Digital marketers budgeting for 2010: Feels like throwing darts blindfolded

It’s a Saturday afternoon in late October, and that can only mean two things: time to watch college football, and time to do budgets.

As I’m working on my 2010 budgets, I’m wondering what the point of this exercise is.  Sure, budgets used to serve a very important purpose in business.  But after the volatility nearly everyone has experienced in their business in the past year or so, I don’t think there are many executives in any industry who are confident in their budget plans for next year.

Earlier this year, Business Finance magazine ran a cover story called “The Budget (1922-2009)” in which the author announced that the traditional way of budgeting had finally died.  And a new video on Business Finance website called Death of the Budget explores the topic in a similar way.

If the budget – which is a 13-15 month look into the future – is dead for most businesses (as many in the finance community are beginning to argue), that must mean budgets are even more dead within the digital marketing business.  How can you budget revenues, costs, or even have the foggiest of ideas what you’re going to be doing in December 2010 in such a dynamic business climate?  Think about how 15 months ago Twitter was still in its infancy as a marketing tool, few companies were using Facebook for business purposes, and the banner ad was still enjoying reasonably good click-through rates.  So what will the next 15 months bring, and how dramatically could those events completely destroy your budget plans by the end of 2010?

Long-range planning is a good thing for businesses -- but within the realm of digital marketing, I feel like the one-year budget is starting to feel like a three-year or five-year strategic plan used to feel – uncomfortable to put together at best, and the equivalent of throwing darts with your eyes closed at the worst.  I’d expect to see the most forward-thinking digital marketing companies using shorter budgeting cycles – maybe three month or six month cycles to determine revenues and spending.  For these companies, a yearly financial look ahead will be limited to strategic exercises.

Photo by wili_hybrid