Guide

How much should a small business spend on marketing?

By Social Spark · Published 10 June 2026

"How much should we spend on marketing?" is one of the most common questions small business owners ask, and the honest answer is: it depends — on your margins, your stage and how fast you want to grow.

That said, there are sensible starting points and some clear mistakes to avoid. This guide gives you a way to set a number you're comfortable with and split it so it does real work.

The common rule of thumb

A widely used guideline is that established small businesses spend somewhere around 5–10% of revenue on marketing, with newer businesses or those chasing fast growth often spending more. Treat that as a starting point, not a law. It's a way to sanity-check your number against the size of the business, not a figure to follow blindly.

What changes the number

Three things move it most: your stage (a new business usually has to invest more to get known), your margins (higher margins can support more spend), and your ambition (growing quickly costs more than holding steady). A cash-tight business with thin margins should spend carefully and measure hard; a profitable one leaving money on the table can afford to be braver.

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How to split the budget

Two splits matter. First, brand versus response: some spend builds long-term awareness, some drives enquiries now — you want both, weighted toward response when budgets are tight. Second, organic versus paid: organic content compounds slowly but cheaply; paid buys reach fast but stops when you stop. A common, sensible approach is steady organic plus targeted paid behind your best offers.

The mistakes to avoid

Two errors are common. Spending nothing — then wondering why the phone's quiet — is the obvious one. The subtler one is spending in bursts: a flurry of activity, then silence, then surprise that it didn't stick. Marketing rewards consistency. A smaller amount spent steadily usually beats a big push followed by nothing.

Start small, measure, scale

If you're unsure, start with an amount you can sustain for several months, decide up front what you'll measure (enquiries, bookings, sales — not likes), and scale up what works. The goal isn't to spend a lot; it's to spend enough to learn what returns, then put more behind that.

Common questions

What percentage of revenue should go to marketing?

As a rough guide, many established small businesses sit around 5–10% of revenue, with newer or fast-growing ones often higher. Use it to sanity-check your number against your size and margins rather than as a fixed rule.

Should a brand-new business spend more?

Usually yes, proportionally, because you're buying awareness you don't yet have. The key is to spend in a measured way and track what's working, so early investment teaches you where to put more later.

How much of the budget should go to ads?

It varies, but a practical approach is steady organic content plus paid spend concentrated behind your strongest offers. Ads buy speed; organic builds trust. Avoid putting everything into ads with nothing to convert the attention they bring.

What if I have almost no budget?

Focus on the free fundamentals first: a complete Google Business profile, reviews, and consistent owner-led content. Get the path to enquiry working, then add paid spend once there's something proven to amplify.

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