6 Steps To Determine A Small Business Marketing Budget

Our Process For Determining A Market Budget Is Proven & Backed By Stats 

Most small business owners know the importance of digital marketing. However, many often have trouble getting off the runway due to a variety of reasons. Such reasons include a lack of product knowledge or failing to define attainable goals. Therefore, business owners who lack these understandings do not start running campaigns or abruptly stop marketing online. As you may know, digital marketing focuses on sustainable, long-term growth rather than short-term results. Therefore, you need to give your efforts time in order to produce results. Nevertheless, another reason many business owners do not start marketing online is that they never answer the question, “How much should I budget to market my small business?”.

Determining a marketing budget for a small business

The rest of this article will give you the guidelines necessary to answer this question. However, I’ll tell you right now. Figuring out how much your small business should budget for marketing is easier than you’d think.

1. Understand the business that you’re in

The first step to determining a marketing budget is to understand the business that you’re in. By doing so, you can select the marketing products that you require in order to see results. Questions include:

  • What products/services do you offer?
  • What kind of marketing have you been doing so far, if any?
  • If you haven’t been marketing your products, how could you see your products or services being marketed successfully?
  • What is your industry’s landscape like?
  • What do your competitors do for marketing?
  • Have they been successful?

Once you have reflected on your business, you will be able to define more specific (and attainable) goals at the end of the process. In addition, you will better understand how much advertisement will cost. Typically, an advertisement’s cost is in alignment with the potential value you stand to gain from a new customer.

2. Understand your customers

After you have an understanding of the competitive landscape of your business, you need to reflect on your customers. Questions to ask yourself include:

  • What are my customers like?
  • Where do my customers like to receive communication?
  • How would they react to a certain form of marketing from my business?

3. Outline your goals

With a better understanding of your customers, you can now outline your goals. Questions to ask yourself include:

  • Which channels do I want to implement?
  • To what extent, do I want to influence a purchasing decision through a certain channel?
  • Do I want to generate traffic to my website?
  • Based on how many customers I have per month right now, how many customers do I want?

4. Use marketing budget industry benchmarks

According to the U.S. Small Business Association, the benchmark for a small business marketing budget is 7-8% of gross revenue. While this is only a benchmark, you can use this range to determine a lower end and higher end target budget. For your lower-end target budget, multiply your monthly average revenue by 7%. For your higher-end target budget, multiply your monthly average revenue by 8%. This will give you a base understanding of the marketing budgets of small businesses.

5. Reconcile with your needs

Benchmarks are helpful in that they give us a point of reference when making decisions. However, budgets are subjective to the needs of the business owner. Depending on your industry, current brand awareness, and business’ goals, you’ll need to reconcile your needs with a budget that works for you. In fact, marketing budgets greatly vary between industries (WSJ).

Based on your needs and costs, we recommend that you determine a base percentage of your monthly average revenue that you allocate to marketing. Since your needs are specific to your business, use the ‘target’ range calculated in the previous step as a reference.

6. Repeat as your business’ needs change

Although it is good to have a base percent of your revenue that you allocate to marketing efforts, your needs will change. As a result, your goals should change as well. For example, you will have different needs if you are starting a business than if you are already established and generate substantial revenue. As for the business starter, you will need to build a website and generate awareness of your products and services with paid search and social advertising. If you are an established business owner, then you will need to turn the value of your existing customers with SMS marketing and extend your reach with offer ads on social platforms or paid search ads.

As you can see, your needs will evolve as your business progresses. Your marketing budget should evolve as well. Therefore, you should continually repeat the steps outlined in this article and ask yourself the questions listed in each step so that you define a marketing budget that fits your changing needs.

We Tailor Our Services To The Budget & Needs Of Our Clients

TAPLocal is a full-service agency that provides a wide range of digital marketing products for new and established SMB owners alike. Once you have defined your marketing budget, visit our homepage or give us a call at 888 882 7996 to schedule your free online marketing consultation.

Share This Article!

Share on facebook
Share on linkedin
Share on twitter
Share on email

Our Partner Network

  • 123local
  • 2findlocal
  • 8coupons
  • ABLocal
  • AllergyEats
  • AllMenus
  • AmericanTowns
  • AroundMe
  • Baidu
  • Banks.com
  • Brownbook.net
  • Central Index
  • ChamberofCommerce.com
  • CitySquares
  • CK Maps
  • Cylex
  • DexKnows
  • DoorDash
  • Dun & Bradstreet
  • eLocal
  • EZlocal
  • Find Open
  • Fliggy
  • GoLocal247
  • HERE
  • HolidayCheck
  • HostMe
  • HotFrog
  • iBegin
  • iGlobal
  • Insider Pages
  • Instagram
  • Local.com
  • LocalDatabase
  • LocalPages
  • LocalStack
  • Mafengwo
  • Mapstr
  • Menupix
  • MerchantCircle
  • My Local Services
  • n49
  • Navmii
  • NDrive
  • Opendi
  • OpenTable
  • Parent Day Out
  • Pitney Bowes
  • Pointcom
  • Postmates
  • Property Capsule
  • RetirementPlanning.net
  • SafeGraph
  • ShowMeLocal
  • Soleo
  • Superpages
  • tellows
  • TomTom
  • Top Rated Local
  • Trip.com
  • TripAdvisor
  • TrustPilot
  • Tupalo
  • Uber
  • Uber Eats
  • USCity.net
  • VotefortheBest
  • Waze
  • Where To?
  • WiserAdvisor
  • Yalwa
  • Yandex
  • YaSabe
  • YellowMoxie
  • YellowPageCity
  • YellowPagesDirectory
small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Read A Client Success Story

Learn How To Leverage The Power of Facebook for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Offer Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Lead Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Awareness Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Click Ads To Grow Your Business

Read A Client Success Story!

