Building an Integrated Marketing Budget
I often hear the question: "How much will integrated marketing cost?" Unfortunately, while there is almost no way for me to predict how much you will need to spend to have a successful integrated marketing effort, I do know that it will likely be less than you might first think, especially in the long run. In fact, in many cases, there is little need for significant, new dollar/one-time expenditures. What is needed, instead, is willingness to coordinate the resources--time, talent, and treasure--that you are already spending.
With that preamble in place, the next two columns will outline some principles that will help you assemble an integrated marketing budget. In this column, we will deal with three necessary cautions that must be addressed before you can begin to plan your budget.
Imagine that you want to build a house. You meet with the architect and ask her to begin developing the plan. Before the architect can begin, however, she must ask a necessary question: How much money do you have to spend? Without that information in hand, she can't develop the plan. She won't know how big or how many or how much.
This same basic principle applies here. Before you begin writing your plan, your president must commit an initial amount or range of dollars to both the plan and its implementation. Even though this amount will likely be adjusted later, it is important to begin with some dollar figure in mind.
I make this recommendation for a number of reasons. First, if the president won't commit dollars, then chances are he is not really committed to the idea of conceiving and launching a sustainable integrated marketing effort. If this plan is truly important, it must receive high-level support, including sufficient allocation of people, time, and dollars.
value? See what it budgets for.
Second, if you don't know how much money you have to work with, it's likely that the plan you develop will be either too limited or too far-reaching in scope. A sense of the real dollars that are available will help you focus the plan throughout its development. The key is knowing the amount of money you have to work with.
Third, if the president says, "Go ahead and write the plan and we'll talk about budgets later," then the champion and the team will be placed in an extremely awkward spot if, after the plan is written, the president is not able to keep his promise about funding. It is professionally embarrassing to write a plan and then not be able to execute it.
A friend, a self-described pragmatic economist, used to say that if you want to see what an organization really values, see what it budgets for. If the institution truly values marketing and understands what it can offer the organization, then the money will be there.
It is hardly surprising that many college and university administrators believe that the biggest requirement for a successful integrated marketing strategy is cash. However, while you will spend dollars, there is another currency that is even more important than dollars. That currency is institutional will. In other words, the ability to make tough decisions and stick to them.
Institutional will has several dimensions, including:
* The will to conduct the research
* The will to focus on a small handful of key audiences
* The will to commit precious dollars to a handful of programs
* The will to target specific geographies
* The will to focus on a small handful of relevant messages
Importantly, it also includes the will to discontinue strategies and programs that are not successful.
Even if you have institutional will, you will spend dollars, often very significant dollars. And while there is no way to predict with certainty how much it will cost, there are some variables that will impact that amount, including:
Number of target audiences. Simple mathematics tells us that the more audiences you try to reach, the more money it will take. It also stands to reason that it will take more money to establish a position in an audience with more people than an audience with fewer. And finally, if your target audience is comprised of identifiable segments, it will take more money to establish your position than if the target audience is homogeneous.
Size of the target geography. The odds are high that establishing a brand in one state will be less expensive than a region. By the same measure, establishing a regional brand will be less expensive than establishing a brand that is national or even international in scope. Resist the temptation, and the ego, to think you need a national integrated marketing plan when a plan with a smaller geographical focus will do. It is better to swarm, and absolutely own, a smaller bit of geography than to be a bit player in a larger one.
Whether or not the position is contested. If your position is "open," it will be less expensive than if the position you desire is already "owned" by another college or university. If you decide to position yourself as the best liberal arts college in Kentucky and you are not Centre College, then you have a problem: Centre already owns that position. In fact, it is generally so expensive and time-consuming to challenge a contested position that most marketing veterans recommend against it.
Less valued position. The important word is "value." If you and your messages are not of immediate and obvious value to students, donors, and other key audiences, then you will spend more time on persuasion, and persuasion is expensive. The more intrinsic value you offer, the more needs you fill, the more relevant you are, the better.
Whether or not the position is complex. Finally, if the position you hope to establish is complex, then it will take more money and time to establish than a position that is simple. For example, it would be easier to establish yourself as the "technology university" than the "university of the liberal arts." Why? Because most people understand, at least at one level, what technology is all about. However, a position like "liberal arts" is a bit more nebulous and subject to multiple interpretations. Furthermore, almost every college and university in the country describes itself as "liberal arts."
One of the biggest frustrations marketing veterans face is dealing with an accounting mentality that focuses solely on cost per piece, or unit, and does not take the time or expend the effort to calculate results. This is a topic that I covered in an earlier column and I don't want to repeat myself.
The key is this: It doesn't matter how much something costs to create. The only metric that matters is that cost divided by the response rate. Without response data, especially for direct marketing activities, it is impossible to calculate the true value of any initiative. Always run the numbers and make sound decisions based on cost per inquiry or cost per donated dollar; don't worry about cost per thousand.
In our next column, we will examine a handful of budgeting guidelines that should allow you to quickly shape an effective marketing budget.
Bob Sevier is a senior VP of Stamats Communications (www.stamats.com) and the author of six books on integrated marketing.
Register now for UBTech 2018
Register now for UBTech 2018, June 4-6 at the Mirage, Las Vegas. At UBTech 2018, you’ll network with a dynamic community of higher ed leaders who are shaping the future of campus technology and explore topics like cyber security, distance learning, campus learning space design, communications, personalized learning and more. Your UBTech registration also includes a free pass to the InfoComm exhibit hall.