There is no crystal ball magic predictor to determine what is the right amount. If you were to ask me this question, directly, I would respond with – invest what you think your business is worth or invest enough to be important. But, those are two different responses, altogether.
Years ago I managed a retail store. Our math used to be 10%. The total of rent + advertising should equal 10 percent of gross sales. The theory was that a good location usually had higher rent. Part of our advertising was the location we were in and part was delivered by external messaging to the consumer. That should be 10 percent of the gross, which in turn would grow the gross each month.
Others might tell you 4-5% of gross sales. Others have other formulas. I think the better question should be where should I spend my advertising dollars? Some people take the pray and spray approach, where they spend a little everywhere. However, this rarely works. Multiple insignificant amounts spread thinly around the marketplace will rarely result in a successful move. Better to pick two, three or four outlets and concentrate your efforts.
If you are going to advertise on any media outlet, spend enough to be important. Invest enough to be sure your messages are seen or heard. Invest enough to make sure the consumer will take you seriously. This means frequency and repetition. If you spread yourself too thin, you will not accomplish this task.
Not sure how to do this? We can help. Call Connie Hayes at 806-748-2404 or call me directly 806-748-2405. We will be happy to meet with you, talk about the choices you have, your competitive landscape and craft a strategy for your future growth. Advertising is necessary, make sure you are doing it right.
Best of Business.
Christopher E. Fleming