Marketing Budget: Three Tactics to Help You Better Allocate Marketing Costs

These days, every C-level executive expects efficient use of corporate resources. Gary Hennerberg, direct marketing consultant and author of the new book “Direct Marketing Quantified: The Knowledge is in the Numbers” (published by Target Marketing magazine, a sister publication of Catalog Success), offers these three tips to help you expertly allocate your marketing spend:

1. “If you mail to both your customer file and rented lists, separate the costs by list, so list rental is not charged to customer costs,” writes Hennerberg.

2. Evaluate the performance of small test quantities based on projected rollout costs. Writes Hennerberg, “If you’re testing a quantity of 50,000 and expect to mail it to 500,000 if it’s successful, base your evaluation of the program on the cost to produce 500,000, not 50,000. If you don’t use the rollout cost, you’ll bias your findings and your analysis will lead you to the wrong conclusion.”

3. Allocate costs for unmailed, surplus catalogs to what you actually mailed. But, says Hennerberg, if you later use those extra catalogs, “allocate the costs of the remaining circulation on the subsequent mail flights.”