Marketing Budget Utilisation
Percentage of the allocated marketing budget spent in a period
What is Marketing Budget Utilisation?
Marketing budget utilisation is the percentage of the allocated marketing budget that has actually been spent. It shows whether spending is on track against the plan.
It helps finance and marketing keep a grip on spending during the year. Spending far below plan can mean opportunities are being missed, while spending far above it risks overspend.
How this KPI is measured
- Function
- Marketing
- Sub-function
- Demand Generation
- Industry
- All Industries
- Type
- Lagging
- Impact
- Financial control
- Unit
- %
- Measurement frequency
- Monthly / Quarterly
- Formula
- (Actual marketing spend / Allocated marketing budget) × 100
How to calculate it
Divide actual marketing spend by the allocated budget for the same period, and multiply by 100.
For example, if 180,000 has been spent against a budget of 240,000, utilisation is (180,000 / 240,000) x 100 = 75%.
Compare it with the share of the year that has passed. Being at 75% after nine months is on plan, whereas 75% after six months is running ahead. Track committed but unpaid spend as well as invoiced spend to avoid surprises.
Where it is used
Tracking spend against plan
See at any point whether spending is running ahead of or behind the budget.
Reallocating budget
Move money from underspent areas to those where it can be used well.
Forecasting the year end
Project the final position and warn finance early of any variance.
How to improve it
Tips and common mistakes
- Spending the whole budget is not the goal. Spending it well is.
- Compare utilisation with the share of the year elapsed, not with 100%.
- Watch for a rush to spend at the end of the year, which usually buys poor value.
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