Marketing on a small budget
When you're starting out or trying to grow your business, you may only have a small budget for marketing. This is a common challenge, but there are still many marketing activities you can do with limited funds and resources.
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The right approach to marketing with less
Most businesses have a limited budget and resources for marketing. To market effectively with less, you need to:
- have a positive and practical attitude
- think cleverly and creatively
- plan and be disciplined
- narrow your focus to make an impact.
It's about your focus
- It's easy to focus on your limitations and do nothing.
- It's better to focus on your strengths and do something.
Look at what you do have. Think about your available marketing budget and staff, as well as other resources like:
- experience and skills
- ideas and knowledge
- energy and drive
- the ability to quickly respond or change your plans.
How much should I invest?
Setting the right marketing budget is always a challenge. It may depend on your:
- type of business and industry
- specific situation
Some marketing experts suggest spending between 5–15% of total revenue on marketing. In reality, most businesses are more likely to be limited by what they can afford to invest in marketing, rather than what they ideally should spend.
Remember that the most important outcome is to achieve a positive return on investment.
Whatever your level of investment, there's a lot you can do get the most out of your marketing efforts.
Top 10 principles for marketing on a small budget
To get even more out of your marketing, keep these 10 guiding principles in mind (and adjust, remove or add more to suit your business):
Marketing is about more than advertising and promotion. Promotion represents only one of the 7 Ps in the marketing toolkit.
To achieve more with less, you need to:
- look after the current and emerging needs of your customers
- make sure every aspect of your marketing mix works together.
With a limited budget, it's even more important to make sure you're spending your money on the right things. A customer-driven marketing plan will help you focus your time and money on the marketing efforts that will give the best returns.
There's plenty to learn from the great challenger brands whose success exceed their resources. Challenger brands are not the biggest in their industry, but they are intent on growing, often through unconventional means.
Think about how you can do things differently. For example, you may launch a stunt that grabs media attention or run advertising based on a topical theme.
There are constantly new options in marketing: new technology, new channels and new trends. It's easy to worry about missing out on new marketing opportunities.
Remember to follow your customers, not the hype. They're the reason you're in business. Print out your target personas and keep them in mind when you're making decisions.
To effectively market your products and services, you must know how your potential customers make their buying decisions and how they do research. This will be influenced by the:
- product or service you're offering. For example, buying a car will be a high-involvement decision for a customer, while buying the same bread every day will require low involvement
- type of customer. For example, a business might only look at practical benefits and value for money, whereas a consumer might also consider other factors that appeal to them.
When you research customers, make sure to look at this stage of the customer journey.
Media is more than just paid media – don't underestimate the potential and value of owned and earned media. Think of opportunities to integrate the following types of media to maximise their effect:
- paid media – media placement that has been bought, for example, radio advertising
- owned media – media that you can directly control, for example, your business website or signs in your store
- earned media – 'free' media, for example, shares on social media, or a local radio station airing a news story about something interesting you've done.
Partnerships and networking don't have to involve big commercial deals. It's about finding clever ways to grow your business.
Consider boosting your business profile and connecting with potential customers through:
- cross-promotional partnerships with businesses that complement your own, for example:
- a wedding photographer and beauty salon could run a competition together
- businesses in the same area could offer each other's coupons or vouchers
- networking – getting involved with community and industry events in your area can be a free or low-cost way to increase your exposure.
Recommendations from people who are not part of your business can build trust in your business. To choose a product or brand, customers often look to:
- experts – people or businesses seen as authorities in your industry
- other customers – people similar to themselves who've bought and used products and services.
Find out how to:
If you're marketing on a small budget, you may face the problem of:
- not having the skills or capacity amongst your staff members to do your own marketing
- not having enough money to use external agencies.
The answer may be to:
- start small
- focus on your high priority initiatives
- consider training your employees or doing it yourself.
There are many tools that can help you do your own marketing, for example:
- graphic design applications
- website building and management platforms
- email marketing platforms
- social media managing apps.
If you want to be more hands-on with your marketing, talk to your business advisers and do an online search to find and compare free or low cost tools.
Don't forget digital
There are also digital marketing channels which can be targeted based on geographic location. For example, you could:
- create your online business profiles on location-based listings
- use geo-fencing to deliver targeted offers through mobiles in a particular area
- use coupon websites that can be filtered by location
- develop online marketing content that shows your local contact details.
Find out more about location-based digital marketing.
Build your local presence
Local-area marketing could be your most important form of marketing if your business has a physical presence and most of your customers live or work close to your business.
For example, if you run a café, entertainment venue, or accountancy business, your target segments might be based on demographic data as well as geographic location.
In this case, mass marketing channels (like national newspapers) are not the most effective way to market your business.
To avoid wasting marketing funds on ineffective channels, create local brand awareness by:
- using highly targeted channels
- customising your marketing to fit your local area
- using a 'bricks-and-clicks' approach, where customers interact with your business through both:
- offline/traditional channels (e.g. in store or at an event)
- online/digital channels.
It may be worthwhile to create a local-area marketing plan for each community group you want to sell to.
Simple ideas to improve your local-area marketing
Depending on your business type and objectives, you could consider the following proven ways to promote your business in your local communities:
- Invest in advertising or advertorials (an advertisement written to look like an article) in local community newspapers.
- Book outdoor advertising space (e.g. at a bus shelter or on a billboard) in high-traffic local areas.
- Pitch a story about your business, its history or founder to local media outlets.
- Feature real stories about your business and happy customers instore and on social media.
- Use discounts or freebies to reward customers for referring new customers.
- Start a loyalty program to reward your repeat customers.
- Turn your vehicle into a mobile billboard for your business with branded stickers, decal or magnets.
- Upgrade the brand signage and point of sale at your premises.
- Buy pull-up banners and promotional items to use at events.
- Sponsor a local sports club or community organisation that fits with your business.
- Consider advertising in newsletters of local schools.
- Think of staging newsworthy events (publicity stunts) that will draw attention, generate publicity and support your business goals. Search online for inspiration.
- Look for opportunities to link your brand to current events and pitch this to local media.
Make changing expectations work for you
Customers are increasingly expecting businesses to deliver more than just goods and services. They're also looking at the following 3 aspects:
- environmental—how environmentally friendly your business is
- social—how your business interacts with employees, customers and the wider community
- governance—if your business is managed transparently and with integrity.
You can use this to give your business a competitive advantage by answering the following questions:
- What matters most in your local communities?
- How can you improve your environmental, social or governance performance?
- How can you let people know about it?
Get started with marketing on a small budget:
- Find guidance and templates to help you write a marketing strategy and plan.
- Read advice on advertising your business.
- Find tips and other information on branding your business.
- Learn more about using trade shows, exhibitions and other events.
- Find information about making the most of networking in business.
- Last reviewed: 29 Aug 2022
- Last updated: 29 Aug 2022