Marketing Budget Allocation and Tracking | A Quarterly Reallocation Routine

The budget set at the start of the year no longer matches reality three months in, and yet it never gets rebuilt before the year ends. The causes are the effort of compiling the numbers and the absence of criteria for reallocating. This article sets out a routine for moving budget every quarter.

Movable Budget and Fixed Budget

Something to separate before thinking about reallocation.

Not all of the annual budget can be moved. Annual tool contracts, media inventory booked for the year, fixed outsourcing fees. None of these can be touched mid-year.

At the start of the year, split the annual budget into fixed and movable. If the movable share falls below 30 percent, a quarterly review leaves you nothing to move.

When the fixed share is too large

At renewal, check whether annual contracts can move to quarterly or monthly. The unit price rises, but the range you can move widens.

Which is better depends on how often the work changes. If you only revisit once a year, the annual contract is cheaper.

Setting the Initial Allocation

Base it on last year's results and resource concentrates on whatever worked in the past.

What to look at is where the room to grow sits. Adding to an area where you have already taken most of the market yields little.

The workable approach is three buckets.

• Foundation: stopping it lowers existing results.
• Growth: the increment needed to hit the target.
• Testing: budget that does not affect this year's numbers.

With this split, the quarterly review makes clear where to start.

The Quarterly Review, Step by Step

Even with a review meeting scheduled, it can end with numbers being read aloud. Fixing the order prevents that.

1. Produce the projected landing

Not the actual figure, but where the year ends up at the current pace.

Twenty percent attainment after one quarter looks fine, but it is a miss if the remaining campaigns do not exist. Watching only the actuals leaves you acting too late.

2. Classify the reason for the gap

Sort why target and projection diverge into these categories.

• Change in market conditions (outside your control)
• Campaign delay (a matter of capacity or approvals)
• Wrong assumption (the estimate itself was off)

The response differs by category. The first calls for revisiting the target, the second is an organisational problem, the third means swapping the campaign out.