How to Calculate Demand Gen Budget: A Rough Guide

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by Anna Munhin Dec 10, 2022 News
How to Calculate Demand Gen Budget: A Rough Guide

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Is the budget you have been given enough to do the job?

Based on the work we do with our agency's B2B clients, here's a basic, funnel-based approach to determining a realistic demand generation budget.

You should start with your revenue goal.

Define the percentage of revenue that marketing is responsible for

The online lead calculator can be used to arrive at a total number of MQLs or raw leads.

We prefer to base budgets on MQLs because they allow for different rates for different channels.

Take the number of MQLs required and divide it by $250 to come up with your demand-gen budget.

A sample calculation is available.

A close rate of 20% is needed to drive 80% of the total number of deals.

A budget of $150,000 is required for 606 MQLs.

The budget numbers don't include some things.

People, salaries, agency fees, and content are included.

Infrastructure and technology.

The traditional metric for marketing planning is 50% programs/ 50% people.

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The underlying assumptions are subject to your specific sales model, tech stack, staffing model, product category, target audience, and marketing preferences.

If you're given a budget that won't support target revenue goals, you can either ask for more money or improve the metrics.

By using intent data or artificial intelligence, you can target better-fit prospects.

Lead conversion rates can be improved by using a lead nurture strategy.

Increased effectiveness at the top of the funnel can have a big impact on the downstream.

The photo was taken by Towfiqu barbhuiya.

Republished with author's permission from original post.

Categories: Blog • Digital Marketing • Performance Metrics

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