Can I Get A Business Loan For Marketing My Company?

The conditions for a business loan vary based on the lender you work with. On the other hand, traditional lenders often demand small firms to meet the following requirements to obtain funding for a marketing campaign. Apply and see other loan options, try citrusnorth.com for free today.

• At least three years in business 
• Annual revenue of $100,000 or more 
• A personal credit score of 660 or above 
• In a low-risk sector

Even if your company doesn’t match these requirements, there are still choices available to you. 

Since the start of COVID-19, lenders have prioritized cash flow over business owners’ credit scores.

Cash advance companies, for example, are willing to work with people who have terrible credit as long as their small business satisfies certain sales volume standards. Online lenders will frequently engage with a startup company that has been in operation for six months to a year.

How to Make the Most of Your Marketing Business Loan

Before you seek financing, it’s a good idea to figure out your marketing approach. 

Here are a few examples of how marketing loans are employed.

Email marketing campaigns

Sending newsletters and promotions to current customers and individuals who might be interested in your products or services is what email marketing entails. It’s one of the most cost-effective ways to advertise; all you’ll need is money to get a client management software system in some circumstances.

However, you’ll need to be consistent, and reaching a small number of people often necessitates a vast email list.

Sponsored content

Sponsored content, often known as native advertising, entails paying a publication to write an article or other piece of content about your product.

Sponsored content campaigns can help you reach a new audience while also being a more cost-effective strategy to drive sales than digital marketing. According to a 2019 study by Outbrain, native advertising click-through rates can be five to 10 times greater than a hard conversion rate approach.

However, it’s practically hard to track performance without a tracked link in the magazine, and launching a native marketing campaign can take a lot of time and money.

Campaigns on social media

Social media marketing aims to reach a new audience through Twitter, Instagram, Facebook, and other sites. You can use a business loan to buy ads, pay a staff to contact customers by posting on social media through your brand’s accounts or sponsor an influencer to obtain access to their followers.

It’s an excellent approach to connecting with your customers on a more personal level while also receiving constant feedback. However, the financial benefits of this marketing strategy may take months or even years to manifest.

Paid digital marketing

Setting up a paid advertising campaign that targets specific clients on search engine results, websites, social media platforms, and even e-commerce sites like Amazon is common in digital marketing.

For businesses that are adjusting to the change to online buying and don’t show up for popular Google searches, taking out a loan for paid digital marketing can be a worthwhile investment. 

However, it might be costly if you end yourself in a bidding battle with another company for the same advertising time.

How to Fund Your Marketing Campaign

Every marketing approach does not require a business loan. Here are some of the most frequent marketing and advertising finance methods small businesses use.

Loans from the Small Business Administration (SBA)

SBA loans and lines of credit are government-backed business loans and credit lines that can assist your small business qualify for low-cost financing. They’re instrumental if you don’t qualify for bank loans. Although the guarantee fee can make SBA loans pricey, they can be a wonderful method to fund a marketing push during your company’s initial few years.

Lines of credit

Business lines of credit allow your company to borrow money as needed. They’re better suited for ongoing campaigns because you won’t have to go through the application process every time you need more money. If you plan to invest in marketing regularly, search for a revolving credit line with a credit limit that replenishes when you repay the cash.

Term loans

When you only need money for a short period, term loans from a bank or an internet lender are ideal. Bank small business loans often have lower interest rates than those offered by online lenders, but they might be difficult to obtain if you don’t have good credit or have been in business for at least three to five years.

Credit cards for businesses

Small, one-time purchases like subscribing for a Google Analytics 360 subscription can be covered with a business credit card while collecting points. However, only use plastic for purchases that you can pay off in full each month. Interest rates on credit cards are typically greater than those on a typical loan or line of credit.

Cash advances from merchants

Merchant cash advances aren’t technically a loan; rather, they’re a deposit against your company’s future sales. Small business owners with terrible credit and companies that haven’t been established long enough to qualify for a standard business loan might consider this option.

Instead of interest, advances have a predetermined cost that you repay with a proportion of your daily sales. However, these costs can result in APRs of up to 300 percent, so they should be held for emergencies, such as when you need to quickly pivot to a new consumer base.

Microloans

Microlenders provide startup and first-time small business owners with small-dollar finance. 

Microloans are often for less than $15,000 and come with higher interest rates than you would obtain at a bank. On the other hand, these lenders are more likely to provide training to assist your company in developing its marketing plan and becoming financially solid enough to qualify for a low-cost bank loan.