The Creativ Brief: Marketing Spend Best Practices
A good rule of thumb across industries is allocating a fixed percentage of company revenue to marketing. The percentage you select will vary depending on business objectives and strategies.
Fixed percentage marketing investments allow you to scale spend consistently as your company grows. Your absolute marketing spend will increase as your revenue increases and conversely shrink if revenues fall.
A Gartner study surveying 400+ CMOs looked at marketing spends across consumer industries. These spends ranged from 5-11% of total gross revenue, with financial services, travel, and hospitality occupying the higher end of that range.
For business to business, a study from BDC bank surveying over 1,400 B2B businesses found the range to be 2-5% of total gross revenue.
Pre-revenue startups with an MVP can attribute a certain percentage of funds raised to marketing and then scale marketing in line with revenue growth as the firm gains market traction.