HOW TO CALCULATE YOUR MARKETING BUDGET—AND MAKE SURE IT'S EFFICIENT

Summary from the TLDR Marketing newsletter

Marketing budget planning for early- to growth-stage companies involves aligning spend with efficiency metrics like CAC Ratio (0.7-1.2), Payback Period (12-18 months), and LTV:CAC (3:1). Start by calculating a ballpark figure based on revenue goals and these metrics. Major budget categories include headcount, paid ads, events, tools, and miscellaneous expenses, with headcount often being the largest expenditure. Your budget process should include reconciling with forecasts, setting monthly targets, and ensuring alignment with top-of-funnel growth activities. Tracking throughout the year allows adjustments based on pacing, hiring delays, or underperforming campaigns.