If you’ve ever sat in a budget meeting and felt the familiar tension between ‘we need to grow’ and ‘we need to justify every pound,’ you’re not alone. Deciding how much to spend on marketing is one of those questions that sounds like it should have a simple answer — but rarely does.
Why Having a Marketing Budget Strategy Actually Matters
Before we get into the numbers, it’s worth taking a step back. A lot of businesses treat marketing spend as something to figure out after the “real” decisions have been made. That’s usually a mistake.
A proper marketing budget does three important things. First, it forces you to think strategically about where your customers actually come from and what it costs to reach them. Second, it gives you financial control. Without a defined budget, marketing spend tends to creep up in unplanned ways, or get cut reactively when times get tight. And third, it gives you a baseline for measuring what’s actually working. You can’t assess ROI if you don’t know what you spent.
What Goes Into a Marketing Budget?
Paid Advertising
Includes social media ads, search engine marketing (Google Ads, etc.), display advertising and anything else you’re paying to put in front of an audience.
Content & Copywriting
Including blog posts, videos, case studies, white papers, social content. The stuff that builds trust and keeps people coming back.
Website Development and Maintenance
Keeping your site fast, functional, and converting. This often gets forgotten in marketing budgets but it absolutely belongs there.
Search Engine Optimisation (SEO)
Optimising your website so people can actually find you through organic search, without paying for every click.
Social Media Marketing
Whether you’re doing it in-house or outsourcing, there’s time and money involved in doing it well.
Email Marketing
Including platforms, design, list management and the campaigns themselves.
So What Should You Actually Spend?
- Startups and early-stage companies often allocate 10% or more, sometimes significantly higher. When you're trying to establish brand awareness from scratch and acquire your first customers, you need to invest to build momentum.
- Small and medium-sized businesses typically sit between 5 and 10%, balancing growth investment against operational costs.
- Established businesses may allocate a lower percentage but still maintain sizeable absolute budgets. At scale, even 5% of revenue can represent a very significant marketing operation.
- High-growth or highly competitive businesses particularly in e-commerce and SaaS, regularly spend 10 to 15%, sometimes more during aggressive growth phases.
Industry Makes a Big Difference
It’s worth knowing that these numbers vary considerably by sector. Consumer goods companies often exceed 15% of revenue on marketing. E-commerce businesses tend to sit at the higher end too, given their reliance on paid acquisition channels. B2B professional services firms usually spend less, because their growth relies more on relationships and referrals than on advertising volume. Energy and utilities sit lower still.
The point is that your competitors and peers in your specific industry are probably a more useful benchmark than the overall average. If you’re running a SaaS business and comparing yourself to an engineering consultancy, the numbers won’t mean much.
Tips for Getting the Most from Your Budget
Set goals before you set a budget.
If you don’t know what you’re trying to achieve — leads, brand awareness, customer retention — you can’t make good decisions about where to put money. Start with the objective, then work backwards.
Focus on the channels that actually work for your audience.
It’s very easy to spread a budget thinly across every possible channel and end up with mediocre results everywhere. Pick the places your customers genuinely spend time and go deeper there.
Review performance regularly.
Marketing channels that worked last year don’t always perform the same way this year. Build in the habit of looking at what’s actually delivering results and adjusting accordingly.
Don’t underestimate digital.
It consistently offers more measurable, targetable and cost-effective reach than traditional advertising for most businesses. Paid search, content marketing, social and email are worth understanding properly even if you’re not ready to invest heavily in all of them.
Your Own Data Is Worth More Than Any Benchmark
Here’s something the draft we were working from got right: industry averages give you context, but your own historical data is often more valuable.
If you’ve been running marketing activity for a few years, look back. What did you spend? What grew? Which channels delivered the most customers? If you increased your budget and revenue followed, that’s real evidence. If you’ve been spending the same amount for years and not seeing growth, that’s telling you something too.
Benchmarks are a starting point. Your business’s own track record is the more reliable guide.
What Happens When You Get It Wrong in Either Direction
Spending too little tends to result in low visibility, a weak pipeline and a brand that struggles to stay front of mind with potential customers. It’s a slow problem, but a real one.
Spending too much, or spending without a clear strategy, leads to rising customer acquisition costs, channel saturation and diminishing returns. More spend doesn’t automatically mean more growth.
The goal is an allocation that’s calibrated to your actual objectives and structured sensibly across the channels that work for your business.
What’s Next?
Remember, investing in marketing is an investment in the growth and success of your business. Figuring out the right budget for your business is genuinely worth the time. It’s one of those decisions that shapes everything downstream, which channels you can invest in, how quickly you can grow, and how confidently you can plan.
For guidance on how to define and structure that model, explore our complete guide to marketing budget strategy.