“How much should I spend on marketing?” is one of the hardest questions for small business owners. Spend too little and potential customers never hear about you. Spend too much — or in the wrong places — and you burn money you cannot afford to lose.
There is no perfect number, but there are sensible ways to decide. Here is a practical approach.
Common rules of thumb
You will often see guidance suggesting small businesses spend somewhere in the region of 5–10% of revenue on marketing, with higher percentages for new businesses or those in growth mode. Businesses launching a new product or entering a new market may temporarily spend more.
These figures are a starting point, not a rule. The right budget depends on your:
- Stage: new businesses typically need to invest more to build awareness.
- Margins: high-margin services can usually support higher marketing spend.
- Growth goals: aggressive growth requires more investment.
- Competition: crowded markets cost more to stand out in.
- Customer value: if each customer is worth thousands over their lifetime, you can afford to spend more to win one.
A better approach: work backwards from your goals
Instead of picking a percentage, start with what you want to achieve.
- Set a goal: for example, 10 new clients per month.
- Know your conversion rate: if one in four enquiries becomes a client, you need 40 enquiries.
- Estimate cost per enquiry: if past campaigns cost around €20 per enquiry, 40 enquiries cost about €800.
- Check the economics: if a new client is worth €1,500 in profit over time, €80 to acquire each one is excellent value.
If you do not yet know these numbers, start small, track carefully and build the picture over a few months. Our guide to measuring marketing ROI explains what to track.
Do not forget your time
Marketing costs are not just money. If you spend ten hours a week on social media, that time has a value. Sometimes paying a professional is cheaper than doing it yourself once you factor in your hourly rate and the opportunity cost. We discuss this in DIY, freelancer or agency?
Where should the money go?
A balanced small business marketing budget often covers:
Foundations (one-off or occasional)
- A professional website (see how much a website costs).
- Branding and logo (see building a brand on a budget).
- Photography and video.
Always-on activity (monthly)
- Social media management.
- Content creation and blogging.
- Email marketing.
- Local SEO and Google Business Profile management.
- Website hosting and maintenance.
Paid promotion (flexible)
- Meta ads (see Meta ads on a small budget).
- Google Ads.
- Local sponsorships, events and print advertising where relevant.
Prioritise the foundations
If your budget is limited, invest first in the things that make everything else work: a clear, professional website, an optimised Google Business Profile and a process for collecting reviews. Sending paid traffic to a weak website wastes money.
Adjust for seasonality
Businesses on the Costa Blanca and Costa Cálida often see strong seasonal swings. Increase spend before and during peak booking periods, and shift towards lower-cost, relationship-focused activity in quieter months. See planning social media around the Costa season.
Review regularly
Treat your marketing budget as a living document. Review results monthly, cut what does not work, invest more in what does and test one new idea each quarter.
Get more for your budget
Because we run lean without big-city overheads, we can offer agency-level marketing at prices that make sense for small businesses. No long contracts, no hidden fees — just agreed hours and measurable results. Get in touch and we will help you plan a budget that fits your goals.
