How do you build an annual marketing plan and allocate budget across it?

Work from objective to allocation, in order.

• Start from the business goal — the revenue target and where it comes from: new customers, retention, expansion, or new markets. Each implies different marketing.
• Work backwards through the funnel. If the target is 500 new customers, and lead-to-customer conversion is 8%, you need roughly 6,250 leads, which at a 3% site conversion rate needs around 208,000 relevant visitors. That arithmetic turns a revenue target into a marketing plan and tells you immediately whether it is achievable.
• Assess the starting position — what channels currently deliver, at what cost, and where the constraint is.
• Allocate by expected return and by role. A common structure separates always-on demand capture (search, retargeting), demand creation (content, brand, social), and experiments. Reserve roughly 10-20% for testing, or the plan cannot adapt.
• Plan for the lag. SEO and content invested in Q1 return in Q3. Budget that pays back inside the year and budget that builds the asset are different, and confusing them causes the wrong cuts.
• Build in review points quarterly, with pre-agreed conditions for reallocating.

Note: Including headcount, tools, and agency costs — not just media — is what makes a plan real. Media-only budgets always overrun.