The new financial year is the perfect time to inject new life into your business and consider your budget. Fixed expenses are easy to budget for, but there’s no magic number your business should spend on brand development and brand awareness. Want to work out how much you should allocate to branding? We’ve put together some basic guidelines.
How much do companies budget for branding?
As a rule of thumb, small businesses spend about 8% of their gross revenue on marketing and advertising. Of course, every business is different. B2Cs will spend more on marketing compared to B2Bs, and startups will generally spend a lot at the outset and then taper off as the startup gets established.
I have a budget. Is branding worth investing in right now?
If you’re in the startup phase of your business, it’s critical to time your branding investments. Spending too little, too late can make your company disappear in a sea of competitors — and spending too much, too early means that you’re losing financial resources that could be put elsewhere.
If you’re B2C and not yet generating much revenue, look into spending no more than 10-15% of your total budget on branding. B2Cs need strong brand identity to attract customers, so put that budget into a name, basic visual identity, a good website and domain name, and basic copy and messaging.
B2Bs can afford to spend a little less on branding — but make sure your business still has the basic brand needs. Focus on communicating your business’ culture, story and quality.
Once your business is established and generating revenue, your branding budget can move between 8-15%.
I want to cut the budget. What branding can I do myself?
Consider your own skills and how they can translate to branding. Social media profiles are the easiest to get up and running. Once established, you can hand social media off to an intern (your cheapest option besides doing it yourself) or an agency.
Be realistic about what you can and can’t offer. You may be able to think of fantastic branding strategies or have graphic design skills, but pouring your personal energy into branding will mean that you will spend less time and thought on other aspects of your business. If you don’t have qualified staff, outsourcing your branding isn’t a cost — it’s an investment.
What should my branding team look like?
A well-rounded branding team will have experts in design, marketing, digital strategy, communications and branding strategy. You can pull a team together yourself from your employees, or you can go externally and find an agency. Agencies will cost you more money, but you often get what you pay for. A good agency will supplement their in-house knowledge by contracting with specialists to tailor your branding to your specific needs.
Interview a few agencies to get a sense of how they work and whether they understand your needs. Don’t be afraid to look at smaller, independently owned branding agencies over larger, global agencies. Experience is more important than size and prestige. Look for an intuitive brand strategist who is in tune with your vision. A good brand strategist will not only work within your budget, but help you determine your budget.
If your branding needs a kickstart, get in touch for a free consultation on budgets, goals and strategies for your company.