Learn How We Increased Our Client's Online Visibility & Got Him More Leads!

Get Your Web Design eBook!

Learn What Separates A Winning Website From The Losing Ones

Get Your Free SMS Marketing eBook!

Learn How To Turn New Purchases Into Your Most Loyal Customers

Get Your Reputation Management eBook!

Learn How To Build Your Online Reputation & Get More Paying Customers

Get Your Free Ebook Today

Learn How To Audit Your Merchant Statement And Cut Your Costs

Get Your Google Ads eBook!

Learn How To Convert Web Traffic Into Revenue

Get Your Facebook Ads eBook Today!

Learn How To Advertise On The World’s Biggest Stage

Can Google's Crawlers Understand Your Site?

Find Out If Your Website Has Schema Markup

Schema Markup - Contact Info
small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Payments Consultation Awaits

Read A Client Success Story!

Learn How We Helped Our Client Build Their Online Reputation & Get More Customers As A Result!

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Payments Consultation Awaits

Let's Create Your Free Account

Claim Your Free Clover Today!

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Read A Client Success Story!

Learn How To Leverage Google Ads For Business Growth

Read A Client Success Story!

Learn How To Leverage The Power of Text Message Marketing For Your Business!

Want To See How You Show Up?

Tell Us Where To Send Your Report!

Run Your Free Business Report - Contact Info
Pop-up form preceding Yext Scan CTA, basic contact info

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Professional

Pick A Time To Speak With A Local Business Expert

Place Your Vision Online With Award-Winning Web Design!

Web Design - Scheduling

Set Up Your Free Account In Minutes

Make It Easier For Your Customers To Pay You!

Payments - Get Started

Set Up Your Free Account In A Matter Of Minutes

Customize Your Clover To Work The Way You Do!

Clover POS - Get Started

Pick A Time To Speak With A Local Business Expert

Get More Positive Reviews With TAPLocal Review Management!

Review Generation - Scheduling

Pick A Time To Speak With A Local Business Expert

Get A Full Tour Of Our Business Manager Dashboard!

Dashboard Demo - Scheduling

Our Packages Are Built With All Your Needs In Mind

Find Out Which Package Your Business Qualifies For!

Free Clover - Pricing

Clover POS Is The Perfect Business Companion

Find Out Which Device Is Best For Your Unique Needs!

Free Clover - Meet Clover

Pick A Time To Speak With Local Business Specialist

Claim Your Free Clover Today!

Free Clover Package - Scheduling

Create Your Free Account & Pick Your Package

Claim Your Free Clover Today!

Free Clover Package - Get Started

Want To See How You Show Up?

Tell Us About Your Business

Let's Get Started

Start Rewarding Your Customers Today!

Clover App Market - Restaurant Rewards
Pop-up form on Restaurant Rewards page

Pick A Time To Speak With A Local Business Expert

Boost Your Business With An All In One Package!

All In One Packages - Scheduling
Pop-up form preceding All In One Packages scheduling

You Could Be Saving Thousands Of Dollars A Year

See How TAPLocal Stacks Up To The Competition

Payments - Competitor Pricing
Pop-up form preceding Yext Scan CTA, basic contact info

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Ultimate

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Standard

Read A Client Success Story!

Learn How We Grew Our Client's Business With Stellar Web Design

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Builder

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Starter

Pick A Time To Speak With A Local Business Expert

Start Gaining Repeat Business From Your Customers Today!

Text Message Marketing - Scheduling

Pick A Time To Speak With A Local Business Expert

Take Control Of How You Show Up Online Today!

Listings - Scheduling

Pick A Time To Speak With A Local Business Expert

Starting Driving Hyper-Local Traffic To Your Website!

Listings - Scheduling

Pick A Time To Speak With A Local Business Expert

Boost Your Facebook Ads With Hyper-Local Technology!

Facebook & Instagram - Scheduling

Pick A Time To Speak With A Local Business Expert

Get Prime Exposure With Our Reach & Frequency Guarantee!

Facebook Awareness Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Advertise On The World's Leading Search Engine!

Facebook Awareness Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Find Out How TAPLocal Can Grow Your Business!

TAPLocal Appointment - Scheduling

Pick A Time To Speak With A Local Business Expert

Get HOT Local Leads Delivered Directly To Your Phone!

Facebook Lead Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Help Hungry Customers Find You When They Need To!

Listings For Food - Scheduling

Pick A Time To Speak With A Local Business Expert

Drive Sales With Redeemable Offers On Facebook!

Facebook Offer Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Simplify How Your Customers Pay You & Cut Processing Costs!

Payments - Scheduling

Pick A Time To Speak With A Local Business Expert

Simplify Your Day-To-Day With The Perfect Point Of Sale!

Clover POS - Scheduling

Get Your Business Listings eBook!

Learn How To Get Found By Consumers Who Are Searching For A Product Or Service That You Offer