How to build an efficient communication budget

Published on June 12, 2024

Communication experts shouldn’t be expected to be finance experts as well. But managing a budget is part and parcel of a communication gig, even if you don’t have any accounting or finance experience.

This article will help you understand, build, and maintain an efficient communication budget.

What is a communication budget?

Most often part of the marketing budget, the communication budget represents the sum of the tools, programs, and people involved in the growth of the business through communications.

In business, “communication” refers to all activities that allow the company to be more visible and share its message, internally and externally.

But marketing communications is something more precise – it’s how the company talks about their brand and products. In other words, it’s the media and messaging from the company to the market. This could include brand awareness, PR, advertising, external events, and more.

Want to know more about our PR strategy? Here are the 6 PR best practices we’ve learned after 6 fundraising announcements.

Why do you need a communication budget?

It may seem counter-intuitive, but communication isn’t free. Emails, messages, newsletters, social media, traditional media…communication via these platforms and programs requires money.

But not all budget items are created equal! Depending on your communication plan and your goals, you need to put more money towards the items that contribute most to your growth or to achieving your objectives.

Your communication plan should already include your priorities and preferred channels, so it will be easy to create your budget with your comms plan as a guide. A communication plan details how and when you communicate with key stakeholders. It includes who is involved in which projects, the frequency of communication, and clear timelines.

A communication budget will be a key point of reference throughout the year (or quarter). If your company is experiencing hardship, you’ll need full budget visibility in order to figure out where you can be lean and where you can splurge.

Create your communication budget in 5 steps

1. Outline your objectives or goals for the year

Would you like to increase your brand awareness? Take share of voice from competitors? Build the CEO’s personal brand? Whatever your goals are, you need to define them. They’ll dictate how you prioritize spend.

For example, spending thousands on brand monitoring tools before anyone’s heard of the brand would be a waste of precious funds.

Also, you’ll need metrics to measure these goals. It might be likes, clicks, follower count, conversions, or employee engagement score, just to name a few. Be sure to have a plan in place for how you’ll measure success and track them throughout the quarter.

2. Decide which goals have a cost connected to them

Some communication goals (more speaking engagements for the CEO, increased participation at trade shows) will be very costly.

Others (more posts on social media, thought leadership articles written by employees), won’t be quite so spendy.

Take a look at each goal and estimate how much you’ll need to spend for each. Be realistic, and put in the time to benchmark. Account for inflation and other market factors. What you spent last year might be a helpful guide to this year’s budget, but it won’t be identical. You will probably have to do more with less.

3. Use a budget template to build your budget

If the thought of starting a new budget from scratch is overwhelming (or you just don’t have the time), we’ve got a couple great (and free) templates here:

Marketing budget template (for Excel or Google Sheets)
Notion budget template

4. Add your items to the budget

Steps three and four are definitely the easiest on this list! Getting your hands on a budget template and filling in your budget items will take no time at all. Below we’ll talk in detail about what to include in your budget.

5. Track your budget in real time

With the right spend management tool, this part should be a breeze. The “real time” here is key; your budget is useless if it’s not updated regularly.

You won’t have an accurate number of how much you can spend if purchases take days to appear in the budget. And if you overspend -- it's too late. Make sure to use a reliable budget tracker to keep an eye on your expenses.

What to include in a communication budget

Every communication team’s budget will look different. But here are a few categories to include in your budget:

Communication channels

Social media costs will typically fall under this category. Whether you pay for ads or just pay for a premium account on a social media platform, you need to include it in your budget. The same goes for social media management platforms like Hootsuite.

Make sure that your budget includes internal communication system(s), external communication platforms, email software, newsletter platforms, blogging platforms, and your company website CMS.

(P.S. Accidentally paying for multiple versions of the same software or platform is a common budget killer. A spend management tool will help you gain 100% visibility over all your spend, so you see exactly where your money goes.)

Events: internal and external

Events can take up a considerable amount of your budget. Be sure to add both internal and external events to your budget if they fall under the communication team’s domain.

Check your company’s travel expense policy to see how employees should expense costs associated with traveling to and from events.

Buying stands at trade shows and conferences is usually a huge expense. Be sure to measure the return on investment carefully; if it doesn’t bring in new clients or more website traffic, then reconsider if this is the best way to spend company money.

Digital tools: subscriptions, software

Planning and organization programs like Asana or Notion would be included in this category. So would news outlet subscriptions or one-off payments.

And don’t forget visual design tools, like Canva or Photoshop.

If you use it and pay for it, it needs to be included in your communication budget.

People

Team salaries will obviously be a significant portion of your costs. If your comms team works with agencies, influencers, or freelancers, you’ll need to place them in your budget, too.

Manage your communication budget with Spendesk

Are you tired of managing your budget by hand, on a dusty Excel spreadsheet that nobody has bothered to update for months?

For all the operational people, those who build communication strategies and want to take full advantage of modern budget management tools, Spendesk is for you.

You’ll love our free tool dedicated to budget management. Follow your communication budget to the penny (and without headaches):

Spend management Business strategy

Elizabeth Dulcich

Elizabeth is a content marketer and copywriter living in Paris. She loves reading, yoga, and hiking in her native Pacific Northwest.

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Close the books 4x faster, collect over 95% of receipts on time, and get 100% visibility over company spending.

Business spending includes different types of spend:

Strategic spend is usually centralized and managed by C-level executives with dedicated spenders. It can be managed through invoices, wire transfers and purchase orders.
Discretionary and operational spend is also centralized, but spending is done by managers and employees during their daily professional lives. It includes card purchases, subscription payments, digital ads, events, office orders, and business travel.
Expenses, unlike strategic spend, represent a significant amount of small purchases that can be difficult to track. These include card payments, expense claims, team perks, and travel expenses.

Spend management is the process through which companies manage business spending. It takes into account the end-to-end process when someone needs to spend: getting purchase approvals, providing payment methods, submitting and processing invoices, submitting and reimbursing expense claims, chasing receipts and invoices for reconciliation, and assigning the right analytical codes, expense accounts, and VAT rates to all those expenses for bookkeeping.

Spend management tools become necessary when the number of employees increases and the need for clear processes, better visibility and control starts to grow for finance teams.

Employees need flexible, user-friendly tools, in order to spend easily and be empowered to do their job.

That’s when Spendesk can be a good fit.

Spendesk provides payment methods for modern businesses, and a powerful platform for finance teams to manage spending. This includes debit cards to replace old-fashioned company credit cards, virtual cards for online purchases, and automated expense reports for unexpected payments.

For employees
Employees no longer need to spend out-of-pocket. They request funds for a particular purchase, and can use their Spendesk card or virtual card to execute the payment.

If for any reason the employee can’t use their Spendesk card, they snap a picture of the receipt via the Spendesk mobile app and create an expense claim on the spot. This is sent directly to their manager for validation, and on to the finance team.

For finance teams
Each employee has their own Spendesk profile and debit expense card. So unlike the company credit card, you always know who’s spending company money.

The platform lets controllers create spending limits and pre-approvals. C-Level executives or managers will have a different level of pre-approved spend from other staff. Should a team member need to go over their pre-approved budget, they can make a request to their manager via the mobile app or the platform online.

When an expense is made with a Spendesk card, the employee simply snaps a picture of the receipt at the time of purchase. Which means no more lost receipts.

Finance teams can see real-time company spend and follow up on missing receipts or invoices by sending reminders to employees via the platform.

Reviewing expenses is also easier as finance teams can group expenses and assign them the right VAT rates and expense accounts before exporting everything easily to their accounting tools.

Spendesk streamlines the whole business spending process, making spend management intuitive, simple and efficient.