How much should you actually spend on marketing?

Two serious surveys measure this every year. The Gartner CMO Spend Survey put marketing budgets at 7.7% of company revenue in both 2024 and 2025, down from an average around 11% in the years before the pandemic. The CMO Survey, run by Deloitte, Duke University and the American Marketing Association, measured 9.4% of revenue in 2025, and found the smallest companies in the sample report the highest shares.

Two honest caveats. Gartner surveys mostly very large companies, so treat 7.7% as a floor for context, not a small-business prescription. And the famous claim that "the SBA recommends 7 to 8%" is quoted on hundreds of websites, but the US Small Business Administration's current site does not actually say it. We checked. So this page leans on the two surveys you can verify, and labels everything else as the rule of thumb it is.

For an established NZ small business that wants to grow, a working band of 6 to 10% of revenue sits right on top of both benchmarks. New businesses and aggressive growth push it higher, which the next section explains.

Most small businesses set their marketing budget the same way: whatever is left over, whenever someone remembers. That produces the classic pattern of spending in bursts when things are quiet and cutting to zero when things are busy, which is exactly backwards. The quiet spell you are marketing your way out of was caused by the spending you cut three months ago.

A percentage of revenue fixes that in one move. It scales with the business, it survives a busy month, and it forces the one conversation that matters: is this line item an expense or the thing that generates next quarter's revenue? Pick the percentage once a year, review it once a year, and stop re-litigating it every time an invoice arrives.

Age changes the number. An established business has reviews, repeat customers and word of mouth doing free marketing every day. A new business has none of that, so every single enquiry has to be bought or earned from a standing start. The widely used rule of thumb is 12 to 20% of revenue for a business in its first couple of years, easing back as the compounding kicks in. That is a rule of thumb, not a survey figure, and the calculator flags it as one.

Where the money goes matters more than how much there is. The order for a local NZ business is not controversial, it is just widely ignored: website, Google Business Profile, reviews, then ads, then content.

• Website first. Every dollar you spend anywhere else eventually sends someone here. If the site is slow, dated, or vague about what you do and where, the rest of the budget leaks through it.
• Google Business Profile second. For local searches it is often seen before your website is. Complete it fully: categories, photos, hours, services, and posts.
• Reviews third. A steady drip of recent reviews beats a wall of old ones. Build asking for them into how you finish every job.
• Ads fourth. Paid traffic is a multiplier, not a fix. It multiplies a good foundation into enquiries and a weak one into nothing, at full price either way.
• Content last. Genuinely useful pages compound for years, but they are the slowest to pay off, so they come after the machine works.

This is why the calculator's blunt line exists. Ads pointed at a weak website burn money. If you are not sure which side of that line your site is on, the free grader on our homepage will tell you in about a minute.

Dollar figures for services vary too much between providers and regions to quote honestly, so here is the shape of it instead. At around $500 a month you are choosing one thing and doing it properly, and you are trading your own time for the rest. That usually means keeping the foundation sharp: the site maintained and improving, the Google Business Profile active, reviews coming in, and perhaps a small, tightly targeted ad experiment. It does not stretch to doing everything at once, and pretending it does is how budgets evaporate.

At around $2,000 a month you stop doing one thing and start running a system: foundation maintained, ads running continuously with someone actually managing them, and content being produced instead of planned. The trade-off flips from money to attention. The risk at this level is not waste through smallness but waste through inattention, paying for activity nobody measures.

Either way the same rule holds: spend at a level you can sustain for at least six months. Marketing compounds, and a budget that lasts two months buys you the expensive part of the curve and none of the payoff.

There are weeks when the right marketing budget for ads is zero. If your website loads slowly, looks ten years old, or does not clearly say what you do, who for, and where, fix that first. If your Google Business Profile is unclaimed or half empty, fix that first, it is free. If your last review is from two years ago, fix that first, it is also free. Paid traffic aimed at any of those problems is the most expensive way to discover them.

The tell is in your numbers. If people visit and do not enquire, more visitors will not save you, and buying them just scales the leak. We wrote a plain read on why a site gets traffic but no enquiries if that pattern sounds familiar. Fix the conversion problem, then turn the ads on, and the same budget suddenly works twice as hard.