ask a pro
how much should I be spending on marketing?
If you think of marketing as an expense, your mindset should shift. Marketing isn’t a cost – it’s an investment that should be boosting both your revenue and business goals.
It’s very common to use a percentage of revenue as a guide for how much to invest. The SBA recommends investing 7 to 8 percent of your gross revenue on marketing. This percentage can vary drastically with each business though; it typically increases if you’re new in an industry, looking to expand, targeting consumers versus businesses, or are in a competitive market. For example, a business expanding into a new territory that’s focused on building their brand might spend up to 20% of revenue on marketing, much more than an already established company trying to maintain their current state of business.
No matter what you’re investing, you can maximize success in a two key ways:
- Develop a marketing plan and revisit it often so your marketing spend is on-track and going towards areas of the most value.
- Track the ROI and success of marketing.