It’s that time again… fall is almost here, and the office is abuzz with talk of annual budget planning. Which department will end up fully-funded? Which one will be shortchanged? And if you have a new product or service you’re about to introduce to the market, you have an especially vested interested in how much investment the company will allocate towards it. After all, you’ve got to have enough resources to put your go-to-market plan into action.
But, if that’s the way you’re thinking, you’re already starting this whole thing on the wrong foot. Here’s why.
You (Probably) Have It Backwards
Traditionally, the C-suite would sit down together and hash out the company’s budget for the next year. Then marketing would learn what amount of cash they have to work with and get to work building their upcoming go-to-marketing strategy. But this is kind of a chicken-or-egg argument… and odds are good you’ve been on the wrong side of it.
Instead, your go-to-market plan should inform your budget. Start with mapping out the high-level go-to-market strategy that’s going to serve your new products or services best. Then, use that strategy to inform the time-bound, tactical go-to-market plan that will see you through to the proper execution of the strategy. The last step is to use that go-to-market plan to inform your annual budget. It’s got to happen in that order to be successful.
This way, you can protect your means and ensure you have the budget necessary to realize your strategy and plan. When businesses work the other way around and simply give marketing a percentage of revenue to run with, they miss the mark. The numbers become arbitrary, and then marketers are left either with too few resources to handle their go-to-market vision (which is ineffective) or too much budget and no strategic way to use it (which is wasteful and counterproductive).
When a CMO instead ties their go-to-market strategy to specific outcomes and uses that to inform their annual budget request, they justify their needs at the revenue table and make a case for the right amount of money required to get the job done.
Make It Tangible To Make Them Care
Now, of course, that’s assuming that marketing can build a grandiose go-to-market plan and demand enough budget to cover it all – and then have it granted to them. But this isn’t always possible. So, what happens if you approach this process in the right order, but still get denied?
First, demonstrate what you’ll have to remove from your plan if you don’t have ample budget. For example, explain that by taking out the content marketing piece of the go-to-market plan, you’re also likely impacting the objective it’s intended to hit (e.g. driving webinar registrants>attendees>opportunities>revenue). Since you used your go-to-market strategy to drive your budget planning, you can push back with clarity when your CEO or other leaders are resistant to granting you the full amount you’ve requested and show them how it’ll impact your results.
So what happens, then, if you go down this path and explain the tangible aftermath of not having the budget you need – and still get “no” for your answer? Or maybe your CEO says, “Great plan, but you need to do it for 20 percent less than you’re asking.” In this case, you’ve just been given the opportunity to prioritize.
It may not be ideal, but you can now scale back certain initiatives or get rid of an entire channel altogether based on how each element ties to your marketing objectives and corporate objectives. You should know which objectives are most important to least important, so you can nix the elements that were supposed to move the needle on the less important ones.
Measure Results In Terms Of Revenue
Now you’re squared away with your budget, and ready to get rolling on your go-to-market plan. You start implementing it, so when will you know if you’ve chosen a smart strategy and are likely to hit your goals?
Well, your time frame for measuring success depends on what your particular strategy is. If you have an account-based marketing (ABM) strategy, it could take six to nine months to see any traction. But if you have an inbound strategy, you could start measuring results in as little as six weeks.
Either way, you should have KPIs set, since your go-to-market plan is driven by objectives. As early as a month to three months in, start tracking against your leading indicators. This should give you an idea of whether or not you’re ultimately tracking to hit your lagging indicators, from a revenue standpoint.
If you’re confident in your go-to-market strategy, and the corresponding go-to-market plan you’ve created, you should feel justified and eager to make your budget requests in your annual budget planning meeting. And whether you get the full amount you’re asking for or not, you’ll be able to prioritize and enjoy far better outcomes by handling it this way. So next time someone asks, the correct answer is that the go-to-market strategy comes first… then the budget planning.
Check out LeadMD’s Revenue Acceleration Framework to learn more about identifying the optimal go-to-market strategy based on business goals and how to best layer on planning and tactics that integrate seamlessly to achieve optimal results.
Meet JT Bricker
As a strategic marketing leader, J.T. leads teams in helping clients design and execute actionable marketing and sales strategies and impactful execution that drive revenue growth and profitability. He works closely with organizations to develop a strategically grounded approach to marketing and sales with a blend of strategy, analytics, technology and creative to achieve growth objectives. J.T. works with the LeadMD team in advising clients on best practices in revenue growth strategies, strategic sales and marketing alignment, account-based strategies, demand generation, marketing technology, marketing operations, analytics and sales management. Prior to joining LeadMD, J.T. held a variety of marketing leadership and strategic consulting roles including management consultant, marketing operations, pricing and offer management, demand generation and analytics in multiple enterprise organizations.