Typical marketing budget for a small business in 2025

Introduction

65% of small businesses struggle to generate leads or see significant ROI from their marketing. The reason? They’re not effectively PROMOTING their business.

Most small businesses have a brand identity, a website, and products or services that sell. The initial outlay may have felt manageable when setting up or realigning. But has there been an adequate return on this investment?

Too often, a website is expected to be the silver bullet to sales on tap, leaving business owners frustrated when this doesn’t happen.

Can you relate? 🤔

In this blog, I’ll help you understand the importance of allocating a realistic marketing budget (including the amount) and how to find the right professional support.

THE PROBLEM

Often small businesses have done a bit of this and a bit of that with their online presence and marketing across different providers, creating a disconnected approach.

Whilst web designers play an essential role in creating websites, they’re not necessarily marketers who see the bigger picture.

The result? An attractive-looking website where keywords are an afterthought and content isn’t optimised to perform. This happens because no marketing foundations or strategy were put in place first.

This disconnect leads to tumbleweed… and it often boils down to not managing the business owner’s expectations from the start.

THE SOLUTION

A website isn’t a static tool that sits there. It’s dynamic, just like your business.

You need to feed your website with engaging content that answers questions, handles objections, and shares results. An updated website works behind the scenes, even when you’re not. This is sustainable marketing.

“Your website is a tool, your content is the fuel”

Natalie Alsop

The latest blockbuster

4 COMMON WEBSITE SCENARIOS

Before we look at marketing budgets in detail, let’s explore scenarios that prevent businesses from effectively promoting, whether they have a budget or not. The following are patterns I’ve seen repeatedly in my 20+ years of digital marketing. Can you relate? 🤔

#1 new website

A new website launches without foundations or strategy in place first. It focuses on WHAT the business does, not HOW it benefits the prospect. The business owner isn’t clear on how to communicate, creating a disconnect in messaging and positioning.

This is surprisingly common. The website looks professional and attractive, but the messaging falls flat. Visitors can’t quickly grasp what problem you solve or why they should choose you over a competitor.

Without proper positioning and a clear marketing strategy upfront, the website becomes a digital brochure listing services rather than speaking to the target audience’s pain points and desired outcomes. The result? Low engagement, high bounce rates, and a website that isn’t converting visitors into leads, despite the investment.

#2 ready to scale

A business is ready to scale to a new website platform. This is a significant migration of existing content while retaining the SEO juice and upgrading the design and functionality. Quotes vary widely. It’s tempting to choose the cheaper option when budgets are tight, but it’s crucial to compare like-for-like and understand exactly what’s included.

Too often, businesses experience digital companies that promise the world, charge the earth, then fail to deliver what was agreed.

Hidden costs crop up that weren’t discussed or agreed upon. This breaks down the working relationship, forcing the client to find a new provider. More cost, more time lost, and ultimately confusion, overwhelm and stress.

#3 No handover or training

A website launches successfully but there’s no proper handover or training to enable the business owner to make changes confidently.

Alternatively, clients may have been told they can’t have “administrator” access to the CMS to add new pages and content. Some web designers will put the fear of God into clients, saying they can’t be trusted and will likely mess something up, costing more money to fix.

Other examples: businesses locked out of their sites and held to ransom for changes. Web designers who went AWOL. Worse still, clients who don’t control their domain name, when it isn’t renewed, the domain and website disappear without trace.

#4 Conflicting advice

You’re ready to invest in marketing, but everyone says something different about which channel to focus on. Some push search engine optimisation and content marketing. Others advocate social media marketing or paid ads for lead generation.

I hear this often and get frustrated too, there are many who are good at selling.

The problem? Each channel has pros and cons. Before you decipher who’s right or wrong, understand what you’re trying to achieve and work back from there.

There are many different channels and marketing tactics for businesses; one size doesn’t fit all. Ensure your foundations are in place first and work with professionals who can guide you through the process.

The importance of setting a marketing budget

One of the biggest mistakes small business owners make is assuming that once the initial setup is complete, they can rely solely on word of mouth, organic growth, or free marketing tactics. Whether your total revenue is £50k or £500k, a structured marketing plan makes the difference.

While these methods can bring in some clients, they’re rarely enough to achieve sustainable growth. Your efforts become inconsistent and less effective.

A well-planned marketing budget lets you strategically allocate resources towards activities that drive results—content creation to attract potential customers, digital marketing campaigns to build brand awareness, or search engine optimisation to help your ideal customers find you.

The feast or famine cycle

I know this first-hand; I relied on word of mouth for years. At one extreme, I was so swamped with one client taking up all my time and resources. At another, my jobs had run dry because I hadn’t been networking or building relationships. This feast or famine type scenario is stressful.

When you have a plan of action, your marketing efforts become consistent and effortless. The desolate months don’t add up. Instead, your efforts compound into a steady stream of work. It’s about planting the right seeds consistently.

There is only so much you can do on your own. At some point, you need expert help to fill gaps in the areas you’re not a specialist in. This lets you stay in your lane, focusing on your expertise while knowing your marketing is being done correctly.

It’s like an accountant handling your end-of-year accounts—giving you peace of mind they’re done right.

Where should your marketing budget go?

This is understandably tricky when developing your marketing strategy. With so many different opinions and marketing channels available: content marketing (blog posts, social media posts, email newsletters), social media marketing, search marketing. How do you choose?

The only way to be sure is to consider your target market and business goals, then test.

Marketing is all about testing. Set clear measurable goals, track the results, and see what’s working. Working with professionals who can guide you through the process and explain things in plain English helps you understand. Allow 6-12 months to start seeing patterns.

