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Promotional Activity

Laying a Foundation for Successful Marketing Budgets

By Sarah Wortman, CPSM


f you’re like me and accounting has never been your superpower, the prospect of creating a budget may seem daunting. However, I find it helps to ask the following questions before I start the budgeting process to ensure future success.

Does your budget cover Promotional Activity (aka Marketing Communications) and Business Development?

Knowing what I do and don’t have to account for is the first step to budgeting accurately. If your budget only covers Promotional Activity, you can typically manage what you allocate. However, if your budget covers Promo and BD, the next question to ask is what percentage of your budget you control/approve and what percentage you don’t. I have worked at firms where up to 40% of the marketing budget is spent by Principals without ever discussing it with marketing. Larger firms with sizeable accounting teams are usually better than smaller firms at protecting your budget, while in smaller firms it’s more likely for sizeable expenses to get made without your input. Either way, make sure you are accountable for managing only those expenses that you actually approve.

Ask accounting for a report on the marketing budget and detailed marketing spend for the prior three years.

Reviewing history helps you learn what kind of marketing budget the firm is accustomed to providing, how they have been spending marketing dollars, and what “buckets” the accounting department uses to categorize expenses. Three years of data also helps you get a sense of the average cost of those things we do often, such as photo shoots, award submittals, conference fees, consulting fees, and the like. After you review history, meet with whoever is leading accounting or finance to talk about any allocation categories you want to add, drop or revisit so your budget can reflect your plan.

Does the firm use a percentage of profit metric to determine budgets annually?

Most finance folks have a high-level expectation of how much money Marketing should spend. In my experience, that is in the range of 5-15% of projected gross or net revenue. Knowing what your leaders expect will tell you what expenses you can simply submit and what expenses require discussion to be approved.

How does marketing team time on proposals and interview prep get allocated?

At some firms, your team’s time is simply overhead. My preference is that pursuits have their own project numbers and that marketing coordinator time is billed to each pursuit number so we can start understanding the cost of pursuits. This kind of information is valuable for demonstrating to Principals when process changes need to be made in how we pursue work.

When the time comes to begin budgeting, the next step is to decide how much to allocate to which accounting category. If by the time you’re budgeting, you’re well into a marketing plan, you usually have a sense of how much of what in each category you need to do. Let’s look at some categories that most of us have in our budgets:


Chances are if you ask your studio/market/service leaders, they’ll know which projects will be ready to photograph in the coming year and you can budget accordingly. Your review of three years’ worth of expenses should tell you how much to budget per shoot, based on the types of photographers you usually hire, the size of jobs you’re shooting, and whether or not others are sharing photoshoot costs. For example, if you typically spend about $6000 per photo shoot and there are 10 projects that will be ready to shoot next year, you’ll budget $60,000 for photography.

Consultant Fees

Most marketing departments don’t have all the expertise needed in house and will thus outsource some part of their work to someone like a copywriter, graphic designer, web developer, videographer, etc. History will tell you what the firm has spent in the past and your marketing plan will tell you what you need to spend. (e.g., if you’re going to do a revamp of your website next year, get a few bids for services when you’re budgeting to help you figure out what to allocate to the task.)


If you do a lot of public work, chances are you need to budget for printing, postage, binding machines and other supplies, etc. You may also need a budget for swag.


In addition to SMPS membership dues for your team, you may want some paid memberships in client-facing organizations covered via the marketing budget. Those who engage in media relations need a certain number of print or on-line subscriptions, starting with your local business journals and extending to trade or popular press.


I always budget some contingency funds to cover expenses that arise unexpectedly. One year your binding machine may need to be replaced. The next your firm completes a merger midyear and wants to do an open house. Perhaps you lose a staff member and need to cover their work via a consultant until you can hire their replacement. You can either distribute a contingency budget as overage in a series of other “buckets”, or create a generic category called “Miscellaneous” and keep it there.
It is rare that a budget is completed in the first pass, so you should expect to do a few revisions. After I create a first draft, I check it against the firm’s percentage metric for marketing and see where I land. If what you need exceeds the percentage typically allocated, you know you’ll either have to make a case for the importance of garnering additional funds or adjust what you can afford to what the budget percentage allows. If it’s the latter, be sure to share the consequences of those choices with leadership. I just finished determining the total cost of all the conferences we want to attend this year, including registration fees, hotel, lodging, meals and entertainment, which led to a discussion about how many people need to attend certain conferences for how long, and out of whose budget.
Finally, I think it’s helpful to understand that, among the various corporate services budgets (IT, HR, Finance, Marketing), costs for the other three are generally fixed. Thus many firms look to the marketing budget as a place to cut when revenue targets aren’t getting met quarter by quarter. I’ve learned to calendar my expenses in down years and make thoughtful choices early in the fiscal year that allow for us to continue meeting needs in the latter part of the year. No one wants to hear in August that they can’t submit for a prestigious award or attend and important event because we blew the budget on things that took place in February.
At the end of the day, a budget is just a financial representation of your marketing plan. If you work well with your accounting team and align costs with your strategic plan, you’re well on your way to success.
Sarah Wortman, CPSM is director of business development at GGLO Design, with offices in Boise, ID, Seattle, WA, and Los Angeles, CA. Wortman has been an A/E marketing leader for 20+ years. Prior to that, she was a communications professor and a radio documentary producer.
Email Sarah at