Every business must invest in marketing to attract more customers, boost sales, and compete successfully against other competitors. If you started marketing for your construction business, you may find yourself struggling to determine how much money you should be spending on this investment or set up the right budget.
There is no one-size-fits-all answer to this question. At the end of the day, the marketing budget or overall costs largely depend on the goals you set for your business, your company’s revenue, and so many other factors.
In this blog post, you will learn important things about marketing budgets. Get to know the difference and correlation between a marketing plan and marketing strategy, what a marketing budget includes, and so many more. We also make sure to give actionable tips on how to maximize a marketing budget and make the most of every dollar you spend on your marketing initiatives!
The Difference Between Marketing Plan and Marketing Strategy
Let’s first go over the difference between these two related concepts: a marketing plan and a marketing strategy. These concepts are related, but they have different uses or purposes in your overall business strategy.
- Firstly, a marketing strategy is more of a long-term, high-level approach that details your target audience, positioning, business goals, and the other general methods you will use to achieve your objectives.
- On the other hand, a marketing plan is a more actionable and comprehensive guide that details your campaigns and activities, specific tactics you will implement to execute your marketing strategy. In many instances, it includes your budget, timeline, and specific objectives for every campaign.
Costs for your marketing strategy depends on the complexity of your construction business, depth of the required research, and whether you are doing it with an in-house team or partnering with an agency. Overall, it is crucial to consider both the plan and strategy as these investments can contribute to your company’s overall success and growth.
What Goes into Your Marketing Budget?
A marketing budget generally covers all promotion, advertising, and public relations expenses. The amount depends on the size of the business, yearly sales, and the competition. Depending on the sector, the marketing budget ranges from as little as % of sales to more than 30%. Newer companies might spend more than 50% of sales on initial marketing programs during the first year. On the other hand, small businesses usually try their best to match the spending of their closest competitors.
The entire marketing budget usually includes:
- Website development
- Digital ads
- Search engine marketing
- Search engine optimization
- Direct mails
- Public relations
- Trade shows
- Print advertisements
Factors that Determine a Marketing Budget
The average marketing budget for a small construction business is around 9.1% of the company’s revenue. It is important to always have a strategic approach since marketing costs can sometimes get out of hand. That is why you need to know the factors that can affect how much you will possibly spend on marketing:
- Business goals: Do you want to generate more leads, increase sales, or increase brand awareness? Knowing your objections can help you identify how much you will have to spend.
- Industry: Other industries usually require a bigger marketing budget than the rest. This is due to target audience preferences and ongoing competitiveness.
- Your actual budget: Always be practical and realistic when planning how much money you will spend on your marketing efforts. Be sure to set goals and be quick enough to make necessary changes.
- Business size: The bigger your construction business, the more you can possibly spend to reach a wider audience.
- Target market: Who are your potential construction clients, and what marketing channels do they frequently use? Having the most critical insights can absolutely help you boost campaign effectiveness and prevent overspending.
- Competitors: Determine how much your closest competitors are spending. Knowing this information helps you to compare. Chances are that the budget you will set may be similar to their budget.
- Stage of your company: If you have just started your business, you need to spend more on marketing ASAP. Doing so helps you create some buzz, build brand recognition, strengthen online presence, boost lead acquisition, and improve organic traffic. Overall, all these efforts elevate your company to another level.
The goal is to have a solid online presence. Once you achieve this level, you can slowly minimize your marketing budget.
- State of the economy: You should also consider other external economic factors since they affect your marketing expenses. Inflation may mean that you need to pay more for marketing services. A recession is a smart time to scale back your marketing budget.
- Location: As for your small construction business, you may consider professional help from a trusted agency. It is a great option and one that requires you to spend. The costs of marketing services from an agency depend on your location. In rural areas, marketing typically costs more than in major cities.
Tips to Maximize Your Construction Marketing Budget
As a small business, maybe you do not have a big marketing budget at the moment. In 2024, 94% of small businesses are planning to increase their marketing budget for the rest of this year. So, you better be open to the possibility of increasing your budget and find ways to maximize it.
That is why we are thrilled to share with you some of the best ways to maximize a marketing budget and the rest of your resources.
1. Segment your audience
Targeting and focusing on the right audience is more crucial than ever. A solid marketing approach will never be as effective as reaching the right audience at the right time. It is all about timing and approach. So, always segment your customers based on their preferences, interests, previous purchases, and other factors.
2. Use data to optimize your strategies and campaigns
Marketing data will help you determine which of your campaigns are most effective. You will also know the areas you are most lacking in. Overall, this helps you do better, create changes, and learn from every mistake. Reviewing and evaluating your marketing data every now and then can significantly help you learn more about your clients and find more opportunities to scale up your marketing efforts.
3. Improve your internal operations
Your construction business needs a solid marketing strategy and a trusted team to implement it successfully. Remember that having a great team helps you create the right budget and allocate it properly.
4. Outsource when it is necessary
Sometimes, the best option is to outsource help. Outsourcing marketing helps your business save more time, effort, and money. You are basically giving the work to the experts in this field. These people have the experience, tools, and capabilities to handle and manage your marketing budget.
5. Increase the impact of every campaign
Many businesses today believe that a marketing campaign is not effective at all because business owners think it will not deliver their desired results. However, the marketing campaign is as effective as it can be only if you know how to leverage it the right way. There are many ways to increase the overall effectiveness of your campaign – you can create compelling content, engage more with your audience, or focus on your customer experience.
6. Experiment with low-cost channels
You can explore some of the best and free marketing channels where your target audience is most active. These channels align well with your target customers. They can be social media platforms, influencer partnerships, content marketing, etc. When you shift your focus to low-cost and free channels, you can still maximize your reach and boost engagement despite budget constraints.
7. Use affordable marketing tools
There is a gazillion tools used for promotion and marketing these days. You have a bunch of options to choose from – from tools requiring a subscription to tools that are absolutely free! Fortunately, in today’s digital world, there are many low-cost marketing tools and they can absolutely help small business owners to achieve their marketing goals even with a limited budget.
8. Monitor and adjust your strategies
To maximize your marketing budget, it is important to track the performance of all your marketing strategies. For instance, you need to track key metrics or KPIs and make sure they align with your marketing goals. Metrics such as conversion rates, social media engagement, and website traffic are some of the most important KPIs to track.
Plan the Right Marketing Budget with ConstructionMarketing.io
Understanding marketing costs is crucial for any business that wishes to invest in and thrive in their marketing campaigns. In fact, it is the first step in determining how much it can cost you to market your business. We hope you will try all of the tips we share above and implement them in your own campaigns.
If you don’t know how to set up a budget for your future marketing plans, partnering with us is the right course of action.
Our agency has the best and most skilled people who can help create the right marketing budget and lay down a solid foundation for many effective strategies tailored to your construction business. We will help you allocate a budget, analyze your company’s ROI, make well-informed budget decisions, and allocate your other resources efficiently.
We offer a complete suite of digital marketing solutions.