Marketing is an important part of any business plan, but how much do companies really spend on it? This question is important for all businesses, whether they are new or large global companies. Knowing how to manage marketing budgets helps businesses use their resources well, stay competitive, and get the most value from their investments. In this piece, we will look at how much companies spend on marketing, trends in different industries, and what affects these budgets. This guide will give helpful information for business owners, marketers, and anyone who is interested.
1. What is a Marketing Budget?
A marketing budget is a plan that shows how much money a company will spend on marketing over a set time, usually a year. It covers costs such as ads, making content, social media campaigns, events, and paying employees. A well-planned marketing budget ensures that every dollar spent adds to achieving business goals, such as increasing brand awareness, generating leads, or driving sales.
2. Average Marketing Spending: Important Numbers
How much do businesses spend on marketing? Companies typically spend between 9.1% and 13.6% of their total income on marketing. However, this percentage varies significantly based on the industry, company size, and growth stage.
- B2B companies usually spend 2-7% of their income on marketing.
- B2C companies spend 5-12% of their earnings on marketing.
- Startups and fast-growing companies may spend 20-30% of their earnings to quickly enter the market and increase brand awareness.
3. Marketing Expenses by Industry
How much do companies in various businesses spend on marketing? Let’s simplify it:
- Tech and Software
The tech industry spends the most on digital marketing, with companies using 11-30% of their earnings for marketing. Startups in this sector often spend more to build a strong market presence.
- Stores and Online Shopping
Retail and online companies usually spend 5-12% of their income on marketing, mainly using digital methods such as social media, search engine optimization (SEO), and partnerships with influencers.
- Healthcare and Pharmaceuticals
Healthcare businesses spend 2-6% of their income on marketing. Digital health startups might spend as much as 10% to connect with people online.
- Money Services
Financial services companies usually spend 4-8% of their income on marketing. Fintech startups often spend even more, between 10-20%, to grow quickly.
- Manufacturing and Industry
These industries spend 5-7.5% of their income on marketing, mainly using B2B methods like trade shows and webinars.
4. Things That Affect Marketing Budgets
How much do businesses spend on marketing? It relies on a few things:
- Money the company makes.
Bigger companies with more money usually spend a smaller portion of their income on marketing than starts and small businesses do.
- Competition in the Market
In competitive industries like shopping and technology, companies often spend a lot on marketing to gain more customers.
- Growth Stage
Startups and fast-growing companies spend a lot on marketing to increase brand recognition, while established companies work to keep their market share.
- Ways to Reach Customers
The decision between digital and traditional marketing platforms affects budgets. Digital marketing makes up 56% of all marketing spending because it is affordable and shows clear results.
5. Spending on Digital vs. Traditional Marketing
How much do companies spend on digital marketing compared to standard marketing?
Digital marketing makes up 56% of total marketing spending, with social media, SEO, and paid search as the main focuses.
Traditional marketing is still important and makes up 44% of budgets, but its proportion is going down because more people are using digital channels.
6. New Trends in Marketing Expenses
How much do businesses spend on marketing in new markets?
- Artificial Intelligence and Automation: More companies are spending in AI and automation tools to make their marketing processes faster and more efficient. By 2025, 90% of brands will have budgets committed to AI marketing technology.
- Sustainability and Ethics: Consumers want more sustainable and ethical practices, leading businesses to spend some of their marketing money to promote these efforts.
- Videos and Social Media: Video marketing is very important, with 91% of companies using videos to promote themselves. Social media platforms like TikTok and Instagram are also seeing greater investment.
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7. How to Decide on Your Marketing Budget
How much should your business spend on marketing? Please follow these steps:
- Set Your Goals: Do you want to get more people to know your brand, find potential customers, or boost sales? Your goals will decide how you spend your cash.
- Look up industry standards.: Compare your budget to industry averages to ensure you’re paying enough to stay competitive.
- Review Your Marketing Channels: Figure out which channels like social media, email, or SEO work best for your business, and then budget your money for those channels.
- Monitor and Change: Regularly check how your marketing is performing and change your budget to get the best return on investment.
8. Conclusion: How Much Do Companies Spend on Marketing?
How much do businesses spend on marketing? The answer can be very different based on the business, the size of the company, and how far along the company is in its growth. Most businesses spend between 9.1% and 13.6% of their revenue on marketing, with a focus on digital channels. By knowing these trends and factors, businesses can make smarter choices about their marketing budgets and reach their goals.
No matter if you’re a new business or a well-known company, putting money into marketing is important for growth and success. How much will your business spend on marketing in 2025?
This piece will help you learn how much companies spend on marketing and how to make the most of your own budget. If you found this guide useful, please share it on LinkedIn or your website to help others with their marketing choices.
