It’s likely that your 2020 budgets for digital marketing have been tossed aside because of COVID-19 and the resulting economic uncertainty. If it weren’t so unnerving it would be almost laughable that we thought we could predict the future.
Now marketers are being asked to do the impossible again. Our clients and stakeholders are asking us to calculate 2021 marketing budgets in the middle of a turbulent 2020. How do we predict 12+ months into the future when we don’t even know what’s in store for the remainder of this year?
Throw out your budgeting playbook for 2021
Most budgeting processes in mid-to-large companies attempt to distill the dynamic and unpredictable future of digital marketing into a few tidy cells on a spreadsheet. Even in a “normal” year, the pace of change is too rapid and anything beyond 3-6 months in the future might as well be 3-6 years.
But budgeting is an essential task that we must not ignore. Why? Besides being financially disciplined, smart marketers also realize that:
- Budgets force prioritization
- Budgets create accountability
You can’t measure these outcomes and you certainly can’t capture them in a spreadsheet. But if you simply approach budgeting by opening your Excel file from last year and start moving numbers around until they add up to an arbitrary value, you’re missing the point.
A better approach to budgeting for digital marketing in 2021
This year, we are working with our clients to rethink how digital marketing budgets are calculated and deployed:
- Acknowledge that we can’t rely on old formulas or assumptions
- Shift your mindset to seek opportunities amidst uncertainty
- Double check that you are asking the right questions and solving the right pain points
- Re-examine your business objectives and ensure buy-in across the organization
- Set measurable goals and create accountability for hitting them
- Develop and prioritize new strategies to accomplish your objectives
- Assess and communicate progress at more frequent intervals
- Ensure your processes allow for course corrections and become comfortable with updating budgets, priorities, or goals in response to changing market conditions
It’s never too early to start thinking ahead to next year. Our teams are already beginning these conversations with our clients even if we don’t have perfect clarity about how 2020 will end.
Want to learn how we’re doing it? Join our webinar on October 6th as we share tools and resources to help with your 2021 budgeting process.
How do we know this budgeting approach works?
Our budgeting process doesn’t seek to just fill in the empty cells in your budget spreadsheet. Our methodology is rooted in our clients’ business objectives and not dependent on fancy calculators. The process evolves as their goals and realities change.
Our clients that start with a budget see better results than those without. It could just be the discipline of setting a target that provides focus, but also a commitment to watching the numbers.
Starting with an objective-based budgeting framework will help you establish the right goals, prioritize your strategies and tactics, and create accountability for achieving your objectives.
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