How to Easily Create a Communication Budget
Last update: 21 February 2024 at 09:45 am
3.67/5Defining a communication budget, or marketing communications budget, is far from easy because many factors come into play to determine it. For example, your communications budget will depend on
- The total budget of your company (how much money they are willing to spend on marketing)
- The channels you will use to reach your audience (Facebook Ads will be cheaper than TV ads)
- The type of content you need to create (a blog post will be more affordable than a video)
It is, therefore, challenging to say precisely how much you should invest. However, we do know that communication is an expense item often neglected, especially in VSEs and SMEs.
However, communication must be part of your business’s marketing efforts and overall marketing plan.
Whether it is to :
- develop your notoriety,
- improve your brand image,
- prepare for potential reputation crises.
This article gives tips for defining your marketing and communications strategy budgets.
Planning the Size of Your Marketing Communications Budgets
Since the concept of communication (more commonly known as public relations) falls under the marketing department, you will most likely address the overall marketing budget any time you refer to communications budgets.
Before defining a budget, you must know your communication and marketing objectives.
For a marketing plan, these objectives should depend on what your company is trying to achieve. You could be :
- Looking for growth
- In a moment of change or challenge
- Looking to maintain your current revenue, but in a more efficient manner; perpetual motion
For a communication plan, your goals may resemble:
- To get people talking about you and your products and services,
- To communicate at an event,
- To attract new customers,
- To create a positive image of your company
In other words, your goals will depend on your company’s current and ideal future situation.
Any B2B or B2C company should strive for a marketing budget equal to 5 and 25% of the company’s total revenue.
At Sortlist, with over 33,000 marketing projects posted in 2022 on our website, we have estimated marketing budgets based on work conducted between our clients and our agencies.
- Companies looking to work on their growth had marketing budgets estimated at $59,371
- Companies in a moment of change and or challenge at $44,583
- Companies looking to maintain their revenue of $38,362
You can read more about how we calculated these prices from our marketing plan cost article.
Within that marketing budget, you must find the budget you wish to allocate for communication.
Marketing communication budget when working with a PR agency
Effective communication and building a budget presents a challenge for many businesses as it touches upon many elements and requires a specialized team to carry out successfully.
However, companies often underestimate the time and financial resources necessary for any communication project and struggle to achieve their desired results.
In 2022, Sortlist received over 2,000 project briefs from businesses seeking a public relations agency.
While these companies recognized that their communication project was better off in the hands of an agency, a comparison between the estimated budgets of their projects and the average median price of public relations work in the same year reveals this lack of understanding regarding the extent of effort involved in communication projects.
Companies expected their public relations project at $16,091. However, the median price of public relations works fell between $27,934 and $39,376.
As mentioned above, communication encompasses various marketing expertise agencies must focus on, such as branding, social media, media planning, etc.
Based on the public relations projects conducted by Sortlist agencies, the most common supplementary expertise was:
- Social media (appearing in 39% of public relations projects)
- Branding (29%)
- Graphic design (15%)
- Event marketing (14%)
Depending on whether you are looking to work on your identity, improve your communication with your audience, or prepare for a crisis, a public relations agency will factor in the necessary additional expertise into your communication plan and provide you with the required budget.
However, if you want to conduct the project independently, here are several factors to consider when developing your budget based on your desired scope of work.
The various expenses in a communication budget
Establishing a coherent action plan with a clear idea of its cost is not easy. This section details the different budget lines to be included in your communication plan.
The Identity of Your Company
This is the cost of making your company easily identifiable.
- The logo is an essential element of your company’s communication. Not everyone can improvise as a graphic designer, and entrusting the creation of your logo to an agency specialized in visual identity is crucial. Once the logo is created, it must be deployed on different communication supports: social networks, business cards, goodies, etc.
- Your company’s website and social networks must be handled because digital is becoming increasingly important. Here, the costs to plan will be mainly for content creation (blog articles, publications on social networks), maintenance costs (hosting of your website), and the costs of creating the website. You can, of course, do everything in-house. But given the speed with which digital evolves, it is more interesting to work with web development and social media agencies.
