The Marketing Budget Is an Output, Not an Input

How much should I spend on marketing?

I get asked this constantly, and there is a number I can give you — somewhere in the range of twenty to thirty percent of revenue is what I would tell most course businesses to plan around. Take it. It is a reasonable place to start a spreadsheet.

It is also not the answer, and I would rather explain why than let you build a business on a percentage.

Here is what I have actually learned running this, in roughly the order it becomes useful.

Marketing is not a line item. It is the line item.

In a course business there is almost nothing else to spend money on. No inventory. No premises. No cost of goods worth naming. Once the courses are built, the overwhelming majority of what leaves your account leaves it to put your work in front of people who have never heard of you.

That is worth sitting with, because it changes how the decision feels. You are not allocating a marketing budget out of a business. Marketing spend is most of what the business does with money. Treating it as a discretionary category — the thing you trim in a slow month — is how people quietly starve the only engine they have.

Spend and return track each other, right up until they don't

For a while the relationship is close to linear. More money out means more of your profession sees you, which means more revenue in.

Then it bends. And where it bends is specific to your business, your profession, and your ads, which is why nobody can hand you the number.

The way you find it is by walking up the ladder and watching. Something like this shape: put ten thousand into a month of ads and see eighty thousand in sales. Good. Push to twenty thousand the next month and see a hundred and fifty. Still good — not double, but clearly worth it. Push to thirty and see a hundred and sixty.

There it is. That third step is the whole lesson. The extra ten thousand bought ten thousand, and you have just found the edge of your current audience, your current creative, or your current offer.

I want to be careful about those specific figures — they are the shape of the curve, not a forecast for anyone. Your ladder might run in hundreds rather than thousands and bend in a completely different place. The procedure is what transfers: raise the spend deliberately, in steps large enough to read, and keep going until the return stops keeping pace. Then hold there until something about the business changes.

You will waste some money doing this. That is not a flaw in the method, it is the price of the information, and it is cheaper than guessing for three years.

Early on, the budget is buying you data

For the first six to twelve months, the honest purpose of your ad spend is not customers. It is finding out which channel your profession actually lives on, what they respond to, and where your curve bends.

Which is why I would not hire a marketer yet.

Professional marketers charge management fees — commonly a few thousand a month, sometimes much more — and that money comes out of the same pot as your ads. So the real question is never "should I get help." It is: would you rather put five thousand dollars into reaching more of your profession, or into someone who will operate the same account you could operate yourself?

Early on, ads win that comparison. The platforms are not hard. The ad managers are built for people with no training, and after a few weeks of poking at one you will understand it well enough. More importantly, you will come out the other side knowing things about your own audience that you can never fully hand off.

Later, when the business is producing real revenue and the marketing has become a burden rather than an education, hire someone — and hire a technical one, who understands the machinery and the numbers. Keep writing the copy and making the videos yourself. Nobody watches your account the way you do.

The ad manager will not tell you what worked

This is the note I wish someone had given me plainly.

Your ad platform reports clicks and click-through rates enthusiastically. What it is often quite bad at is telling you which of those clicks became a purchase. You can end up funding a channel for months on the strength of engagement numbers that never converted into anything.

So ask the customers. Put a single question at checkout, or in your email opt-in: where did you hear about us? It costs you nothing and it is the most reliable attribution data you will get.

When you run three channels and every buyer names one of them, you have just learned something no dashboard was going to tell you, and you have found the money to move.

Where the cheap reach hides

Run at least three channels. Which three depends entirely on your profession — some fields live on one platform and barely register on another, and you are the only person who can tell which. Advertising costs differ sharply between them too, so an expensive channel is only a bad channel if your people are not on it.

Then look past the obvious platforms. Professions tend to have their own rooms online — forums, message boards, niche communities, trade-specific content distributors. Advertising in those places is often startlingly cheap relative to what it delivers, because you are paying to reach a room where nearly everyone is a potential customer instead of a general audience you have to filter down to one.

Budget for people, too. If someone with a real following in your field will promote your courses on an affiliate arrangement, ten to twenty percent of tracked sales is a reasonable range, and it belongs in your marketing budget rather than being treated as something separate. It is spend that only costs you when it works, which makes it the safest line in the whole plan.

The part you pay for in content

One quarter to one half of your website traffic should eventually arrive on its own, through search, without a dollar attached to it.

That does not happen by accident and it does not happen quickly, but it is the closest thing to free reach that exists, and it comes from publishing consistently over a long enough period that search engines have something of yours to show. Every article you write is a permanent asset lowering the share of your revenue that has to be bought.

Which means the content you are not paying for is quietly part of the budget conversation, and it compounds in a way the ads never will.

So: what is the number?

The number is what your ladder tells you.

Start with twenty to thirty percent of revenue so you have somewhere to begin. Then spend the first year buying information instead of buying help — run the channels yourself, ask your customers where they came from, and raise the spend in steps big enough to read the result.

The budget is the output of that process, not the input to it. Anyone who hands you a percentage and calls it a strategy is skipping the only part that was ever going to work.