Short Answer: Most established businesses should plan to spend 6 to 10 percent of revenue on marketing in 2027, based on benchmarks from Gartner and the U.S. Small Business Administration. Newer businesses building brand awareness typically need 12 to 20 percent, growth-stage businesses land around 10 to 15 percent, and established businesses protecting existing market share can often stay near 6 to 8 percent. The right figure for your business depends on your growth goals, competitive category, and profit margins, adjusted from these ranges rather than picked at random.

Key Takeaways

• Gartner’s 2026 CMO Spend Survey puts average marketing spend at 7.8 percent of revenue, though that sample skews toward companies with over $1 billion in annual revenue.
• The SBA recommends 7 to 8 percent of revenue for businesses under $5 million, assuming healthy net margins in the 10 to 12 percent range.
• Budget needs shift by business stage: 12 to 20 percent for newer businesses, 10 to 15 percent for growth-stage businesses, and 6 to 8 percent for established businesses.
• Cutting marketing spend the moment sales slow down usually deepens the slowdown instead of fixing it.
• A workable split reserves 70 to 80 percent of budget for channels that already work and 20 to 30 percent for testing something new.
• Marketing budgets should be revisited quarterly, not set once a year and forgotten.

If you’ve ever sat down to plan next year’s budget and gotten stuck on the marketing line, you’re not alone. It’s one of the trickiest numbers to nail down. Rent and payroll come with a fixed price tag. Marketing doesn’t work that way. So how much should you spend on marketing in 2027? There’s no single number that fits every business, but there are real benchmarks you can lean on, plus a straightforward process for turning those benchmarks into a number that actually fits your company.

This guide covers what businesses are spending on marketing right now, the factors that should push your number up or down, and a practical approach to marketing budget planning that ties spend to real results instead of a guess.

Why Is It So Hard to Pin Down How Much You Should Spend on Marketing?

Most business owners want a simple rule, something like “spend this percentage of revenue and you’re set.” It’s just not that simple. A law firm competing for personal injury cases in a crowded city has very different needs than a regional HVAC company or a small interior design studio. Your industry, your competition, how fast you want to grow, and how healthy your margins are all pull that number in different directions.

Even so, you need somewhere to start. Figuring out how much should you spend on marketing begins with looking at what similar businesses are actually doing, then adjusting from there based on your own goals.

What Do the Benchmarks Actually Show for 2027?

Two of the most widely used sources for marketing budget benchmarks are Gartner’s annual CMO Spend Survey and the Deloitte and Duke University CMO Survey. They don’t land on the exact same number, but both are useful.

Gartner’s most recent CMO Spend Survey, which polls CMOs and marketing leaders across North America, the UK, and Europe, found that budgets have barely moved, edging up slightly to 7.8 percent of company revenue. Keep in mind that most of the companies in that survey report annual revenue above $1 billion, so it skews toward large enterprises.

For small businesses, the number you’ll hear most often comes from the U.S. Small Business Administration. The SBA’s guidance on getting the most from a marketing budget generally recommends that companies under $5 million in annual revenue put 7 to 8 percent of revenue toward marketing, assuming healthy net margins in the 10 to 12 percent range. If your margins are thinner, a lower percentage will feel more sustainable. If they’re stronger, you may have room to invest more.

In practice, most steady, established businesses land somewhere between 6 and 10 percent of revenue. If you’re in growth mode, entering a new market, or competing in a crowded category like legal services, automotive, or med spa, you’ll often need to push toward the higher end, or beyond it, at least for a while.

What Factors Should Actually Change Your Number?

Benchmarks are a good starting point, but they shouldn’t be the final word. Before you settle on a figure, think through these:

• Your growth goals. Protecting what you already have takes a lot less investment than trying to double revenue in three years. If you’re chasing aggressive growth, expect to spend above the industry average.
• Your industry and competition. Crowded local categories, like personal injury law or cosmetic dentistry, usually need steady visibility across search, paid ads, and content just to stay in the conversation.
• How healthy your pipeline is right now. If leads have slowed down or your website traffic has flattened out, that’s a sign your current spend probably isn’t enough, no matter what a formula says.
• Your profit margins. A business running on thin margins simply can’t commit the same percentage to marketing as one with healthy margins, even at the same size.
• How your budget is split across channels. A budget spread across SEO, paid ads, content, and email will perform differently than one dumped entirely into a single channel, and the mix affects how far your money goes.

How Do You Build a Marketing Budget Planning Process?

Instead of pulling a number out of thin air, walk through this process to build a budget you can actually defend and adjust as the year goes on.

Step 1: Start With Where You Want to Go, Not Just Last Year’s Number

Good marketing budget planning starts with your goals, not with last year’s spend plus a small bump. Decide what revenue you want to hit in 2027, then work backward to figure out how many new customers or clients that requires, and what it typically costs you to land one.

Step 2: Use a Benchmark Range, Then Adjust

Treat 6 to 10 percent of revenue as your starting point, then move it up or down based on the factors above. If you’re aiming for 20 percent growth in a competitive category, plan on sitting closer to the top of that range, or above it, at least in the short term.

Step 3: Decide How Your Budget Splits Across Channels

Once you know your total, decide how much weight each channel should carry before you commit any of it. Most companies do well with a mix that includes search engine optimization for long-term visibility, paid advertising for faster lead flow, content to support both, and email to nurture the contacts you already have. If you’re still working out that split, this overview of full-service digital marketing strategy walks through how these pieces typically fit together for growing businesses. We cover the reasoning behind how that mix should actually play out later in this guide.

