Accounting Is Essential to Your Marketing Plan: An Interview with Marketing Expert Deimira Paa Baidoo

Accounting Is Essential to Your Marketing Plan: An Interview with Marketing Expert Deimira Paa Baidoo

Accounting Is Essential to Your Marketing Plan: An Interview with Marketing Expert Deimira Paa Baidoo 150 150 Calgary Accounting Services

At first glance, accounting and marketing seem like two separate branches of your business. Accounting deals with the financials and bookkeeping. Marketing is how you bring in new leads and engage existing ones. In reality, they go hand in hand. Marketing costs money. Done correctly, however, marketing in some form is necessary to bring in customers, and subsequently profit, for your business.

Effective marketing depends on a strategic plan and a budget. We spoke with Deimira Paa Baidoo, a business and marketing consultant with his Calgary-based firm Melcom Group Ltd, to find out more about creating a budget and strategy for advertising.

Projections and Forecasting to Guide Your Budget

Every year, your business should designate a portion of their potential earnings to marketing. This is the foundation of building your marketing strategy as what you have to spend will dictate which advertising channels you can pursue. Determining how much that budget should be is each business’s challenge.

According to Deimira Paa Baidoo, “The average business should be spending between 7 and 10 percent of its annual revenue on marketing, although this varies by industry and age of the company.”

The key to determining 7 to 10 percent – or whatever your marketing budget will be – of your revenue in the upcoming year is financial forecasting and projections. These use data from past years, industry trends, and known risks and opportunities to estimate what earnings will look like over the course of the year. Done by a professional accountant, they provide as accurate as possible a picture of your financials.

Compiling your own financial projections can be a time consuming project. It involves data collection and analysis on several key areas. If analytics aren’t your area of expertise, learning the strategies for forecasting requires additional effort.

Neglecting to forecast your overall financial situation before making your marketing decisions is even worse, whether it results in spending too much or too little. “Businesses that spend too much on advertising won’t see a return on that expense,” says Baidoo. “Or they will see a return but not have the time, staff, or finances to handle it. It requires balance.”

Overspending isn’t the only risk when it comes to marketing. Baidoo also notes, “We also have businesses that are designating the smallest possible amount to marketing and leaving thousands of dollars in unrealized income on the table.”

All marketing is an expense. Even if you are a small business relying on free strategies like social media, enacting these strategies takes time, and that has an associated cost. Start your strategy with a business projection so you know you are spending the right amount on marketing and making the most of your plan.

For forecasts and projections for your Calgary business, Calgary Accounting Services can help guide your business with our advanced data analytics. Our expert accountants take time to understand your team and your business so that we can provide the most accurate projections to help you create a marketing plan.