How to Budget for Advertising? The Budget Blueprint^SM

The #1 question clients ask is: how do I budget for advertising? It comes in many forms. “How much do I need to spend?” “How can I “make a splash” in a new market?” Or just “How much is it going to cost…?” Our Budget Blueprint^SM answers this question for any organizational leader seeking a systemized answer for how to budget for advertising.

If you’re feeling unsure about what it takes to lead in your category, or meet/exceed growth targets, you’re definitely not alone. Your paid media budget might deserve re-examination. Advertising measurement firm Nielsen says 50% of media plans are underfunded [1]. But whatever the figure, the truth is:

Most brands don’t know how to budget for paid media.

Most brands, even excellent brands, lack a process to budget for advertising or paid media. After content development, creative strategy, production, overhead, partnerships, runaway affiliate marketing expenses, paid media advertising is often an afterthought. Or simply mis-calibrated to the expectations it carries. That’s because paid media is *rarely* treated as a revenue-driver by those outside the marketing suite.

Budgeting for paid media is an almost universal conundrum for organizations. Despite hours spent toiling to pull numbers and facts and figures, the final decision of how to budget for advertising is often arbitrary. It’s a final item on the balance sheet (we call this “last year’s leftovers”) or the seemingly neutral choice of using budgets from last year (or quarter or campaign, etc.). We call this inertia. Inertia is a toxic trap. Why? Because even if your media budget is consistent year-on-year, nothing else about our world, or our consumer, stays perfectly consistent year on year.

So how then should forward-thinking brands budget for paid media?

The Criterion Global Budget Blueprint^SM is a dedicated process of market sizing and media forecasting used to design an effective media investment range.

This process produces a defensible, capital-efficient investment range that is used by a variety of brand leaders to guide smart media planning budget and allocation decisions.

Our budgeting allocation methodologies are selected based on each brand or LOB (line of business) stage of growth, specific audience targets, addressable market area and competitive considerations. What’s the formula? We use a systematized series of media planning budget allocation methods bespoke to each client. This process is bespoke to the client and growth stage – some methods are proprietary, others “triangulate” using more standardized datapoints – to ground a sound range.

Since late 2014, we’ve delivered Budget Blueprints^SM for new venture-backed startups all the way to – quite literally – the largest advertiser on the planet.  Our budgeting practice combines media consulting expert services and agency operations focused on best-in-class media planning and buying. As an independent media agency, our perspective is neutral and unique.

So what do you get with the Budget Blueprint^SM?

The answer depends on your specific needs, however, the core is development of a defensible paid media investment range based on your brand’s stage of growth, markets, and core business attributes.

Along the way, the Budget Blueprint^SM may also address:

• What’s the incremental cost of incremental SOM?
• What is the cost/benefit of targeting approaches?
• Where might I get the best bang for the buck?
• Where is my category’s ad spend trending?
• Where might I save? What is our best addressable market, vis-à-vis competitors?

Before you knew how to budget for paid media:

• Your paid media buying campaign analyses always ended with a question mark: Did we succeed? Could our CPA have been better? Are we being outspent? Did we calibrate our paid media allocation correctly?
• Paid media buying viewed as a cost, rather than investment. This perpetuates continued uncertainty, making it hard to defend marketing’s efforts.

After the Criterion Global Budget Blueprint^SM:

1. Clearly see how paid media investment and allocation aligns with the brand you hope to become.
2. Documentation is clean, clear, and the budget range “ask” is defensible.
3. You have guidance on how to approach media planning to using resources efficiently and effectively.
4. In the event of a surplus or “plus-up” budget, you can defend how to deploy these funds to maximum effect. In the face of budget cuts, you have clarity on how to prioritize and adapt.
5. Above all: the Budget Blueprint^SM is an invaluable tool to develop organizational alignment across teams to justify and win buy-in on paid media planning allocation and investment. With a Budget Blueprint^SM, paid media isn’t just a line item. It’s an investment in the future of your brand.

Budget season is always around the corner. So get in touch to begin.

The first step is a 30-minute discovery call. Contact us to schedule it today.