How to decide Performance marketing budget for a new brand?

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How to decide the right amount of money for performance marketing for a new brand?

I have spoken to 121 founders over the last 60 days who wanted help from me in some way or the other.

The most common question I get from these founders is-

How much money should they keep for performance marketing?

I have been saying this for years now- No one can accurately answer these 2 questions

• What’s the right amount of money for performance marketing for a new brand?

• What is the return you can expect in the first 2 quarters?

One can only make an estimate based on experience. But it is still like shooting in the dark.

Till the time one starts running ads and we see the data, it is difficult to estimate the returns sitting on the sidelines.

During the early days of my consultancy/coaching career, I always tried to avoid answering this question.

However, I realised that when a business owner is asking this question, they are not looking for accurate answers.

They are looking for accountability.

They want someone to tell them where will they land in the first 6-12 months and I am accountable to land close to that number.

However, it is difficult to answer where will the business be in 12 months when we have not even started. I still give them what they want.

This is my response:

‘In the first 3-4 months of your business operation, you should invest the amount of money that you are comfortable not getting a return against.’

If you spend ₹100, you will get ₹100 by 120th days.

If the product is great, the audience is very well defined, the brand identity and communication strategy are in place and followed, and you have built a fundamentally strong website (no cheat codes). You will land at break-even with ads in the first 90-120 days on a higher side.

By the 120th day, you will probably have many learnings:

• Your best sellers

• Best-performing creative communication

• Best audience cuts

• Primary channel

• Time lag to shop

• Impact of emails, notifications, SMS, WhatsApp and investment in these

• Promotions that do well

• Social organic DNA and approach

Thereafter you move ahead beyond 120 days with learnings and you make calculated decisions.

Why up to 120 days?

Will businesses not learn this in the first month?

No.

How do you know something is working unless you have tried it over and over 5 or 10 times?

Hence, avoid hurrying into concluding whether your marketing is working or not in the first 3 months.

Building a business is a slow process.

If you take your business like running a sprint, you will not be left with many options to try out.

Talking about challenges;

There are 2 challenges that your business will face post 120 days.

• Efficiency challenge (RoAS being low)

• Scalability challenge (not being able to go beyond a top-line without compromising on returns)

There are 25+ ways of solving these 2 challenges that I cover in the Dream Performance Marketing Masterclass.

It is a 10-session LIVE Masterclass where you will learn to solve these challenges LIVE along with me.

The entire course is designed to keep real business challenges in mind and is backed with strong case studies and a LIVE capstone project that enrolments have to work on.

I will also hire one person from this batch to work with me on an international project for 3 months.

Criteria to get hired- attend all 10 sessions LIVE and put your heart into the LIVE project.

If you like this newsletter and if you connect with my style of teaching on Instagram, you will love these 10 sessions.

As Marissa saw the impact of taking up the course:

Dream Performance marketing masterclass is a limited seats masterclass.

There are only 10 seats in each batch.

The next batch starts 4th Jan’24 onwards and you will get the recording of each session.

5 seats are already booked, grab yours now.

Cheers,

Apurv