08 Apr Seven Reasons You’re Spending Too Much on Marketing (and what to do about it)

Have you been worried over your ever-growing budget? Are you feeling the heat from other departments on marketing, PR and or advertising spending? Perhaps your budget isn’t in question, but you have this creeping feeling that awakens you at night as to whether or not you’re spending your organization’s dollars in the right places.

We hear these concerns all the time and have put together a list of the seven most common causes for overspending and also what you can do about it.

1. You’re forced to be reactive instead of proactive. Did you just learn about a new initiative with a deadline of…next week? This might cause you to need to spend more dollars to accomplish your goals in a short amount of time. Instead, communicate the importance of setting goals with appropriate timelines as this will contribute to your organization’s bottom line.

2. You’re overgeneralizing your target market. You might want everyone as your customer and truly believe that your business can serve just about anyone. But, we have found that this is just not the case for 99.9% of businesses. Create buyer personas (even name your personas) to really get an understanding of your target clients or customers. You will begin to understand their behavior, spending habits, goals, desires, and more in a meaningful way. This will help in cost savings because you can then apply your marketing dollars to areas that are actually meaningful to your buyer personas instead of everyone.

3. You’re repeating old (digital, pay per search, social media, advertising etc.) spends due to FOMO: fear of change, lack of understanding of ROI, lack of time needed to research, fear of losing out. There are many reasons why people keep spending the same budget year over year. But taking a watchful look at exactly what you’re renewing, how it performed, how it’s predicted to perform will do a budget good in the long run. Simply renewing an old ad in a newsletter because it’s what you’ve always done will likely generate poor results and keep your spending high.

4. You don’t want to rock the boat and misstep on an opportunity. Sometimes we hear of organizations spending in a certain area because their leadership thought it was a good idea or once worked but no longer holds value. They continue to spend to avoid upsetting leadership’s opinion versus investigating the return on investment. Organizations with smart leadership will fully understand and likely be impressed when these opportunities are presented with research, even if it means discontinuing of the spend.

5. You haven’t asked for promotions, discounts, deals and properly negotiated. Most companies have a certain amount they can discount or additional value-added services they can offer. You won’t know until you ask. Don’t be afraid to negotiate your agreements and see what can be put on the table for your business.

6. You’re not consolidating efforts and you’re outsourcing to too many companies. We often think of marketing having many different paths of opportunity. Sometimes organizations will have different vendors, departments, personnel, budgets, boards, and functionality for each initiative. This tends to scatter the dollars in the budget and lean out the opportunity for greater value, therefore, result in overall spending more. If you fall into this category, consider what areas can be consolidated. Often vendors will have pricing that will be to your benefit as well with the more business they’re responsible for with your organization.

7. Or you have too many ‘eggs in one basket’ so to speak. You may need to shop around and outsource appropriately to gain expertise and best pricing. On the reverse side of tip number six, we have seen where companies have few vendors and they’re handling what seems like all of their needs like a game of monopoly.

We hope these seven tips help a thorough understanding of how to cap spending and use marketing dollars more efficiently this year.

For more information or for help with marketing / budgeting, call us at (813) 865-3093.