Marketing Budgets

Marketing is more than just selling and advertising goods to customers. It is satisfying the needs and persuading them to buy more products.

Effective marketing of any farm starts with a plan of how this will be achieved through, for example, promotion of the product, advertising and public relations.

Marketing objectives should not be set until all relevant information on the product, the market and the consumer is available. Consumer behaviour and motivation must be thoroughly assessed.

Once marketing objectives have been set, an implementation plan is developed. The marketing plan should have the promotion of the product as an integral part. It must then be decided what basic message is to be delivered, to the target audience and what the intended effects may be.

Marketing Budget

Once the decision has been taken on what needs to be done and how a marketing budget can be developed. A marketing budget tells us the funds that will be required to finance the marketing plan. Furthermore, the budget will also determine how and when the money will be spent. The marketing budget indicates the affordability of the plan and how its execution will impact monthly cash flow.

The marketing budget can therefore indicate how the marketing plan measures up to selected benchmarks and whether the plan can be carried out as designed, or whether it has to be modified or trimmed in some way.

The marketing budget provides vital information for decision-making regarding the wisdom of committing funds to such issues as promotion, advertising and public relations.

Components Of A Marketing Budget

You need to decide how much money you intend to invest in marketing as a percentage of your projected gross sales. You can break it down on a monthly, quarterly or annual basis.

Ideally, you will have already determined the amount of your marketing budget when you have created your farm’s various financial statements. The figure you will choose will depend greatly on your type of business on the farm and your goals.

Short, Medium And Long-Term Budgets

Creating awareness of and loyalty to a brand or trade name takes time. Confidence in a product is normally built-up over a period of several years, and provision has to be made in the marketing plan and budget for ongoing activities.

When an investment has been made in entering a product into the market, it is unwise not to continue bringing its unique attributes to the notice of potential buyers. The ongoing promotion of the Coca-Cola brand is a good example of this. It is necessary therefore to make provision in marketing planning and budgeting for marketing activities and costs of a long-term nature.

Other costs and activities are of a medium- and short-term nature. Most often such plans and the resultant costs will be governed by the current state of the market and its perceived response to below-the-line promotional activities.

Monitoring The Budget

It is the responsibility of the farmer to monitor the budget during which there is an ongoing comparison of actual expenditure against the budget.

Marketing activities are an expenditure that adds value to your farming business. It should not, however, be that expensive so that the profit you make on your produce decreases.