What Percentage of Revenue Should Go to Marketing?

What percentage of revenue to spend on marketing

Plan to spend 5% to 9% of revenue on marketing: half the companies that answered the 2026 CMO Survey spend 5% or less, the average is 9.0%, and Gartner's large-company figure is 7.8%.

That's the honest range, not a tidy number someone made up.

The low end is what it takes to hold your place. The high end is what companies spend when they're pushing to grow. Smaller companies in the same survey report a higher share, and I'll show you how much weight that deserves.

If you're still deciding which marketing to buy in the first place, start with how to market your business, then come back here to size the budget.

First, here are the benchmarks side by side, with who each one describes.

Marketing budget benchmarks as a percentage of revenue

The number that matters most for you is 5%, the median, not the 9.0% average that gets quoted everywhere.

According to the CMO Survey 2026 Topline Report, the mean was 8.96% and the median was 5. Only 154 respondents answered the question, a 50.0% response rate, and the highest answer was 42.99%. When the average sits that far above the middle, a handful of heavy spenders are pulling it up. The median tells you what a normal company does.

The Gartner 2026 CMO Spend Survey lands at 7.8%, up from 7.7%. It's a steady number, and it describes a very different kind of company than yours.

Now hold the size rows loosely. The survey's Highlights and Insights Report shows companies under $10 million in revenue at 13.3% and companies with fewer than 50 employees at 16.3%, but the survey doesn't report how many companies answered in each size group.

The pattern isn't a clean line either. Companies at $10 to $25 million report 17.4%, companies at $10 billion or more report 9.5% against 5.7% for $1 to $9.9 billion, and companies with 2,500 to 4,999 employees report 11.5%. Smaller companies lean higher, but not in a straight line.

That's the hint worth understanding before you pick a number.

Why small businesses can't copy big-company marketing percentages

You can't copy Gartner's 7.8% because the vast majority of its 401 CMOs work at companies above $1 billion in revenue, and 7.8% of a billion is a marketing department, not a budget line.

The CMO Survey covers a wider mix, but it doesn't report how many companies answered in each size group. Meanwhile, the SBA Office of Advocacy counts 36,207,130 US small businesses, and 82.3% of them have no employees at all. Most small businesses look nothing like the companies answering these surveys.

Here's my read of why smaller companies tend to report a higher share, and it's my view, not something the survey measured. Some marketing costs don't shrink with revenue. A website, a minimum fee for managing ads, or a few hours of expert help cost about the same whether you sell $100,000 or $10 million. On a small revenue base, those costs become a big share.

If that's what's happening in your business, a higher percentage isn't overspending. It's arithmetic.

Where owners go wrong is picking a big-company percentage, finding it too small to buy anything, and deciding marketing doesn't work. The fix is choosing a percentage that fits your stage.

What percentage of revenue to budget for marketing at each stage

Budget around 5% of revenue to maintain a steady business, near 9% to grow, and above the 9% mean when you're launching or pushing hard. These are WhatShouldICharge planning bands, anchored to the survey's median and mean, not results from any survey.

Maintain at 5%. You have steady customers, referrals come in, and you mainly want to stay visible. The CMO Survey median of 5% is a fair anchor here.

Grow at 9%. You want noticeably more customers next year than this year. The survey mean of 9.0% is where I'd plan.

Launch or push above 9%. You're new, entering a new market, or trying to take share fast. I won't hand you a precise number for this band, because no survey figure is solid enough to anchor it. Set it from the customer math further down, plan it for a set period, like a year, and then come back down.

Whatever band you pick, decide it once a year and hold it. In my view, cutting marketing the month sales dip only makes next quarter harder.

Percentages only become useful when you turn them into dollars, so here's that math at three revenue levels.

Marketing budgets at $100,000, $500,000, and $1,000,000 in revenue

A $500,000 business spending 5% has $25,000 a year for marketing, or $25,000 ÷ 12 = $2,083 a month. Grow at 9% and it's $45,000, or $3,750 a month.

Look hard at the first row. At $100,000 in revenue, 5% is $5,000 a year, which is $417 a month. That's below the $500 low end of the $500 to $1,500 minimum monthly fee in WhatShouldICharge's published PPC rates. At that size, your budget buys advice and tools, and your own time does the rest.

That's why I'd push a $100,000 business toward the 9% column, or above it if margins allow. The profit margin calculator shows whether they do before you commit.

At $1,000,000 in revenue, even 5% gives you $4,167 a month, enough to buy real hours from people who do this for a living. What those monthly dollars buy, and whether to spend them on a freelancer, an agency, or a fractional CMO, is laid out in how much marketing costs a small business each month and who to hire.

A percentage is a starting point, though. The better number comes from what a customer is worth to you.

How to work out your marketing budget from customer value

Work out your budget by multiplying what you can afford to pay for one new customer by the number of new customers you need in a year. At $1,000 per customer and 20 new customers, that's $20,000.

Here's the whole chain, with example numbers you'd swap for your own. Say an average customer pays you $5,000 a year and stays 2 years, so each one brings $5,000 × 2 = $10,000 in revenue. At a 50% gross margin, that's $5,000 in gross profit.

Next, decide how much of that profit you'd give up to win the customer. If you'd spend one-fifth, that's $5,000 ÷ 5 = $1,000 per new customer. Need 20 new customers this year? Your budget is $1,000 × 20 = $20,000.

Now turn it back into a percentage to compare. If that business makes $500,000 a year, $20,000 is 4% of revenue, just under the survey median. That tells you the percentage and the customer math agree, which is a good sign.

When the two disagree, trust the customer math. Before you spend it, the project hours estimator turns a proposal's scope into hours you can check, so you can tell whether a quote's hours are honest. I use the same rates everywhere on this site, and the methodology explains where they come from.

Once you have a number you believe, the next job is splitting it.

How to split your marketing budget once you have the number

Split your marketing budget 70/20/10: 70% on what already brings customers, 20% on promising channels you're still testing, and 10% on experiments. It's a planning heuristic, not a research finding.

On a $25,000 budget, that's $17,500 for proven channels, $5,000 for the ones showing promise, and $2,500 for experiments. If you're brand new and nothing is proven yet, flip the thinking: run small tests first, and move money into the 70% bucket as channels earn it.

One more thing I'd watch. The 2026 CMO Survey highlights found acquisition budgets are 26.0% larger than retention budgets. Don't copy that by accident. The people who already bought from you are the cheapest customers you'll ever win back, and a slice of your 70% belongs to them.

To see how many hours of senior help that money buys, check the marketing consultant rate calculator for your metro.

That leaves the question everyone asks about the government's advice on all this.

What the SBA actually says about marketing budgets

The SBA doesn't recommend a percentage of revenue for marketing: its 2019 blog quotes survey averages, including 7.9% of revenue, but says there's no hard and fast answer and recommends no figure.

You'll see a specific SBA percentage repeated across the internet, and it isn't SBA advice. What the SBA blog on getting the most from your marketing budget says is: "There's no hard and fast answer to how much your marketing budget should be." It adds that many businesses use a percentage of revenue as a guide, and that startups can use projected revenue.

The more useful instruction is in the SBA's marketing and sales guide, which tells you to include a complete breakdown of the costs of your marketing plan. That's the customer math above, written down.

So pick a band: 5% to hold, 9% to grow. Check it against what a customer is worth. Write every cost into the plan, and hold the number for 12 months.

The questions below cover what owners ask most once they've got that far.