Woolley Marketing: Top down or bottom up? Which budgeting approach is best?

If you want to see terror in a marketer’s face, then start off a conversation around Zero Based Budgeting – also known as bottom up budgeting. This budgeting approach has been around for decades, but it is still feared and loathed by many in marketing. The alternative is the opposite and much more popular – top down budgeting. This is where there is a set amount to spend. The top number. And your job is to work out how, where and when to spend that amount. No more. No less.

So which approach is best? Well if you decided which is best based on popularity, the best is a top down budgeting approach. But its popularity may be due to the fact it is simply easier. After all, deciding how to spend your money can be fun. Calculating what you need and why you need it is harder. So, let’s go beyond popularity and look at the functionality. Which approach provides the better outcome?

Cartoon by Dennis Flad, with permission (2021)