Step 4: Leave Room to Test Something New

Even a solid budget should have some flexibility built in for testing. A common approach is putting 70 to 80 percent of your budget toward channels you already know work, and saving the rest for experiments.

Step 5: Decide How You’ll Measure Success Before You Spend

A budget without a way to measure it is just a guess with a dollar amount attached. Before the year starts, pick the numbers you’ll track, whether that’s cost per lead, conversion rate, or return on ad spend, so you can actually tell whether the money is doing its job.

How Does the Right Marketing Budget Change by Business Stage?

The honest answer to how much should you spend on marketing shifts a lot depending on where your business is right now.

Newer businesses usually need to spend more aggressively, often 12 to 20 percent of revenue, simply because they haven’t built up the brand recognition or referral base that older companies rely on.

Growth-stage businesses trying to break into new markets or grow revenue quickly typically land in the 10 to 15 percent range, since they’re actively buying visibility they haven’t earned yet.

Established businesses that are mostly protecting what they already have, and leaning on repeat customers and referrals, can often get by closer to 6 to 8 percent, as long as their current channels are pulling their weight.

If any of those ranges feel high compared to what you’re currently spending, it’s worth taking a closer look at how your current marketing costs break down by channel to see where the gaps really are.

What Mistakes Do Businesses Make When Planning a Marketing Budget?

Even with good benchmarks, businesses tend to make the same few mistakes when planning a marketing budget.

The most common one is cutting marketing the moment sales slow down, which usually makes things worse instead of better. The Small Business Administration actually warns against this. Slower sales followed by a smaller marketing budget can turn into a cycle that’s hard to break, especially if your competitors keep spending through the same period.

Another mistake is treating the budget as fixed once it’s set. Good marketing budget planning is a living process you revisit every quarter, not a once-a-year exercise you forget about until the next budget season. Businesses that regularly check in on the KPIs that reveal whether a marketing budget is working are in a much better position to shift money toward what’s actually paying off.

Finally, a lot of businesses set a number without ever deciding how they’ll measure the return on it. Before you commit to a budget, figure out how you’ll track marketing ROI, so decisions later in the year are based on real data instead of a hunch.

Where Should Your Marketing Budget Actually Go by Channel?

How you split the budget matters just as much as the total number, and the two channels at the center of that split, SEO and paid advertising, work on different timelines that are worth understanding before you fund them. SEO builds value that compounds over time: the rankings you earn keep sending traffic long after the initial work is done. A well-run paid advertising strategy plays a different role, filling the revenue gap while those organic rankings are still catching up, which matters most in the first several months of a new push. Content and email marketing usually round things out, supporting both channels and keeping the contacts you already have engaged.

This is also why the split shouldn’t be locked in at the start of the year. As SEO gains traction, it typically needs less of the budget to hold its position, which frees up room to lean further into paid or content depending on where your pipeline needs help. Checking in on that balance quarterly, alongside the KPI review mentioned above, is what keeps the mix matched to where each channel actually stands.

Frequently Asked Questions

What percentage of revenue should a small business spend on marketing in 2027? Most small businesses under $5 million in revenue should plan for 7 to 8 percent, per SBA guidance, assuming healthy net margins in the 10 to 12 percent range. Businesses with thinner margins may need to stay lower, while those with stronger margins or aggressive growth goals often have room to spend more, sometimes well above 10 percent.

Is 10 percent of revenue a normal marketing budget? Yes, for many growth-stage or newer businesses, 10 percent sits comfortably within the normal range. Established businesses protecting existing market share often spend less, closer to 6 to 8 percent, while newer businesses building awareness from scratch frequently spend more, sometimes 12 to 20 percent.

Should you cut marketing spend when sales slow down? Generally, no. The SBA specifically warns against this pattern, since a smaller marketing budget during a slowdown tends to extend the slump rather than fix it. Competitors who keep spending through the same period often pick up the visibility and leads that a paused budget leaves behind.

How much more should a new business spend on marketing than an established one? Newer businesses typically spend roughly double, 12 to 20 percent of revenue compared to 6 to 8 percent for established businesses. The gap reflects the fact that new businesses haven’t built the brand recognition or referral base that lets older companies spend less and still generate steady leads.

What’s a good split between SEO and paid advertising? There’s no fixed ratio, but a common approach leans on paid advertising for faster results early on while SEO builds momentum, then gradually shifts weight toward SEO as organic rankings mature. Content and email typically support both channels rather than competing with them for budget.

How often should you revisit your marketing budget? Quarterly is the standard recommendation. Cost per lead, channel performance, and competitive pressure all shift throughout the year, so a budget that made sense in January can look outdated by the third quarter if it isn’t checked and adjusted.

Does the 6 to 10 percent benchmark apply to every industry? Not exactly. It’s a reasonable starting point for most steady, established businesses, but crowded or highly competitive categories, such as legal services, automotive, or med spa, often need to spend at the higher end of that range or beyond it just to maintain visibility.

What’s the Bottom Line on Marketing Budget Planning for 2027?

There’s no single correct answer to how much should you spend on marketing, but there is a reliable way to find your number. Start with credible benchmarks, adjust for your industry, your goals, and your margins, then put a measurement plan in place so you actually know whether it’s working. Treat marketing budget planning as an ongoing conversation with your own data, not a decision you make once in January and forget about until December.

If you’re ready to build a 2027 marketing budget that’s based on real strategy instead of guesswork, THAT Agency’s digital marketing team can help you figure out the right investment level and the right channel mix for your business.