Is there a standard percentage?
There is no rule, but a commonly quoted range is 5% to 10% of revenue. New businesses, crowded categories, and businesses trying to grow fast tend to spend more. Established businesses with lots of repeat customers can spend less.
Example: a business doing $300,000 a year would budget about $15,000 to $30,000, or roughly $1,250 to $2,500 a month.
What should I spend on first?
- The free and nearly free basics: Google Business Profile, review requests, and directory listings.
- A website that works on a phone and makes it easy to call or book.
- Consistent social posts, and email to the customers you already have.
- Paid ads, once the basics are turning visitors into customers.
Where does the money actually go?
- Your time. It is a cost too, and often the biggest one.
- Tools: website hosting, email software, booking software.
- Help: a freelancer, an agency, or a studio.
- Ads: Google, Meta, or Local Services Ads.
How do I know if it is working?
Track your cost per new customer: what you spent in a month divided by the new customers it brought in. Ask every new customer how they found you, and check the calls, website clicks, and direction requests in your Google profile each month.
Should a College Station business spend the same every month?
No. Spend more around August move-in, football season, and graduation weekends, and less during the summer slowdown, when email to existing customers does most of the work. See game day marketing.
Common questions
Is 10% of revenue too much to spend on marketing?
Not for a new business or one trying to grow, as long as you can measure what it brings in. If you cannot measure it yet, start smaller and build up.
Should I count my own time as a marketing cost?
Yes. Ten hours a month on social media has a real cost even if no invoice arrives. It is often the most expensive part.
Does a small business need paid ads?
Not at first. Many local businesses get most customers from Google Maps, reviews, and word of mouth. Ads help when you want growth faster than those can give.