Why marketing budgets are bs (here’s what’s better)

My office recently received a request for me to be a guest on a very popular podcast show that focuses on helping entrepreneurs start a business on a shoestring budget. Now I’m hugely in favor of helping people to start a new business and I can’t stand seeing companies, no matter whether they’re a start up or a Fortune 500 company, get taken for a ride and waste money on their marketing, or on any part of their business operations for that matter.

But I had a fundamental issue with the information that this host was promoting, because every single podcast was centered around cost cutting and trying to find the cheapest possible everything when it comes to running your business, and especially marketing.

Now you might well be thinking, but what’s wrong with finding the best deal for our company? The truth is there’s nothing wrong with shopping around to find the best deal but you need to understand that this strategy is going to be extremely costly for your organization.

Why is that you ask? Because in business, as in just about every area of our lives, we get what we pay for. Ever bought a less expensive shoes that kinda looked similar to the pair you really wanted that were double the price, only to have them fall apart or wear out at lightning speed?

If you’re going to build a successful business, you need to surround yourself with as many A-players as possible. So why does this podcast showcase how to hire D-players?

I’m going to be the first person to tell you that investing in great marketing is not cheap on the front end, but it will pay for itself many, many times over.

Cheap marketing, on the other hand is cheap on the front end and very expensive on the back end because it will very little, if anything to help your business grow.

When it comes to business of getting new clients for your business, if a marketing company knows what they’re doing, they are going to charge substantially higher prices. They know the value of what they’re offering.

Those that don’t know are always going to offer low prices for the simple reason they themselves don’t know any other way of attracting new clients to their business other than by offering a low price. And, if they can’t market themselves by any other means than a low price, then why would you pay them to try and market you?

Have you ever invested in a new website for your company, or chose a company because it looked like they did a decent job but perhaps most importantly they were inexpensive? Only to then discover that your website just sat there like an online brochure gathering dust? So you pay a different firm to create another one, this time it costs more, but it takes a lot more time too and - well I’m sure you know where I’m going with this point - if you had invested in the best company you could afford in the first place to create your website then you’d be a lot further ahead and the website would have paid for itself already many times over.

Which brings us to the only point of investing in marketing in the first place.

The only reason you invest money in marketing is so that for every dollar you spend on marketing, it ideally brings you back $2 or more.

This makes the idea of having a marketing budget a moot point. If I gave you $2 for every $1 you gave me, then how much money would you give me? The answer is as much as you have, right? Keep this in mind. Marketing is not like an HR expense or Accounting. It’s not an expense at all. It’s an investment. Expenses need budgets, not investments.

Now, getting back to the podcast host and my advice for new entrepreneurs.

My advice is to never, ever waste your money by choosing a low-cost option. It’s low-cost because they have no idea if it will work or not either. So, do you really want to roll the dice?

The best thing you can do for your business is to find the best people to help you, and pay them what they’re worth. If that means you have to wait another few months before launching then do it. Your investment in having the best people help you will pay for itself many, many times over and will prevent you from having to constantly revisit parts of your business and keep getting things redone (like your website).

Do things once and do things properly!