Managing a marketing budget demands skill, patience and sometimes even a little creativity.
As a marketer, the responsibility of owning a marketing budget often comes with challenges, unexpected changes and stress. We’ve been there too.
We wanted to do a post about the ups and downs of the financial side of marketing, so we asked two experienced marketers to weigh in on the “art” of owning a marketing budget.
1. Unexpected Budget Cuts & Changes
This is the most common frustration we hear from marketers. Even the most meticulously planned budgets are bound to change because of outside factors. Here’s how a couple of our customers respond when marketing budgets unexpectedly change.
“Expect the unexpected, right? My budget stayed fairly intact this year, but preparing for an event in the latter part of the year, I learned the budget was being cut. We had already dutifully done our logistics and messaging planning, so we found ourselves holding the bag and had to scramble a little in order to compensate.”
2. Defend the Spend
At most organizations, marketers are known as the big spenders. Having the power to spend comes with a lot of responsibility. Expect company leaders to ask a lot of questions, challenge line items, or even strike an entire chunk of your planned budget. It’s essential to know how to justify your plans when questions come up.
“It all comes down to customer acquisition costs and being able to show you understand them and can manage them. In addition, when any spending that occurs, can you promptly show the results — both good and bad?”
“Marketers must always be prepared to show the value of their activity, and expect to have to support a constant, but healthy, scrutiny of their budget and spend.”
3. Working with Finance — for Better or for Worse
Marketing and Finance often have a rocky relationship. Let’s face it: the two departments are just wired differently. One seeks to make as big a splash as possible, and the other values predictability and stability. Friction can arise when the issue of spending comes up: how much is spent, and how best to manage it.
But Marketing and Finance can get along. It’s all a matter of learning to speak the same language.
“Marketing looks at spending very differently than finance. If marketers attempt to look at spending using financial accounts, they will fail. Hence the need for a tool like Allocadia… mapping how marketers look at the world to how finance does their reporting.”
4. The Non-Budget Budget
Every marketing organization spends money, but not every organization manages budgeting the same way. Some choose to take a nontraditional approach to marketing spending. For example, getting rid of the budget altogether!
“I don’t use the term ‘budget’ with the team. Tell me what you need to get the job done and we can figure out how to make it work. Stop thinking budget, start thinking what you need to win. If you approach it this way, you may actually underspend finance’s guidance on spending.”
Read more about Bryan’s unconventional thoughts about budgets in his blog articles: