How Much Money Should You Spend on Marketing?

Finding the Right Marketing Budget to Build and Boost Your Business

Marketing is one of the most important pieces of profitability for small businesses. “Marketing” includes everything from traditional advertising and public relations to managing Google Adwords, social media, and events. Knowing how much of your revenue to devote to marketing can be difficult to assess, but answering three key questions can help you determine how much money your business should be spending.


Who is your target audience? 

Business-to-business (B2B) and business-to-consumer (B2C) spend marketing money differently. B2B marketers use their budgets to educate their audience with detailed content and often manage a longer buying cycle than B2C marketers. Marketers for B2C businesses attempt to build emotional connections that lead to quicker closes; therefore, they manage smaller spends—generally. Knowing what you offer and who your audience is will determine the size of your marketing budget. 

What are your marketing goals? 

Setting goals for your marketing budget is important. Maybe you are trying to increase website traffic in general or would you like to see traffic increase from a particular demographic. Marketing can also be used to highlight a new area of your business that you would like to promote. Ultimately, the end goal of marketing is to capture attention and drive revenue by aiding customer acquisition and sales. Having clearly defined goals for what you want to accomplish helps set—and monitor—your spending. 

“The U.S. Small Business Association recommends that growing businesses…spend at least 7 to 8 percent [of their gross revenue] on marketing.”

Which stage of business are you in? 

The U.S. Small Business Association recommends that new and growing businesses with annual gross revenue under $5 million spend at least 7 to 8 percent on marketing. It’s important for new businesses and those looking to initially connect with their audience to devote an even higher percentage—perhaps 12 to 20 percent—to their marketing initiatives. In the early stages of a business, a solid foundation can make all the difference.  

Whatever your marketing needs, dotedison can help. From identifying your strengths and assessing your weaknesses to planning a winning marketing strategy for your business, we have the resources to take the uncertainty out of marketing. Our free marketing review can jumpstart the process and set your business up for success.