How Much Should a Small Business Spend on Marketing?

A commonly cited benchmark, and a reasonable starting point, is 7–10% of revenue for an established small business focused on maintaining its current position, rising to 12–20% for a business actively pursuing aggressive growth or entering a new market. Very early-stage or pre-revenue businesses should think in terms of a fixed, affordable monthly amount rather than a percentage of revenue that doesn’t yet exist meaningfully. These are starting ranges, not rigid rules — the right number depends more on your specific goals and competitive landscape than on hitting an exact percentage.

Why percentage-of-revenue is a useful starting frame, not a fixed law

Tying marketing spend to revenue keeps the investment proportional and sustainable as a business grows or contracts, rather than either overspending during a lean period or underspending during a strong one. But the specific percentage should flex based on what you’re actually trying to achieve: maintaining steady, already-established demand requires meaningfully less investment than actively trying to double revenue within eighteen months, even for two businesses of identical size and current revenue.

How business stage should shift the number

A brand new business with no existing customer base or search visibility typically needs to invest more heavily, proportionally, than an established business with years of accumulated reputation, reviews, and organic rankings already working in its favour — you’re building from zero, and that costs more per new customer acquired in the early period than it will once foundational visibility exists.

An established, stable business primarily focused on steady maintenance and modest organic growth can often operate at the lower end of the range, since much of the foundational work — website, core SEO, established Google Business Profile — is already in place and simply needs consistent upkeep rather than being built from scratch.

A business actively pursuing an aggressive growth target, launching a new product line, or expanding into a new market (including, for South African businesses, expansion into Western markets like the US) should expect to invest meaningfully above the baseline range, since new-market entry effectively means rebuilding visibility and trust from a much lower starting point in that specific market.

How to think about the split between channels

Within whatever total budget you land on, the split between paid advertising, SEO and content, and website or technical investment should reflect your specific timeline and business type, a decision we cover in more depth in our piece on Google Ads versus SEO. A rough, commonly reasonable starting split for an established business with a moderate growth goal might allocate somewhere around 40% to paid advertising, 40% to SEO and content, and 20% to website, technical, and tooling costs — though this should shift based on your specific competitive situation and how quickly you need results.

What most small businesses actually get wrong about budgeting

Underspending during good months, treating marketing as the first thing to cut when cash is tight, then wondering why growth stalls a few months later. Marketing spend has lag — the effects of this month’s investment often show up two, three, or six months later, meaning cutting it during a slow month tends to produce an even slower period further down the line, right when you can least afford it.

Overspending on a single flashy tactic — an expensive rebrand, a big one-off campaign — while under-investing in the unglamorous, compounding fundamentals like consistent content and Google Business Profile management that tend to deliver more reliable, sustained return over time.

Setting a budget without a clear goal attached to it. “We should probably spend more on marketing” isn’t a plan — “we need 15 new enquiries a month to hit our growth target” is a plan, and it should inform both the total budget and the channel mix far more directly than a generic industry percentage benchmark alone.

A realistic scenario

Imagine a two-year-old landscaping business in Constantia doing roughly R80,000 in monthly revenue, currently spending almost nothing deliberately on marketing beyond occasional word-of-mouth. Applying the 7–10% maintenance benchmark suggests roughly R5,600 to R8,000 a month as a reasonable starting investment for steady, modest growth — enough to fund consistent local SEO fundamentals, some Google Business Profile management, and a modest, targeted paid ads presence, without stretching into territory that isn’t sustainable if a slow month arrives. If that same business set an aggressive goal of doubling revenue within a year, the more realistic starting range shifts closer to 15–20%, reflecting the more intensive, faster-paced investment aggressive growth genuinely requires.

What to do if you genuinely can’t afford the recommended range yet

A smaller, well-targeted budget consistently invested in the highest-leverage activities — an optimised Google Business Profile, a handful of genuinely useful content pieces, basic technical website health — still produces meaningful results over time, even if it’s below the ideal benchmark range. The bigger risk isn’t spending slightly below a generic recommended percentage; it’s spending nothing at all, or spending inconsistently in unpredictable bursts that never build any real momentum.

Reviewing and adjusting over time

A marketing budget shouldn’t be set once and forgotten — reviewing what’s actually working every few months, using real data on where enquiries and revenue are coming from, allows the specific allocation to shift toward what’s genuinely producing return rather than staying fixed to an initial estimate made before any real data existed.

How Outview approaches budget planning with clients

We help clients build realistic, goal-aligned budgets rather than starting from a generic percentage alone — understanding your specific growth target, competitive landscape, and current starting point is core to how we structure any package or custom engagement we propose.

FAQ

Is 10% of revenue always the right marketing budget?
No — it’s a reasonable starting benchmark for an established business focused on steady maintenance, but businesses with aggressive growth goals or new market entry should expect to invest meaningfully more.

Should I cut marketing spend during a slow month?
Generally not advisable — marketing effects have lag, so cutting spend during a slow period often produces an even slower period a few months later, right when it’s hardest to recover from.

How do I know if my marketing budget is being spent well?
Track where actual enquiries and revenue originate, reviewed every few months, and adjust the channel mix toward what’s demonstrably working rather than relying purely on an initial estimate.

What if I can only afford a small marketing budget right now?
Focus a smaller budget on the highest-leverage fundamentals — Google Business Profile, basic local SEO, targeted content — rather than spreading it thinly across many channels at once.

Key Takeaways

7–10% of revenue is a reasonable starting benchmark for steady maintenance; 12–20% suits aggressive growth or new market entry. Business stage and specific goals should shape the exact number more than a fixed industry rule. Marketing spend has lag, meaning cutting it during a slow month often worsens a future period rather than helping the current one. A smaller, consistently invested budget in high-leverage fundamentals beats an inconsistent, unpredictable spending pattern even at a similar total annual cost.

Not sure what a realistic budget looks like for your specific goals? Get in touch for a straightforward, honest conversation about what’s realistic for your business.