How to Set a Realistic Budget


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How much money should you spend on publicity for a trade show? That depends on how much you can afford. You need an enormous budget to make a big impact, particularly if you’re just getting started. However, it is more important to be smart and aggressive than to spend a lot of money. If you present a strong position and make reporters’ jobs easier by providing good stories with appropriate background, you’ll get coverage.

There are two ways to set budgets.

Standard rule-of-thumb holds that a public relations budget should be 1 percent of sales. This percentage can vary depending on your product, its niche, or issues of timing.

Another way to set budgets is with a flat rate. Soft•letter (617-924-3944), a Cambridge, MA based newsletter covering trends in the computer software industry, conducted a survey in that showed small to medium sized software publishing companies spent between $2,000 and $3,000 a month on public relations. Larger companies spent considerably more.

To put matters in perspective, think about how much ads cost in your target magazines (usually $5,000-25,000). Calculate how much a positive review would be worth in those magazines. You can also calculate how much an ad occupying the same space as a printed review would cost according to a publication’s rate card. This calculation alone could induce you to hire a PR person to pursue editorial reviews full-time. Reviews easily justify the expense of keeping a PR person on the payroll (this assumes, of course, that the PR person is getting you reviews and stories). Take the time to do this sort of cost/benefit analysis before you plan your publicity budget.