Marketing Budget Calculator

You will often find yourself asking how much you are allocating your budget to marketing. We have a simple way to do it via our Marketing Budget Calculator.

Marketing is a key part of most private sector businesses. Determining what resources to allocate to your marketing budget is vital for the survival of your company. That is why drawing up a marketing budget is an essential step. As part of our Online Marketing Calculators series we have you covered with a simple formula for determining the size of your marketing budget.

What is a marketing budget?

A marketing budget includes what you spend on both internal and external expenses. With these two figures you will have what is required to understand your marketing budget.

Internal expenses refer to what you spend on your marketing team and other related expenses within your organisation. You add up the overall costs associated with maintaining a marketing team. Staff costs, utilities, software packages

External expenses refer to what you spend on activities, services and events that are not part of running your day-yo-day team but that contribute to the marketing budget of your organisation. These can include one time use of campaign tools, payments to host your advertisements.

Your revenue is the amount of sales multiplied by their price. Whilst this is not in the budget itself you need it to calculate what percentage marketing takes up in your overall budget.

How do you calculate the marketing budget?

The formula to calculate the Marketing budget calculator : your Internal expenses added to your External expenses divided by your Revenue.

(Internal Expenses + External Expenses) / Revenue

What is the amount you should spend on the marketing budget?

There is no fixed rule as to what you should spend on marketing. It varies depending on your industry : some more product-orientated businesses will want to invest more in marketing to sell their products. Some services will spend less knowing that they can rely on a small marketing budget to save costs. On average it is around 10-15% for every business.

The important comparison to make is between more successful sales periods (which can be measured through an ROS calculator) within your own company and whether you need to reduce or increase the marketing budget.

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