I’ve just read an article about marketing budget management which started as follows :
And then the author intended listing the “best last minute expenses”. Imagine: my surprise!
So I have some great news: I can help you become a planning god 🙂
And your financial department will never ever notify you anymore of “budget left over” since YOU who be the one managing your budget.
8 BEST PRACTICES FOR MARKETING BUDGET MANAGEMENT
1. Use a marketing budget “tool”.
Could be a MRM, CRM or the Excel sheet in which you have created your operational marketing plan. Whatever tool it is, anticipate being able to enter committed amounts according to the following chronology:
Allocated budget (Plan) => Committed budget (Purchase order completed) => Budget actually spent (Invoice received / accrals)
As you know, it is not uncommon to plan a specific budget and ultimately commit a different amount. Plan to set up a process to monitor expenses and analyze variances.
2. Prepare your team for budget management.
It happens that some managers “forget” to manage their expenses. We create the purchase order, validate the invoice and move on to something else… Clarify what you expect from your team and give them means to act accordingly. If necessary, plan a 2 hour meeting, together with your Controller, to clarify expectations and objectives.
3. Make Forecasts
Depending on what recurrence is best for you, check with your team where you stands with your expenses and what has not been committed yet .
Check what invoices have not been received and plan to follow-up with suppliers.
Prepare your forecast: should the planned budgets not committed according to the plan be reallocated/cancelled/increased…?
Should we revisit the plan, and therefore the objectives?
4. Avoid budget cuts
No financial department can cut a budget committed with purchase orders already sent to suppliers! Therefore, the sooner you make your purchase orders, the sooner you will protect yourself from a budget cut. You have spent a lot of time and energy building your plan, it is now time to commit your budget!
5. Be transparent
Are you planning on not spending it all? if so, say it! Say it! Tell your manager, your Marketing Ops , or your Finance Department. Everyone will be happy to be able to reallocate this budget. Your credibility will only be improved!
6. Think compliance
Although this may be tempting, it is not “recommended” to validate an invoice for which the service has not yet been fully rendered. (Unless payment in advance). How can you then recover this budget if the service is incorrect?
On the compliance side, there is a lot to say, but that is not the purpose of today’s post 🙂
7. Align with Finance
Organize moments of meetings and exchanges. If your financial controller sends you a provision file that you and your team don’t understand (I speak from experience 🙂), ask for clarification. Create alignment!
8.Create your own marketing budget dahsboard
And finally, have you thought about creating a dashboard to manage your marketing budget?
So, if you really have some marketing budget left at the end of the period, it will no longer be a surprise and you won’t have to rush to buy ugly goodies to use budget leftover! It will be the result of a good budget management and collaboration with your financial team.
If you look for an indicator to benchmark yourself, be aware that an good marketing budget management process will allow you to commit up to 98% of your budget. This may surprise you, but unless you have a “small” budget that is easy to manage, the budget of a large marketing team is not that simple to spend!
At your disposal to continue the discussion!
Béatrice Loriot – + 33 6 81 07 34 41 / + 34 680 907 987 – Bloriot@beautifulnumbers.fr