Invest in yourself. Most knowledgeable marketing guides will indicate that for small service businesses, between 1% to 3% of your gross proceeds should be reinvested in marketing. Thus, if your Gross Revenues are $1,000,000 (commission income of approximately $100,000) a marketing budget of between $10,000 and $30,000 is a norm. However, not every outlay needs to be in actual dollars. Many of the marketing tactics we discuss daily in The 365 Guide are more labor than capital intensive. In fact, in a small service business like travel consulting a direct marketing approach is actually preferable to capital outlay since so much of the impact of the marketing message has to do with the people who own and operate the agency. The more the marketing plan involves direct involvement by the agency staff in events, speaking engagements, word of mouth campaigns and other public relations efforts, the lower the actual capital outlay is necessitated. Nevertheless, there is an important lesson in the simple and undeniable fact that to make money one has to spend some money.
A marketing budget is essential. Firstly, budgeting will enforce the discipline necessary to actually calendar your marketing efforts. When spending real dollars, travel agents become very cognizant of the return on investment. In addition, the marketing budget can and should include such essentials as marketing collateral (business cards, flyers, capabilities brochures), websites, advertising, dues to local organizations and promotional items, all professionally produced. Having a marketing budget, and then wisely spending it, ensures that the travel agency is doing everything necessary to keep its profile high enough to gain mindshare in the community.
A budget forces the travel agency to focus on the marketing process and to invest in growth in a responsible and predictable manner. Like the marketing plan, a budget should be in writing. Periodically, the travel agency should review its expenditures, measure return, and make appropriate adjustments.
Without dedicated resources to leverage the company profile, the travel consultant is thrown back to the early business stages of guerrilla marketing tactics that, while useful and necessary, do not permit the strongest possible growth curve. Investment in marketing accelerates growth when properly applied. Yet, too many travel agencies are loathe to invest in their own futures. They have no website, no professionally produced logo or collateral, no CRM system, no advertising or promotional efforts. Not coincidentally, they also don’t have many clients.
The timidity is understandable, but regrettable. I call it the shoestring noose. Every business should take on an investment plan for growth. The secret is to spend every dollar wisely and to then monitor results not just at the end of the effort, but throughout the duration of the marketing expenditure so that the effort can be fine tuned while in progress. Allocate money to marketing and spend it wisely, but spend it.