What are factors to consider when budgeting for a MA solution for a SME ?
It is function of objectives that SME has...
This is a purely tactical question. The correct answer depends on the context. Hence whatever number you throw is definitely going to be a wrong answer.
I strongly recommend that one should have a clear GTM strategy first. Understand your Ideal Customer, understand your Total Addressable Market, decide the desired results and determine the metrics to track your progress. After this strategy then you think of execution of this strategy. If you determine that marketing automation platform is a part of this overall strategy, then you think of how much budget you need to spend on it. The answer will be clear to you and accurate as well.
Typically, for SMEs with a justified marketing automation need, budget normally varies between 5-20% of the marketing budget excluding HR / personnel cost. This percentage may vary depending upon marketing objectives and the ecosystem. And by thumb rule, 20% of marketing budget can be invested in technologies and tools that help amplify efficiency, productivity and / or outcomes.
However, I concur with Sesha Rao's and Sowmya Moni's views. Without a clear cut strategy and visibility into the GTM engagements, it is difficult to even ascertain the need for Marketing Automation. Within Marketing Automation, there are 100s of areas for consideration - for that matter, even content scheduling is considered as a type of automation. Defining where we need automation could be the first step, post which we could evaluate the tools and their value for money in line with budget availability.
One cannot define a magic %age of their marketing budget for the perfect marketing automation of their company. Every business is unique, with specific needs, resources and goals and those factors should be evaluated to determine the most appropriate budget.
I completely sync with all the comments above, and as Ganeshkumar S said, "even content scheduling is considered as a type of automation," marketing automation is a broad term so it is critical to clearly define "marketing automation" for your company before placing a budget around it.
That said, 5-30% of your marketing budget could be allocated to marketing automation, with entry-level automation products like HubSpot Free/Starter. To narrow that range - if you just started exploring the idea of marketing automation for your company, start with the low-cost marketing automation tools like. Understand the available automation tools, their capabilities and the ones that fit your needs. To define your marketing automation budget you will also have to consider the return on investment through online marketing activities, your target audience if they are businesses or end users.
Also look at your peers in the industry and what percentage have they allocated to marketing automation. Be realistic and do not compare the marketing automation budget or percentage of the incumbents. Their marketing strategy and goals will vary significantly to yours.
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