Much like the rows of jack-o’-lantern and fall décor that pop up in stores overnight each fall, the annual ritual of planning the year’s channel marketing budgets is suddenly approaching. After years of budget cuts, changes in marketing priorities, and major shifts in consumer behavior, planning for anything in this volatile economic climate may seem like a lost cause.
But when brands make smart investments in channel marketing and encourage their partners to reinvest 1% or more of their annual revenue on local marketing, they can achieve up to 30% more revenue growth. Right now, companies ache for pre-pandemic growth, and marketing often fuels that growth.
Planning your 2023 channel marketing budget involves more than just setting up a program. You have to allocate the right amount of funds to the right partners, invest in the most effective local marketing tactics, incentivize partner behavior, and ensure partners have access to the technologies and teams that can enable their success. Here are a few tips to consider as you begin planning your 2023 channel marketing budget:
Bolster partners at the Developing level to improve your brand’s local presence and, consequentially, boost revenue. When allocating channel funds, it’s safer to bet on partners who are ready to take the next step to become more mature marketers. In order to get value from the marketing funds you provide, partners must be willing to not only spend those funds, but also invest their own money into marketing. Therefore, you may consider allocating your funds based on previous usage data and rewarding partners who put financial skin in the game by marketing your brand. They shouldn’t rely on you to fund all of their marketing efforts, nor should they go it alone.
Year after year, our State of Local Marketing Research has revealed that channel partners increasingly perceive digital tactics to be the most effective way to market locally. This trend has only been accelerated as the pandemic continues to keep some consumers at home. For example, in 2020, 79% of channel partners perceived SEO to be an effective tactic. With SEO having the highest perceived impact of any tactic, companies should treat SEO as a must-have in most programs. But merely including digital tactics in your program isn’t enough. Investing in the most effective tactics also means that you need to invest in the tools and training required for channel partners to adopt them into their own strategy.
Having flexibility in your channel marketing budget empowers you to be prepared should unexpected challenges strike — and based on the past two years, marketers should get used to expecting the unexpected. You may need to pivot your marketing strategy or tactics, adapt to rapidly changing consumer behavior, join emerging social media platforms, or confront a crisis your brand is tied to. When there’s wiggle room in your budget, you can more adeptly address any of these challenges and, most importantly, continue marketing even through economic downfalls.
Above all, remember that channel marketing is a strategic investment in growing your brand, penetrating local markets, and ensuring it’s well-represented at every level. Treating marketing as just another expense on your brand’s financial statement that can be trimmed down will cost you more in brand equity than you could possibly save in dollars. So ready, set, BUDGET! 2023 is just around the corner, and we think it could be your best fiscal year yet.