5 Reasons a Marketing Budget Is Imperative to Your Success

Why Work on Making a Marketing Budget?

Nine times out of ten, when we ask a shop owner, “What’s your annual budget for marketing?” we hear crickets on the other end of the phone. Very few small businesses have a formal marketing budget in place, because the truth is, few of them know how much to spend on marketing. And to make it even more complicated, there’s a revolving door of considerations to nail down a marketing budget: what’s normal for your industry?  What are your competitors spending on marketing? And what exactly constitutes a marketing budget? Does it include a website? Printed mailers? Social media? It’s enough to drive you doggone mad!

5 Reasons a Marketing Budget is Imperative for Your Auto Repair Shop Internet Marketing

Typically, all these questions and the research they require leads to throwing in the towel on establishing a marketing budget, and instead, taking a haphazard, inconsistent approach to marketing. But, without having some sort of marketing budget in place, you put yourself at risk of making impulse marketing decisions that don’t generate the results you’re looking for.

There are 5 main benefits of having a designated marketing budget:

  1. Provides clear sense of direction for the management of your marketing efforts.
  2. Allocates scarce financial resources more effectively.
  3. Encourages coordination and planning with other areas of – and people in – your business: finance, operations, HR, etc.
  4. Provides a basis for assessing actual results. How much you spent vs. how much you earned from a particular marketing source.
  5. Makes you successful! If you know how much you have in the budget to spend, you’ll have a better idea of which marketing avenues to go after to maximize your marketing ROI.

So how much of my revenue should I dedicate to marketing?

Return on Investment Sign - ROIThe U.S. Small Business Administration recommends spending 7-8% of your gross revenue for marketing and advertising, if you’re generating less than $5 million a year in sales, and your net profit margin falls between 10-12%.

Many of the shop owners we work with spend 3-4% on marketing, and with an organized plan and defined marketing budget, that will often be enough. However, the shops we’ve worked with who have seen the best marketing ROI spent between 6-10%.

Don’t get discouraged.

Setting a marketing budget is a daunting challenge for many small business owners, we get that. No one can create a perfect and absolute marketing budget; it has to be flexible, and fluctuate as your revenue does. The best you can do to begin is evaluate your spending, assess your competitors’ advertising methods, look at your historical results, and go from there.
Remember: in successful businesses, marketing drives revenue, not the other way around.

Need Assistance?

If you need help taking charge of your marketing budget, our industry connections can help! See our partners below, and visit their websites to find webinars, blog articles, and coaches who are ready to help you take your shop to the next level.

RLO Training


Automotive Training Institute (ATI)


Educational Seminars Institute (ESi)



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Is Your Website Turning New Customers
Away Without You Knowing It?

Written by Autoshop Solutions

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