Ask how much a small business should spend on marketing, and the answer usually comes back as a percentage of revenue. Those published ranges are worth knowing, because they make good guardrails. The real number, though, comes from your goal, and from whether putting more into marketing right now is the best move for your business, since no two years are the same. What the first dollars buy, and in what order, shapes more of the year than the percent does, because ads multiply whatever they land on.
What the published numbers say
The Business Development Bank of Canada publishes a range of 2 to 5 percent of revenue if you sell to other businesses, and 5 to 10 if you sell to consumers. It's a good barometer, and it's the clearest range a real institution puts its name on.
The figure repeated most often says the SBA recommends 7 to 8 percent of revenue, but that recommendation doesn't appear anywhere on the SBA's own site. In a 2019 post on its own blog, the SBA says there's no hard rule. What that post does cite is two survey averages: a little over 1 percent of revenue on advertising, and 7.9 percent on marketing as a whole. So the recommendation everyone repeats is folklore, while those averages are real.
The high end belongs to the CMO Survey, whose 2026 edition found companies putting about 9 percent of revenue into marketing on average, and companies under $10 million in sales reporting about 13. Before leaning on that, it helps to know who answers the survey. Its respondents are companies with a senior marketing leader on staff, and the smallest-company figure rests on twenty answers with a very wide spread. An owner-run business with no marketing team almost certainly sits lower.
Seen in dollars, those guardrails are wide. For a business doing $2 million a year, the 2 to 5 percent band runs from $40,000 to $100,000, roughly $3,300 to $8,300 a month, and at $5 million it runs about $8,300 to $21,000 a month. That's arithmetic on the published ranges, not a recommendation. Where a business should sit inside them, or above them for a while, depends on its goal and on whether more marketing is the right move for it at that moment.
Those numbers need a reader, and ours is specific: an established, independently owned business, maybe with a few locations or a storefront online, and nobody in-house whose whole job is marketing. Because that's who we work with, it's who we write for. Most of what's published answers for "a small business" in the abstract, a category wide enough to hold a food truck and a forty-person firm. That's how the same percent ends up handed to businesses with nothing else in common.
What the money buys
Whoever spends it, a marketing budget splits three ways, and the foundation comes first. It runs in order, like a waterfall, starting with the brand and the message: who the business is, what it says about itself, and the identity and design that carry both. After the brand comes the website or online store, built on that brand to be fast on a phone and easy to act on, so asking, booking or buying takes a minute. It's also set up to be found on Google and in AI answers, without paying for every click.
Everything else flows from those two. The Google listings get claimed, kept consistent and answered so they match the site, because the listing is usually the first thing a local customer sees. In step with them, the social accounts take on the brand's look and voice, and the counting goes in before the first ad dollar does, so every inquiry, call and sale lands somewhere you can see it. In that order, the foundation is mostly built once and then kept up, and it takes the first dollars because everything after it either stands on it or falls through it.
Next comes the running work. That means paid ads on Google and Meta, to reach new customers or remind others to purchase again. Alongside them sit the posts that keep the business visible and a regular reading of what the money did, in numbers you can check yourself. This is the layer most people picture when they picture marketing, and it's also the layer that quietly fails when the foundation under it is missing. When it fails, the cost shows up in money: ad clicks landing on a site that loses them, searchers finding the wrong hours, and results nobody can prove.
Scaling comes last and is the simplest of the three, because it's just more money into the ads the counting proves are paying. Inside the budget, some of the money pays for the work itself and the rest goes straight to the ad platforms as media. Foundation months lean toward the first and scaling months toward the second, and owners sometimes read the first part as overhead, when it's what decides whether the media comes back.
Our case studies are the receipts for all three levels. The full rebuild shows a business where the brand, website, listings and counting came first and the ads came after. At the smaller end sits a brand and website rebuilt for a business parents have to trust before they ever call, with ads following to bring those families in. The online store sells nationwide, and we advertise nationwide for them. Each page carries the numbers.
Sequence beats percent
Two businesses can commit the same percent and have opposite years. For that reason, we run the order the same way for every client: brand before ads, organic social before paid, and the counting proven before a dollar of ad spend. Ads are multipliers. Send more people to a website that loses them, and you've bought more lost people, while listings that contradict the site just let more searches find the contradiction faster. Where nothing is counted, the ads that work and the duds look identical in the report, so the good ones get switched off right beside them.
Run in that order, the foundation goes live before the ads start. When the ads do begin, they land on a site built to take an inquiry, with counting in place to show what they bring in, and that's the only kind of ad spend we'd ask an owner to fund.
If you've already spent, and you're holding a report full of clicks with no sales you can point to, we've written that diagnosis on its own: why your marketing isn't working. This piece is for the dollars you haven't committed yet.
How to set your marketing budget
Start with the goal. Decide what you want marketing to do for your business, and put a number on it.
Then choose a budget that can reach that goal. Use the published ranges as guardrails, not a formula. Not every year is the same, and some years call for putting more into marketing than others.
Spend it in this order:
- Fix the foundation first: a website people can act on, Google listings that are right, and a way to count every inquiry, call and sale.
- Then run ads, and only ads whose results you can count.
- If you can't count the results yet, hold the ad money until you can.
If you'd rather hand the whole budget to one partner who spends it in this order and shows you what it did, that's what VBO does. We work with large and small businesses, as big as Sir Galloway and as small as The Fudge Pie Co. Our case studies show it end to end: what each business needed, what we built, and what changed. Tell us the goal, and we'll start from there. We're at hello@vboadv.com.
Sources
- Business Development Bank of Canada (BDC), "Marketing your business: essential read for entrepreneurs" and "Grow your marketing budget to boost sales"
- U.S. Small Business Administration, "How to Get the Most From Your Marketing Budget" (SBA blog, 2019)
- The CMO Survey, Firm and Industry Breakout Report, 35th edition (2026)