Event-Driven Communication
Event communication applies to two types of events: those you organize and those you participate in.
- If you are organizing an event, you will have to plan for these expenses: advertising (urban billboards, press, or radio), print communication (flyers, posters), goodies, street marketing operations, venue rental (if necessary), services (music, audiovisual, photography, catering), etc.
- If you participate in trade shows to improve your visibility, you will have to plan the cost of your stan and the price of your entrance ticket but also plan the costs related to your communication to let people know that you will be present.
Marketing Communication
Marketing communication, or integrated marketing communications strategies, allows you to address your audience directly.
- Street marketing allows you to attract customers by prospecting them near your point of sale, but several costs are to be foreseen. The production of flyers and samples, the service of commercial animators, the signage (advertising backpack, ephemeral stand), etc.
- Advertising is everywhere: in sales outlets, in the urban landscape (bus wraps, digital panels in shopping malls or train stations, backlit panels in parking lots, at bus stops, in train stations or the city), in the press (newspaper inserts) or the media (television, radio, cinema). Your budget will not be the same depending on your chosen channels.
Inbound Communication
Communication with the customer must be a two-way street and is incomplete without gathering feedback and complaints from prospective and existing customers.
- There are multiple channels that a customer may opt to reach out from. This could include your business phone number, live chat, email, or even through social media platforms. While some of these channels are free, others require investments in setting up and operating the infrastructure.
- Your budget should also account for the salaries of the personnel manning these communication channels. It is a good idea to opt for a unified communications system that improves the customer experience while allowing the same person to handle communications from multiple channels.
Digital Communication
Digital communication includes several actions:
- Communicating on social networks can increase your visibility. Most social networks allow you to create ads or make sponsored posts. The more money you invest in promoting an ad, the more likely you are to reach your audience. Your budget will influence how long your ad will be visible. And therefore on the number of people you can get. With an AI ad maker, you can streamline the ad creation process, optimizing your budget to target and engage your audience with compelling advertisements effectively.
- Collaboration with influencers can also have a significant impact on your communication. Indeed, you can have your company’s image endorsed by influential people who share your values. You can either make an in-kind partnership or a cash partnership. This will allow you to easily reach your audience through influencers relevant to your brand.
- Natural referencing should not be neglected, either. Indeed, SEO answers to many rules that must be respected to be correctly referenced on Google. You could take care of it internally, but we advise you to entrust this mission to an SEO agency. Things evolve quickly, and only a specialized agency can stay current with the best practices.
- It is also possible to run a paid search campaign to jump on the first page of search results.
Pros of working with a communication agency
Working with a public relations agency offers numerous advantages over handling a communication project in-house.
Firstly, agencies bring a wealth of expertise and experience to the table. They deeply understand the ever-evolving media landscape, possess valuable industry connections, and are informed on effective communication strategies. By leveraging their knowledge and networks, agencies can help businesses navigate the complexities of communication more efficiently.
Agencies also provide a fresh and objective perspective. They bring an outsider’s viewpoint, which allows them to identify unique angles and opportunities that an in-house team may have overlooked.
Working with a public relations agency also gives businesses more niche communication skill sets. Agencies have dedicated professionals skilled in various areas, including media relations, crisis management, content creation, promotion, and social media management. By taking advantage of these specialized skills, companies can ensure that their communication efforts are executed with high professionalism and expertise.
They get resources, scalability in terms of people, and they can scale their activity. They get experience from not just one person, but a whole team.
Amy Cuthbertson
Communication Budget: Conclusion
There are a lot of different expenses in communication, and it would be inefficient to be everywhere at the same time. Using your marketing budget in different initiatives is essential in the best possible way. Define and choose your battles on your approach to media relations, select specific channels, and stay the course.
Thus, only implement the most relevant actions for your communications strategy success. In addition, don’t forget to measure the impact of your communication actions: this is the best way to know if your investments in communication objectives are worthwhile.
Finally, at the start of your business, we advise you to invest between 10 and 20% of your projected turnover to implement adapted communication actions. This proportion can increase if your sector is very competitive.
Once your company is well established, this proportion can be reduced to 5% if you are a B2B company or 10% if you are a B2C company.
