How Do You Determine Your Marketing (and Business Development) Budget?

That was the not-rhetorical question Tom Kane asked himself on the Legal Marketing Blog recently. Kane responds by saying first of all, “Some firms pick a marketing budget by what other firms ‘reportedly’ spend. You may hear that firms spend anywhere from 1% to 4% of gross revenues. Whether you are at the low or higher end of those numbers is not nearly as important as how you got there.” He goes on to advise that “Your firm’s budget should be based on what it is trying to accomplish in terms of its marketing goals. If you don’t plan before you decide to throw dollars at business development, you are wasting your money.”

This is a good point. And yet, does Kane overlook the reality of having a ballpark—“reported budgets”—in which to play around with the budget goals of one’s own firm? He does imply that it is important to have the information on what other firms are spending, though qualifies this by saying it’s more important to have a plan, some goals, a strategy.

We agree, but we have a vested interest also in helping to establish what firms of various sizes report about their spending for business development and marketing efforts within their firms. We are currently in the middle of our third annual Business Development Practices Survey, which has been tracking the gradual institutionalization of business development practices, resources, and strategies in law firms and measuring these against the same in traditional marketing/ communications efforts. If your firm has not yet participated in the survey, we invite you to do so as soon as possible. The web survey site will remain open through November. To access the survey, click here.

Comments

[Tom Kane]

Good points. Of course, I always used a rough estimate to start the budgeting process when I was in-house for the basic necessities, but again, if overall the dollars are not based on a plan, it’s likely to waste a lot of dollars.