle. How much should I spend on marketing? But before we dive in, I want to remind you that successful marketing is about more than just throwing money at a given problem. Now, it's about leveraging technology, embracing innovation and feedback, and implementing effective strategies that yield measurable results. Now, the first step though in determining how much to spend on marketing is to establish a budget. One of the most commonly suggested guidelines is to allocate around 15% of your firm's revenues to marketing. While this can be a good rule of thumb, it's really important for us to consider all the other variables that may require different spending amounts. For instance, right off the bat, if you're a newly established firm or if you're really looking to expand into a new practice area or do something different with the business, you might and probably will need to allocate a higher percentage of your revenues to marketing. On the other hand, if you've already built a strong brand presence and have a steady stream of referrals, you may be able to allocate a slightly lower percentage of your budget towards the marketing. variables that exist within your specific situation will dictate where you need to set your marketing budget. Let's explore some of the factors that can influence your marketing budget allocation. First, consider the time of the year. Certain seasons or holidays or cycles in your industry may require increased marketing efforts, while others might be slower and allow for a reduction in spending. For some firms, that's the summer right now. For example, if you specialize in personal injury law, you might ramp up your marketing efforts during the summer months though, when more accidents do tend to occur or a family lawyer might ramp up marketing efforts through January and February when divorce filings are at their peak. Economic trends can also impact your marketing budget. This is because it impacts the number of clients who are willing to shell out cash. During times of economic growth, you may want to increase your marketing investments to capitalize on an expanding market and people who are willing to purchase legal services. Conversely, during economic downturns, we might need to be a little bit more cautious and conservative with spending and focus on maximizing ROI and optimizing our marketing activities. The reality is, though, it just depends. One of the key reasons that that 15% guideline is helpful to us is that it gives us a benchmark to target. If our marketing spend starts to skew too high or too low, we know there's something inefficient going on somewhere that needs to be addressed. But all of that said, where my primary focus typically lies when it comes to marketing budgets is with the objectives. If your goal is to increase brand awareness, you may want to invest in strategies like content marketing, social media campaigns, and public relations. These activities require a sustained effort and often a long-term investment to yield results. Or, say, if your primary objective is lead generation, you might focus on more targeted advertising, pay-per-click campaigns, search engine optimization. tactics typically require a more immediate budget allocation to drive traffic and capture clients. Beyond the economic conditions and beyond the percentage of your budget, what your objectives actually are, at least in my opinion, tends to be the most significant factor in what your marketing budget actually needs to be. Obviously, though, there are situations in which we're constrained to a specific budget, particularly at the beginning of a campaign, and this is absolutely fine. But with an understanding of what the objectives of your campaign are, you or your marketing team can more accurately estimate the costs of the campaign, and you can make informed decisions on whether or not to add a particular campaign to your efforts. If a particular marketing concept doesn't meet the budget, there's always something else out there to try. And you can come back to the higher budget item later. Regardless of your budget, there's always a marketing option for you online. The sponsor of today's episode is DevKenya. Do you have big marketing dreams, but a small budget to get things started? Our friends at DevKenya are building a platform to connect Kenyan web developers with businesses like yours around the world that need to build a custom website at a competitive price without compromising on quality. Use DevKenya to get your website done for under $500 by a Kenyan web developer. Get your first website done for less than half the price of major agencies and double the quality. You can go to devkenya.com right now and sign up for their waiting list. Use the coupon code "ThisPriceIsLegal" for 15% off your first website on devkenya.com. Thanks again to DevKenya for sponsoring today's episode. Now that you're armed, though, with an understanding of what your budget should really look like and how to assess if you're on the right track, let's talk about tracking. It is absolutely critical to track the results of your campaigns so that you can assess efficacy and you can make adjustments to the budgets if needed. The key here is to be data-driven and adaptable. The first step is implementing tracking mechanisms to measure the effectiveness of your marketing efforts. You can use tools like Google Analytics to analyze website traffic, conversion rates, and other key performance indicators. By closely monitoring your metrics, you can identify what's working and what needs improvement. There are a million third-party tools out there as well. You can find some of these on rosenadvertising.com's resources page. Then, once that's set up, you need to be prepared to reallocate your marketing budget according to the data you've gathered. If you discover that a particular strategy is delivering exceptional results, consider allocating more funds to scale that initiative. Conversely, if you find a tactic that is underperforming, be open to reallocating those resources to a more promising avenue. With the right data in place, it's actually a pretty simple equation. Before we wrap up, I just want to reiterate something. Remember that determining how much to spend on marketing is a nuanced process. Well, the 15% guideline is a good starting point. It is really essential to consider all these factors, consider the various factors like your firm's stage in the process and the overall business process, what kind of brand awareness you have already, the time of year, the business cycles, and where things are just for you and your team. And most importantly, the objectives of your business and your campaigns. If you include all these factors when you're making decisions about your budget, you'll be able to make the right decisions and you'll be able to advance the objectives of your business. Be proactive in tracking your marketing efforts, analyze the data, and be ready to make changes. That's it for Legal Marketing 101. Check out rosenadvertising.com for more. Thanks.[MUSIC]