When it comes to setting up a marketing budget for your startup, considering every angle is important. Getty Images

Industry research suggests spending 5 percent to 12 percent of total revenue on an annual marketing budget. At Integrate Agency, we believe marketing spend should be determined from key data points, versus current size. We shepherd our clients through a five-step process to calculate how much they should spend on marketing to maximize their ROI.

1. Know your goals

You can't manage what you can't measure. Before you start spending, you must first set SMART goals. Challenging, but realistic, short-term goals may include:

  • Sales/revenue growth
  • Customer count
  • Consumer ratings improvement

Integrate updated Delmar Systems' website with the goal of increasing traffic that would generate leads. By having a clear goal at the forefront, Integrate created a conversion-focused website and calculated an ROI for the company (including 631.9 percent increase in new visitors and 23.9 percent increase in qualified leads).

Your goals should set a strong baseline of expectations and establish clear guidelines for the budgeting strategies to reach those goals.

2. Know your data

You can only track your goals, and tweak your spend accordingly, if you have the specific data to tell you what's working and what isn't. Some of our favorite tools include:

  • Google Analytics for visitors, bounce rate, and time on site
  • Site Checker for SEO performance
  • Conductor for content efficacy
  • Sprout Social for social media metrics

One of our clients wanted to increase its qualified leads, but before we added more dollars to the equation, a full audit of the company's digital efforts uncovered significant spend inefficiencies. The data uncovered a new strategy that led to a full revamp of its PPC campaign. This helped them save $8,000 per month and led to a 63.9 percent year-over-year decrease in cost-per-click cost and 42.3 percent year-over-year increase in click through rate.

3. Know your audience

If you have a strong concept of your customer base, you'll know where, when, and how you can best connect with them.

To this end, we are hyper-aware of our clients' seasonality and when their audience is most likely to buy (and for B2B clients, when budget review season is) so we can target their marketing budget accordingly.

Six Flags Hurricane Harbor Splashtown operates on a seasonal basis, by its very nature. Each summer, Integrate focuses on a concentrated marketing approach and last year garnered over 540 million traditional media impressions in just four months.

This activity has ensured they're top-of-mind when it matters most, versus spending dollars when their customers are not considering this purchase.

4. Know your competition

Regardless of market share, it's important to keep up with what competitors are doing. We recommend beginning your competitor research with:

  • SEM Rush for SEO keyword research
  • Majestic SEO for linking statistics
  • Ahrefs for backlink strategy
  • Moz for rank tracking

When Escalante's sought to outmaneuver its competition with digital tactics, Integrate's competitive data revealed that none of its competitors in a specific neighborhood were being overly aggressive online.

By focusing on geo-targeting and ad scheduling to ensure ads displayed to the preferred audience at the right time, the restaurant has been able to capitalize on specific traffic without a large budget.

5. Know your capabilities

A question will often come up about in-house vs. outsourced marketing. In-house gives you maximum control. But, to be most effective with your spend (and often attune to the latest, best-in-class, industry techniques), you must fully commit to your marketing efforts, which an agency, or outside partner, can provide.

As one client — Arthritis Relief Centers — grew, their staff no longer had the time to devote to marketing. By making the decision to work with Integrate, the company had more time to devote to patient care. This led to an over 100 percent increase in clicks to digital ads and a 56 percent decrease in cost-per-click because the client trusted the agency's digital marketing expertise.

The biggest upside to outsourcing your marketing: letting your team focus on servicing customers and improving your products.

As we stated earlier, the experts tell you that your marketing spend should normally live between 5 and 12 percent of your gross revenue, but we believe your marketing budget, and the integrated mix of how that budget is implemented, should be tied to growth needs and goals.

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Allie Danziger is the founder and president of Houston-based Integrate Agency, which focuses on digital marketing and public relations.

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7 can't miss Houston business and innovation events for July

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Editor's note: While many Houstonians are flocking to vacation destinations, there are still plenty of opportunities to network and learn at tech and business events for those sticking close to home this month. From an inaugural biotech summit to the 12th edition of a local pitch showcase, here are the Houston business and innovation events you can't miss in July and how to register. Please note: this article might be updated to add more events.

July 10 - Out in Tech Mixer 

Out in Tech Houston provides an inclusive networking space for LGBTQ+ people and allies working in tech. Check out this relaxed, social-mixer event, hosted on the second Thursday of every month.

This event is Thursday, July 10, from 7 to 8:30 p.m. at Second Draught. Register here.

July 14 – Latinas in Tech Coworking Day 

Connect with fellow Latinas in the industry at Sesh Coworking. Network or work alongside peers, board members and community leaders in a shared office environment.

This event is Monday, July 14, from 9-11:30 a.m. at Sesh Coworking. Find more information here.

July 17 – UTMB Innovation VentureX Summit

Attend the inaugural UTMB Innovation VentureX Summit, where innovators, entrepreneurs, researchers and investors will dive into the future of biotech. Expect panel discussions, fireside chats, a technology showcase and networking opportunities.

This event is Thursday, July 17, from 7:30 a.m.-4 p.m. at The University of Texas Medical Branch at Galveston. Find more information here.

July 17 – Open Project Night 

Collaborate on solutions for some of Houston’s most pressing issues at this month’s Open Project Night at Impact Hub Houston. Hear from guest speakers and listen to open mic pitches. July’s theme is Decent Work & Economic Growth.

