What Percentage of Revenue Should You Spend on Marketing?

If you’re running an SME or leading a growing B2B business, you’ve likely asked yourself this question. You know marketing is essential but how much is the right amount to invest?

Spend too little and you risk invisibility. Spend too much without strategy, and you burn through budget with little return.

The truth is there’s no one-size-fits-all answer. But there are industry benchmarks, strategic guidelines, and key questions you can ask to determine the right spend for your business.

In this guide, we’ll break down:

• How much other businesses spend on marketing (by industry and growth stage)
• How to adjust your marketing investment based on your goals
• What to spend your marketing budget on
• Why smart investment now creates compounding ROI later

Why This Matters More Than Ever

Too many SMEs and mid-market companies treat marketing as an expense instead of an investment.

They dabble £500 here on social media, £300 there on SEO. But without a committed strategy, consistent spend, and long-term planning, their brand remains unknown, and their pipeline underfed.

Think about it this way: If you want to grow your business by £500k this year, how much would you be willing to invest to make that happen? That’s the lens through which to assess your marketing budget not just as a percentage of revenue, but as a driver of future growth.

Industry Benchmarks: What Other Companies Spend

Marketing budgets vary widely by sector and business model. Here’s a breakdown based on research from Deloitte, Gartner, and HubSpot:

Sector	Average % of Revenue on Marketing
Tech Startups	15–25%
Professional Services (e.g., legal, finance)	3–8%
Manufacturing & Industrial	2–5%
Consumer Goods (mid-market)	8–14%
High-Growth B2B SaaS	20–40% (early-stage)
Established B2B Firms	5–10%

💡 Sources: Deloitte CMO Survey, Gartner Annual CMO Spend Survey, HubSpot State of Marketing

So why the big spread?

• High-growth companies need to acquire users quickly and demonstrate traction, so they invest heavily upfront.
• Industrial or manufacturing firms often rely more on relationships and long sales cycles, so marketing plays a support role.
• Professional services lean on trust and referrals, which requires investment in brand, content, and authority-building.

Adjusting Marketing Budget by Growth Stage

Your growth phase should heavily influence your budget:

🟢 Early-Stage or Startup

• Typical Spend: 15–40% of projected revenue
• Why: You’re building awareness, creating demand, and proving product-market fit. Expect higher CPA (cost per acquisition) at this stage.
• Focus Areas: Brand awareness, content creation, outbound lead generation, PPC for traffic.

💡 According to OpenView Partners, high-growth SaaS companies often invest up to 40% of revenue in marketing to accelerate acquisition.

🔵 Scaling or Expansion Phase

• Typical Spend: 8–15%
• Why: You’ve validated the offer and now need to increase lead velocity and nurture long sales cycles.
• Focus Areas: Email nurturing, retargeting, marketing automation, SEO, and mid-funnel content.

💡 Stat: The SaaS Marketing Benchmarks Report by David Skok suggests companies in the growth phase typically allocate 10–15% of revenue to sales and marketing combined.

⚫ Mature Business

• Typical Spend: 2–8%
• Why: Marketing becomes about efficiency keeping market share, generating pipeline, and feeding sales teams.
• Focus Areas: Conversion optimisation, CRM/email, account-based marketing (ABM), trade shows/events.

💡 Source: Gartner’s CMO Spend Survey shows that established B2B firms often reduce marketing investment to 5–8% as efficiency improves.

Where Should the Marketing Budget Go?

It’s not just what you spend, it’s how you spend it. Here’s a general rule of thumb for budget allocation:

Channel/Activity	Budget Share	Purpose
Paid Advertising (PPC, Meta, LinkedIn)	30–40%	Immediate visibility and lead gen
Content & SEO	20–25%	Organic growth, authority, long-term traffic
Email Marketing & CRM	10–15%	Nurture leads and improve lifetime value
Creative & Production (Video, Design)	5–10%	Brand building and conversion support
Marketing Tech & Tools	5–10%	Automation, analytics, CRM integration
Outsourcing & Agency Fees	10–20%	Strategic execution & specialist expertise

💡 Pro Tip: If your internal team lacks capacity or technical depth, outsourcing specific areas (like paid ads or Conversion Rate Optimisation) can significantly improve ROI.

Thinking in ROI, Not Just % Spend

Let’s say your business makes £2m in annual revenue.

• Spending 5% = £100k/year = £8.3k/month.
• If that spend delivers 5 high-quality leads per month and your average deal is worth £10k, that’s £50k/month in pipeline.
• Even a 20% close rate = £10k in revenue a 1:1 ROI monthly, with longer-term compounding impact through email nurturing, retargeting, and word-of-mouth.

💡 Source: HubSpot ROI

Marketing done right isn’t a cost. It’s a machine.

Advice for SME Leaders

If you:

• Want to scale but aren’t seeing consistent inbound leads
• Don’t have clarity on your cost per acquisition (CPA)
• Can’t track where most deals come from

Then your current marketing investment likely isn’t working hard enough.

Start by asking:

• What’s my revenue growth target?
• How many leads do I need to hit that target?
• What’s my average deal value and conversion rate?

From there, you can reverse-engineer your budget.

💡Final Tip: If you’re not sure how to benchmark your spend or allocate it effectively, get outside perspective. A well-structured strategy can often 2x or 3x ROI without increasing spend just by aligning tactics to buyer intent.

Want a second set of eyes on your marketing budget or strategy? Get in touch! We help B2B businesses get more from their marketing investment.