How much do u spend each month on marketing?

F

fundone2000ld

New member
Hi all, I’m looking to get some benchmarks around how much each startup spends on marketing.

TLDR; we decided to bootstrap and forgo the VC route a few months back so this means our numbers need to make sense. I’m in charge of sales and on average, we do approx $30k usd each month at 40% margins.

Right now, we spend approx $1k a month on google ads which is working but most of the revenue is also coming from existing customers who expanded their work with us.

We are not profitable at the moment but on track to do so. Our business is saas+service.

I see many business or startup spending 8-30k a month just on marketing. How do you decide the budget? Is it revenue-based?

Note that we are bootstrapping at the moment so growth at all cost is not possible since we won’t have VC money.
 
@fundone2000ld Without knowing your full funnel conversion rate I’ll give you the basic formula I use with industry averages and a round number!

Goal revenue: $1MM

Close rate: 20%

Goal pipeline: $5MM

Pipeline ROI: 1:15 (this varies A TON depending upon your target but a good place to start)

Marketing Spend: $333k

If you are basing it off of a % of revenue start at the bottom with your budget and work your way up to create a reasonable goal.

If paid search is working for you try to bolster it with some good SEO. This will make the ads cheaper and convert a bit better.

Use the blog content you create for SEO to start a newsletter and do some 1:1 outreach on LinkedIn, gently promote it with a value-first approach in your buyer’s communities and subreddits(if applicable).

Value-first means make sure you are giving advice and promoting yourself only when it makes sense. Don’t ham fist it in.

This comment is an example value-first. You just haven’t gotten to the promo yet 😂

I use https://www.thehiveindex.com/ to find the communities, they also have a decent list of subreddits for each topic. (Not the promo, I just like them)

This is a big part my current strategy at https://www.marketingforfounders.com/ and it’s working very well for me. (There’s the promo, super gentle)

Once you have proven out what platforms/channels are working with this manual strategy, invest into automating where possible, hire to improve capacity, and invest in ads/sponsorships.
 
@sazbastein There are lots of platforms that handle this for you and several can even create a dynamic phone number on your main page so if people click from a campaign it shows a different number and when they call it it credits that campaign.
 
@meghagupta
are lots of platforms that handle this for you and several can even cr
Click to expand...

I've never been a fan of this, cause if you stop with them and that customer has that number and calls it they won't get you and may just assume your out of business and not try again.
 
@caleb_f Suppose since they call maybe they’re already in your funnel but I get the sentiment. Kinda think most of my customers wouldn’t write the number down but would instead go back to my website. The data I get from the campaign and how effective it is is far more valuable le to me.

Maybe the 1000’s of extra money I make by knowing one campaign is driving calls would make up for the maybe one lost customer? I love when people call and I’ll do whatever it takes to drive more people there and some campaigns are just better at that than others. The data to me is super valuable.
 
@sazbastein I usually ask my customers where and how they heard about us when we get on a call. You can also consider adding a “where do u hear about us” when they check out or send follow up send
 
@fundone2000ld For your bootstrapped SaaS startup, a cautious approach would be to allocate a modest 10-20% of your monthly revenue to marketing, with a keen eye on cost-effectiveness and sustainability. Prioritize marketing channels proven to be effective, but remain vigilant about cash flow and avoid overextending financially in pursuit of growth. I found an interesting article, give it a read! https://www.cuppa.so/post/the-top-10-startup-pitfalls-to-watch-out-for
 
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