You will set a monthly marketing budget in time and money and keep part of it aside for tests.
Ask a small business owner what their marketing budget is and the answer is often "whatever's left at the end of the month". Some months that is a few hundred dollars. Some months it is nothing. Their own hours never appear in it at all, even though those hours are usually the largest cost.
This exercise sets a monthly budget you can explain, in both money and time, with a small part kept aside for tests. Allow about thirty minutes, and have ready the budget sheet template below this lesson, your goal and channel numbers from lesson 6.1, and your lifetime value and maximum acquisition cost from lesson 6.3.
There are three common ways to set the total, and each answers a different question.
A share of revenue sets marketing as a fixed slice of what the business takes in, say a set percentage of last year's monthly revenue. It is easy to explain and keeps spending in line with what the business can carry. Its weakness is that it ties spending to the past rather than to what the goal needs.
The task method starts from the goal. You list the work your two channels need each month to hit the numbers from lesson 6.1, then cost each task. It takes longer but gives a budget that matches the plan.
The affordable-loss method asks what you could spend while learning and not mind losing if it brought in nothing. It suits a new business, or a new channel, where you don't yet know what works.
Pick one as your main method and use another as a check. If the task method says you need S$1,500 a month and a share of revenue says S$400, the gap tells you the goal may be too big for the business right now, or the plan too expensive.
Write down the hours each channel takes each month, then put a value on them. Use what you earn per hour from your paid work, or what you would pay someone else to do the task.
This feels odd at first, because no money leaves your account. But the hour you spend writing captions comes out of the hours you could teach, bake or sell. If posting takes ten hours a month and your time is worth S$40 an hour in example figures, that channel costs S$400 a month before you spend a dollar on it. Seen that way, some "free" channels turn out to be the most expensive thing in the plan.
Don't put all the money in one figure. Separate it into at least three lines: tools (scheduling apps, an email platform, a website plan), design and production (photos, video, printing, any freelancer you pay), and ad spend (the money that goes straight to the platform).
Splitting it shows you where the money actually goes. It also makes problems visible. If tools cost more than the ads they support, or design eats the whole budget and leaves nothing to put the design in front of anyone, you will see it on the sheet.
Keep a small, fixed amount each month for trying something new: a different message, a new audience, a channel from your "Not now" list in lesson 5.4. The amount should be one you can lose without it hurting the main plan.
Before each test starts, write its stop rule. The rule names three things: what you are testing, how much time or money you will give it, and the result that means it failed. For example: "Run a referral offer to current parents for four weeks. Stop if fewer than three families take it up." Writing the rule first protects you from the most common mistake, which is quietly extending a test that isn't working because you've already spent on it.
Here is Priya's budget sheet for her tuition centre. All figures are examples. She used the task method and checked it against a share of revenue, which gave a similar total. Her time is valued at S$50 an hour.
Google Business Profile: 4 hours a month, worth S$200. Money: S$0 in tools, S$150 for new photos once this quarter. Monthly WhatsApp update: 3 hours a month, worth S$150. Money: S$0. Tools: S$30 a month for a design app and a simple form builder. Test budget: S$200 a month. Test 1 is a search ad for "P5 maths tuition" plus her area, running for four weeks at S$50 a week, stopped if it brings fewer than four enquiries. Test 2, next month, is a referral offer to current parents.
With the photos spread across the quarter, her monthly total is about S$280 in money including the test, plus S$350 in time, or roughly S$630. Over a three-month term that is about S$1,890. Against her goal of 20 new students, the planned cost is about S$95 per student if the plan works, well under the S$300 maximum she set in lesson 6.3, and the gap gives her room. If enquiries come in slower than planned, she can spend more before the sums stop working.
Read your finished sheet against two questions. Does the total, including hours, fit what the business can carry without strain? And does the planned cost per customer sit below the maximum from lesson 6.3? If either answer is no, change the goal, the channels or the spend now, while it is still a spreadsheet.
Open the budget sheet and fill it in channel by channel. Write the hours first, before the money, because the hours are the line people most often leave out.
Fill in the budget sheet with monthly hours and dollars per channel, a test budget, and the stop rule for each test.
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