As a marketing decision maker, you're probably expected to deploy available capital whenever an expansion opportunity arises or new cash flows into the business.
This doesn’t always have to happen immediately. It often occurs at the strategic planning level—for example, planning to allocate the next $100k for a summer sale and another $200k for the seasonal spike that follows. But deciding to hold spend strategically might be the smartest move for a portion of your available marketing capital. Why? Because it allows you to act quickly when the right moment or opportunity presents itself.
The Strategy Investors Use: “Dry Powder”
The concept comes from the 17th century, when armies relied on keeping their gunpowder dry and in reserve, ready to use when needed. In modern investing, “dry powder” refers to cash reserves that remain undeployed so investors can:
Meet short-term obligations
Navigate periods of uncertainty
Jump on promising opportunities quickly
The same principles can be applied to marketing strategy, which needs to take into account uncertainty, unexpected opportunities, and short-term KPIs.
How to Apply This to Marketing
1) Improve Your Ability to Capitalize on Opportunities
If your entire marketing capital is already fully allocated, your performance may be steady, but you lose flexibility. You can’t easily jump on new opportunities without reshuffling or getting approvals.
Let’s say you have a $300k budget and choose to deploy only $270k. That $30k left on the side becomes opportunity capital. Then, if you discover a new high-performing ad angle, or one of your A/B tests shows great results, you’re ready to scale fast— without delay or disruption.
Sometimes your best-performing campaigns run into budget constraints. Or a competitor launches a strong campaign, and you need to respond. With cash reserves, you can push harder on what's working, outbid competitors, or seize strategic positioning—without cutting spend elsewhere or asking for more budget.
2) Unlock Options Outside of Ad Platforms
If you're budgeting across your entire marketing operation, keeping reserves gives you the flexibility to act fast without sacrificing anything else.
For example:
Hiring a landing page expert mid-campaign
Fixing automation issues that impact conversion
Jumping on last-minute sponsorship or placement offers in highly relevant spaces
With dry powder, you can act immediately, while staying aligned with your original spending plan. That builds confidence in your ability to hit short-term targets and stick to the broader strategy.
3) Create Two “Gunpowder” Reserves
Larger Reserve (10–20%)
Use this for:
Rapid scaling of unexpected winning creatives, angles, or entire campaigns
Reacting to competitor moves
Expanding based on seasonality or fresh test data
Smaller Reserve (5–10%)
Use this for:
Quick fixes by expert service providers (e.g., media specialists, developers)
Funnel and strategy improvements that fall outside of ad platforms
Tactical enhancements that require small injections of capital
By splitting your reserves, you assign clear roles to each—ensuring you don’t mix them or run out of funds when you still have things to execute.
The Bottom Line:
Every marketer has faced a moment when they needed extra budget or resources, but didn’t have them. If your company’s budget isn’t infinite (and let’s be honest - it’s not), keeping a “dry powder” reserve could be a decisive strategic move in your playbook.
It’s not just about saving money.
It’s about having a real impact when the moment is right.