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By: Craig Friesen. All Rights Reserved.
With an advertising budget on paper (or computer), it is easier to keep yourself on track and not over spend. Extending your finances is one of the critical mistakes many new businesses offline or online make. Spend too much money on something that gives you no return on your investment and you can quickly find yourself completely out of funds. If the reason for you advertising top affiliate programs was to get out of debt then you have just created a heap of trouble for yourself.
A Budget You Can Use:
Here is the budget framework I continue to work with. As you will see, the costs begin with the "necessities" and end up with "luxury" so if I need to cut anywhere I usually start at the bottom. However, with sales tracking in place you will also know whether a primary program needs to be dumped in which case you may also adjust the higher categories also.
Gladly copy and adapt this budget guide for your own use:
- Web site and domain registration fees - these are "hard" costs that you can't do without to run your business unless you are strictly using the links provided by your top affiliate programs.
- Top affiliate program upgrades - these are helpful but can be done away with if money becomes tight. The only thing to watch here is whether you lose anything if you change your mind after upgrading - with some top affiliate programs it may mean losing your list or downline if you downgrade.
- Advertising / Marketing - I divide this up into 2 categories:
- Subscriptions - here I include my paid Sokule networking membership, list building programs, upgraded safelists or traffic exchange memberships, etc.
- one-shot advertising - paid solo ads or purchased website visitor traffic, etc.
- Webmaster Tools - I include my autoresponders, article submitter and anything else that helps me do things I could do manually if I had the time or know-how. I bought a header creation program a while back and have used it a lot but it is still a "luxury" and I could have made do without it.
Adding Up Your Total Marketing Budget
My total budget figure is the amount I can afford to spend without any returns. That is, if I earned nothing back whatsoever this is how much I can "afford" to spend. I think of it as a business expense and very few businesses make lots of money in their first year. Unfortunately most of us who start marketing top affiliate programs or a home business opportunity can not afford to wait a year for returns.
When I earn money, I consider whether I use it to add to my budget or help pay for costs - mostly that is dependent on what is happening with my family budget. A few summers ago our family vacation was interrupted with a transmission replacement so for the next few months any commissions I made were used to reduce my out-of-pocket business expenses. I didn't enjoy that but it sure was nice to know that my normal household budget was not adversely affected.
It took me several months to come up with a budget that was somewhat stable and consistent. Now I only increase my budget if I have residual income from my top affiliate programs and if I do not specifically need that income to meet my family or personal needs.
When business opportunity or top affiliate programs become financially viable on their own (commissions are high enough to cover membership fees and advertising) I put a little star beside them on my budget chart. For me that is an initial goal - to break even in every affiliate program I participate in unless it is geared primarily for advertising.
There you have it! Build a business budget that is fair but challenging. Tinker with it for the first few weeks or months then give it a fair trial without any major adjustments. At first this may seem like a chore you don't want to do, but once you realize how much money you were overspending or paying out on credit interest advertising your top affiliate programs, you (and your loved ones) will love it!
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