A marketing budget is the amount that your marketing department is permitted to spend each year. Marketing budgets are usually set before the year starts, depending on your company's fiscal year. For example, some companies start their marketing budgets in January, while others start in November. Your amount of your marketing budget will usually be contingent upon what you can afford, your industry and how long you have been in business, according to "Entrepreneur" magazine.
Labor
The vice president, director or highest-ranking marketing department employee usually controls the marketing budget. Various functional areas, such as marketing research, advertising and brand, will each have separate budgets that factor into the overall marketing budget. One of the largest expenses in the marketing budget is labor. Labor includes the salaries and benefits of all managers, analysts and support personnel in the marketing department. Marketing department compensation usually includes salaries, bonuses and stock distributions. Marketing benefits can include hospitalization, dental, workman's compensation and education reimbursement.
Projects
The marketing budget also includes all projects that various functional areas will complete. For example, marketing research will usually conduct surveys or focus groups during the year. Surveys and focus groups may or may not fall under the marketing research part of the marketing budget, however. Sometimes, brand or advertising will cover the surveys if a brand or advertising manager requested the marketing research surveys. Other projects that may be included in the marketing budget include new product research, competitive analyses and industry research.
Expenditures
Marketing department budgets will usually include various supplies and equipment you purchase. For example, employees will need pens, pencils, staplers, manila folders, paper clips and notepads. An executive assistant may keep track of supplies your marketing department orders. Marketing employees will also need computers and printers. Additionally, you may need to purchase copiers, fax machines, shredders and other pieces of equipment during the year. Often, equipment must be depreciated each year. In other words, equipment is worth less each year as you continually use it. Therefore, you may need to include depreciation expenses in your marketing budget.
Advertising
Advertising expenditures are also typically included in the marketing budget. Advertising can include direct mail, mailing lists used for mailings, magazines display ads, and radio and television advertising. You may also incur expenses advertising online, such as using email marketing or advertising in search engines like Google and Yahoo!. Also, any social media you use for advertising, like Facebook, MySpace and Twitter, should be included in your marketing budget.
