How much to budget for database marketing vs. sales lead generation programs?

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Companies with mature database marketing programs budget less than half of their funding towards image, awareness and sales lead generation programs.

By M. H. “Mac” McIntosh, CBC

Most b-to-b marketers appear to spend 90-95% of their budget on image, awareness and sales lead generation programs, and only 5-10% on database marketing. I think this budgeting approach is dead wrong.

Instead, if you are new to database marketing consider spending approximately 70-75% of your marketing budget for image, awareness and sales lead generation programs. Then spend 15-20% of your budget to fund database marketing programs designed to nurture prospects until they qualify or buy, and spend the remaining 5-10% to target existing customers for retention and sales of other products or services, upgrades and add-ons.

Companies with mature database marketing programs—especially those who have been able to track and measure the increased sales that resulted from marketing programs aimed at their databases—often wind up budgeting less than half of their funding towards image, awareness and sales lead generation programs. Why? Because they find that they don’t need to spend as much on those objectives when they are also using database marketing programs to talk directly to sub-sets of their market.

These mature database marketers use the other half or more of their budget for funding marketing communications programs aimed directly at their databases of suspects, prospects and customers. Targeted, orchestrated, repetitive campaigns designed to identify and nurture prospects and talk to customers, maximizing the sales opportunities they represent.

Image, awareness and sales lead generation programs maintain a strong role, but sales lead generation programs work best alongside strong database marketing programs. Both aspects are important to having top-performing direct marketing solutions.

businessman in his office

M. H. “Mac” McIntosh is described by many as one of America’s leading business-to-business sales and marketing consultants and marketing speakers. He is president of Mac McIntosh Incorporated, a marketing consulting firm specializing in helping companies get more high-quality sales leads and turn them into sales. More about Mac…

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