Quick Budget Allocation Guide:

• Calculate 5-10% of annual revenue
• Prioritise based on business stage
• Test and measure for 6-12 months
• Track success metrics monthly
• Adjust based on results

What is the average marketing budget for a small business?

According to BDC, a B2B company should spend between 2% – 5% of its gross revenue on marketing. For B2C companies, the proportion is often higher, between 5% – 10% to reach various audiences.

However, there’s no one-size-fits-all answer. It depends on your business stage, the goals you’re trying to achieve, your industry, and how competitive it is.

Here are some examples:

• Turnover: If your annual revenue is £100,000, a 7% marketing budget means investing £7,000 in marketing activities over the year.
• New businesses or startups in highly competitive markets may need to spend closer to 10% (or more) to build brand awareness and gain market share.
• Established businesses with strong brand recognition might get away with spending less.

These figures may not feel realistic, especially if you haven’t been budgeting for marketing spend. But remember, a budget should be seen as an investment, not an expense.

You need to start somewhere…

But I can’t afford that…

Small businesses have ongoing costs. Setting aside a marketing budget can feel daunting, especially when you’re time-rich but cash-poor. So you try doing the marketing yourself, which takes ages and doesn’t always yield results.

You’re juggling multiple responsibilities, growing your business with limited resources while managing other marketing expenses. But if you want to attract leads and clients consistently, investing in marketing isn’t optional, it’s essential.

The real issue isn’t affordability. It’s not seeing the importance of finding a marketing model that works and investing in it, along with the right professional support.

The real cost of not investing

The age-old adage holds true: speculate to accumulate. To build a thriving business, you must invest in the right marketing strategies and support.

By understanding your business’s unique needs and working with a professional marketer, you ensure every pound spent on marketing works hard to bring in leads and build your business.

What to Look for in a Professional Marketer

Whether you’re working with a freelance marketer or a marketing agency, choosing the right partner is essential. Here’s what to consider:

• Experience + expertise:
  Look for a marketer with experience working with businesses like yours. They should understand your industry’s unique challenges and opportunities.
  
• Proven results + happy clients:
  Ask for case studies or testimonials. A good marketer has a track record of delivering measurable results—increased website traffic, higher conversion rates, or more qualified leads. They should show you how they’ve helped businesses improve search results, generate qualified leads, and reach their target market effectively.
  
• Strategic thinking:
  A professional marketer should develop a customised strategy that aligns with your business goals and marketing goals.
  
• Transparency + communication:
  Choose a marketer who’s clear about pricing, processes, and expected outcomes. They should keep you informed throughout the campaign with regular progress updates.
  
• Connection + compatibility:
  Ensure the marketer’s values, work style, and personality align with yours. A good working relationship is key to successful partnership.

FAQs

Why can’t I do it myself?

You absolutely can. But consider this: do you have the right tools, knowledge and patience to figure it all out? Or would it not be better to work with professionals who can do it quickly and efficiently? Perhaps a blend where they handle the technical stuff while you do tasks within your comfort zone.

What is the 70/20/10 rule for marketing budget?

The 70/20/10 rule suggests allocating 70% of your marketing budget to proven tactics that consistently deliver results, 20% to emerging strategies you’re testing, and 10% to experimental approaches. This balanced approach maintains stability while exploring new opportunities. For small businesses, this might mean spending 70% on core content marketing and SEO that’s working, 20% testing new social media platforms or ad campaigns, and 10% trying something fresh like video marketing or partnerships.

What is a realistic marketing budget for a startup vs an established small business?

Startups typically need to invest 10-20% of projected revenue to build initial brand awareness and gain market traction. Established small businesses can often reduce this to 5-10% of annual revenue for maintenance and growth. The key difference? Startups are building everything from scratch: audience, recognition, trust. While established businesses already have assets working for them.

How long before I see results from my marketing budget?

Allow 6-12 months to see meaningful patterns and results. Some tactics like paid advertising generate quick wins within weeks, but sustainable channels like content marketing and SEO typically take 3-6 months to gain momentum. Consistency matters. Stopping too early means you never reach the compound effect where your efforts really pay off.

What should be included in my marketing budget?

Your marketing budget should cover essential marketing costs: website hosting and maintenance, content creation (blog posts, social media, email newsletters), paid advertising if relevant, marketing tools and software, professional services (copywriting, design, SEO), and analytics/tracking tools. Budget for testing because not everything works first time, and you need room to experiment and adjust.

How do I track if my marketing budget is working?

Set clear success metrics (measurable goals) before you start spending: website traffic growth, lead generation numbers, conversion rates, cost per lead, and ultimately revenue generated. Track these monthly and compare against your targets. If something isn’t working after 3-6 months of consistent effort, reallocate that budget to channels showing better results.

CONCLUSION

Speculate to Accumulate

Let’s address the elephant in the room: you need to invest in your business…

A properly allocated small business marketing budget drives growth, increases revenue, and delivers the best return on investment while positively impacting your bottom line.

I meet many small businesses with a brand identity, website, and service that sells. Yet despite this initial investment, they haven’t seen a return on their marketing efforts. Investing in marketing might seem risky when resources are tight, but it’s a risk worth taking. By allocating a marketing budget and seeking professional support, you position your business for long-term success:

• For startups: A well-defined marketing budget helps you gain traction in a competitive market and build a strong foundation for growth.
• For small businesses: It ensures sustained growth and effective competition with larger companies. 

Remember, a strategic marketing investment can help you attract more clients, build a strong brand, and achieve the growth you’ve been striving for more quickly.

Martin Scorcese’s latest blockbuster would absolutely have a separate budget for promotion, and so should your business…

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