This event is Thursday, July 17, from 5:30-7:30 p.m at Impact Hub Houston. Register here.

July 24 – NASA Tech Talks

Every fourth Thursday of the month, NASA experts, including longtime engineer Montgomery Goforth, present on technology development challenges NASA’s Johnson Space Center and the larger aerospace community are facing and how they can be leveraged by Houston’s innovation community. Stick around after for drinks and networking at Second Draught.

This event is Thursday, July 24, from 6-7 p.m. at the Ion. Register here.

July 30 – Ion Bike Club

Join Bike Houston at the Ion for a 45-minute guided cruise through the Ion District and Midtown. Afterward, enjoy a complimentary beer and network with like-minded riders at Second Draught.

This event is Wednesday, July 30, from 5:30-7:30 p.m. at the Ion. Register here.

July 31 – Bayou Startup Showcase

Hear pitches from startups and small businesses from Rice University’s OwlSpark and the University of Houston’s RED Labs accelerators at the 12th annual Bayou Startup Showcase. Read more about this year’s teams here.

This event is Thursday, July 31, from 3:30-7 p.m. at the Ion. Register here.

Houston researchers: Here's what it takes to spot a great new idea

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Having a “promotion focus” really does create a mental lens through which new ideas are more visible.

Key findings:

  • New ideas can be crucially important to businesses, driving innovation and preventing stagnation.
  • Recognizing those ideas, though, isn’t always easy.
  • Nurturing what is known as “promotion focus” can help managers spot fresh ideas.

Whenever the late surgeon Michael DeBakey opened a human chest, he drew on a lifetime of resources: the conviction that heart surgery could and should be vastly improved, the skill to venture beyond medicine’s known horizons and the vision to recognize new ideas in everyone around him, no matter how little formal training they had.

Appreciating new ideas is the heartbeat of business as well as medicine. But innovation is surprisingly hard to recognize. In a pioneering 2017 article, Rice Business Professor Jing Zhou and her colleagues published their findings on the first-ever study of the traits and environments that allow leaders to recognize new ideas.

Recent decades have produced a surge of research looking at how and when employees generate fresh ideas. But almost nothing has been written on another crucial part of workplace creativity: a leader’s ability to appreciate new thinking when she sees it.

Novelty, after all, is what drives company differentiation and competitiveness. Work that springs from new concepts sparks more investigation than work based on worn, already established thought. Companies invest millions to recruit and pay star creatives.

Yet not every leader can spot a fresh idea, and not every workplace brings out that kind of discernment. In four separate studies, Zhou and her coauthors examined exactly what it takes to see a glittering new idea wherever it appears. Their work sets the stage for an entirely new field of future research.

First, though, the team had to define their key terms. “Novelty recognition” is the ability to spot a new idea when someone else presents it. “Promotion focus,” previous research has shown, is a comfort level with new experiences that evokes feelings of adventure and excitement. “Prevention focus” is the opposite trait: the tendency to associate new ideas with danger, and respond to them with caution.

But does having “promotion focus” as opposed to “prevention focus” color the ability to see novelty? To find out, Zhou’s team came up with an ingenious test, artificially inducing these two perspectives through a series of exercises. First, they told 92 undergraduate participants that they would be asked to perform a set of unrelated tasks. Then the subjects guided a fictional mouse through two pencil and paper maze exercises.

While one exercise showed a piece of cheese awaiting the mouse at the end of the maze (the promise of a reward), the other maze depicted a menacing owl nearby (motivation to flee).

Once the participants had traced their way through the mazes with pencils, they were asked to rate the novelty of 33 pictures — nine drawings of space aliens and 24 unrelated images. The students who were prepped to feel an adventurous promotion focus by seeking a reward were much better at spotting the new or different details among these images than the students who’d been cued to have a prevention focus by fleeing a threat.

The conclusion: a promotion focus really does create a mental lens through which new ideas are more visible.

Zhou’s team followed this study with three additional studies, including one that surveyed 44 human resource managers from a variety of companies. For this study, independent coders rated the mission statements of each firm, assessing their cultures as “innovative” or “not innovative.” The HR managers then evaluated a set of written practices — three that had been in use for years, and three new ones that relied on recent technology. The managers from the innovative companies were much better at rating the new HR practices for novelty and creativity. To recognize novelty, in other words, both interior and external environments make a difference.

The implications of the research are groundbreaking. The first ever done on this subject, it opens up a completely new research field with profound questions. Can promotion focus be created? How much of this trait is genetic, and how much based on natural temperament, culture, environment and life experience? Should promotion focus be cultivated in education? If so, what would be the impact? After all, there are important uses for prevention focus, such as corporate security and compliance. Meanwhile, how can workplaces be organized to bring out the best in both kinds of focus?

Leaders eager to put Zhou’s findings to use right away, meanwhile, might look to the real-world model of Michael DeBakey. Practice viewing new ideas as adventures, seek workplaces that actively push innovation and, above all, cultivate the view that every coworker, high or low, is a potential source of glittering new ideas.

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This article originally appeared on Rice Business Wisdom.

Jing Zhou is the Mary Gibbs Jones Professor of Management and Psychology in Organizational Behavior at the Jones Graduate School of Business of Rice University. Zhou, J., Wang, X., Song, J., & Wu, J. (2017). "Is it new? Personal and contextual influences on perceptions of novelty and creativity." Journal of Applied Psychology, 102(2): 180-202.