How much should you spend on marketing your business?

Wondering how much you should spend on marketing your business? In short, there’s no definitive answer.

It’s often recommended that you spend 10% of your turnover on marketing if you’re planning for growth. Here’s what that would look like for businesses with a…

  • Turnover of £120,000 = £12,000 marketing budget
  • Turnover of £500,000 = £50,000 marketing budget
  • Turnover of £3,000,000 = £300,000 marketing budget

In reality, the 10% figure is far from gospel. If you search the web, recommendations vary wildly from 1% – 50% of turnover. Some companies (especially software companies selling online), invest even more – Salesforce reportedly spends 54% of revenue on marketing, while Marketo invested an eye-watering 66% of their turnover.

There’s other ways to look at it…

Could your business grow if you increased your spend on marketing?

If your return on marketing spend is positive, perhaps you should invest more, to gain more.

How much is a customer worth?

If customer acquisition costs are high, but your long term customer value is also high, spending more on marketing could be key to retaining their loyalty.

Could spending less be losing you money?

If you’re not spending where your competitors are, you could be losing out. An off-putting website, content that doesn’t build trust, un-targeted email campaigns, a lack of adverts in key publications: all these things can have a negative impact on your business.

What to spend it on?

Once you’ve decided what your marketing budget should be, the next question is what to spend it on. If you have a small budget, investing in outsourced marketing rather than staff could make your money go further. We’d also recommend an integrated campaign rather than putting all your eggs in one basket.

Nigel ReeceManaging Director

Investing in outsourced marketing will make your money go further

Our Marketing Services

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