3 Reasons To Have A Marketing Budget

by | Feb 14, 2022 | Business Building Musts, Marketing Strategies, Sales, Small Business Help

Today we are talking marketing budgets – because frankly we need to.

Many, many, many small business owners I talk to either:

  • Don’t have a marketing budget, or
  • Don’t know what that budget really is.

I was always taught in business that your marketing budget should be around 10% of your revenue – and this is regardless of the industry.

Basically that translates that if you make $100,000 a year, you should be spending around $10,000 on marketing.

AND – if you are setting up a new business – your marketing budget might even be more to try and establish yourself in the marketplace.

Now grab a notebook and work this out for your business:

  • How much revenue do you make in a year?
  • How much do you spend on marketing in a year?

Now, I’ll put a small caveat here – did you just write down that you spend $0 on marketing but you have business social media and it’s “free”.

Your business Social Media is NOT really free – you are simply trading time for money.

And what do I mean by that? If you work for $50 per hour and you spend 10 hours a week on social media creating content, curating, reaching out etc – it’s actually costing you $500 a week as you are needing to take time away from your money making activities to build your social media.

A goal for many business owners is that as they grow, they will stop trading time for money and start trading money for time – paying someone else to do this work so you can do what you’re an expert in! (But that’s a different discussion all together!)

Back to the topic at hand…lets go through my three reasons to have a marketing budget!


All businesses MUST have a marketing budget – this is honestly a non-negotiable.

WHY? Because as the old saying goes – you need to spend money to make money!

That’s my first reason why you need a marketing budget.

To make more money, more people need to know about:

  • what you do
  • how you do it
  • why they need your services or your products in their life
  • why they should come back over and over and over again (and bring their friends with them!)

This is like 101 Marketing!

BUT – In order to do the above steps efficiently, you need to have a paid marketing strategy.

Organic is great – fantastic actually! And we are SO lucky to have all this (somewhat) free ability to market our business via social media or word or mouth.

But realistically, the time will come when it’s time to put skin in the game and cough up some bucks for some marketing.

I’ll give you a couple of examples below from my business life of what the marketing budgets look like:

  • One of my businesses is an online marketplace called spendwithus.com.au (it’s like Amazon but only for rural and regional small businesses), we spent upwards of $1500 a month on marketing.

Between google ads, google shopping ads, Facebook and Instagram ads – we do a lot of paid marketing.

We have to! It’s our way of getting more brand awareness, and more sales traffic to our website and then to keep top of mind so they come back again.

We also invest in email marketing platforms as another part of our paid marketing strategy.

We are additionally investing in our business by buying ad space.

  • In my social media and marketing business, my “spend money to make money” is looks little different.

The budget for this is allocated to target times when I want promotion around a product or a service that I run ads for – it’s not 365 days a year as my other business.

But I do invest!

AGAIN – you have to spend money to make money – especially if your competitors have a paid marketing strategy to get in front of your audience and you don’t!

Of course, your total spending should be influenced by your specific goals for your business and analysis of the results you get from the marketing spend.  After all, you want to be able to say “my paid marketing strategy gave me x in return”.

BUT: Without a marketing budget, you are simply, leaving money on the table for your competitors to swoop in and enjoy.

  1. You need a marketing budget to SCALE UP!

If you want to grow your audience, or perhaps you’re a bit stagnant in business right now (covid issues aside), investing in your business with a paid marketing strategy will help you reach more of your target audience.

Once you are super clear on who your target audience is, who is most likely to buy your products and services, then it’s time to reach further than organic marketing can.

Having a marketing budget, something specifically allocated to spend on marketing, will make you more successful and give you something to measure that success against.

You will be able to analyse the results and say: “I spent $X on marketing and resulted in $Y in return!”

You will know if your allocation of resources had a good ROI – return on investment.

  1. A budget allows you to allocate your resources effectively.

The third reason is that having a marketing budget with a set figure allocated, allows you to target scarce financial resources more efficiently and effectively.

If you don’t have a set amount in your marketing budget, it makes it harder to make strategic decisions on whether or not you should spend $X on a marketing strategy.

Allocating some financials against marketing, allows you to grow even when things are tight. How? You can be assured simply by looking at your budget, that you have the financial resources to invest in x – whatever x is.

Also – when things are free, we take them for granted a bit. For example, you might be thinking:

  • “Is our copy not quite right?” and in the next thought be “Mmm, well it doesn’t really matter, didn’t pay for it.”
  • “Is our targeting on point?”  Mmm, doesn’t really matter, didn’t pay for it.
  • “Is our email program giving us the best return for the time to create the email newsletters?”  Mmm, doesn’t really matter – it’s free.

Whereas – when we are paying for something, as a business owner, we tend to more attention to the return on that investment.

We are more vary of results.  We are more likely to look at the results!

Here is a quick test of this theory:

  • How long how have you been spending time posting organically on social media?  How often do you look at the insights to see what’s working, what’s not?

I’m guessing pretty infrequently if at all.

  • How often have you run a paid marketing ad on social media and NEVER looked at the results?  I’m guessing you will be on top of exactly how much you spent and what results you gained from the ad!

Money talks – money makes us take notice.

Of course, there’s loads of free and low budget ways to promote your business too! And I have a great resource just for this in on of my podcast episodes. Check out episode 21 – 7 WAYS TO MARKET YOUR BUSINESS ON A SHOESTRING.

So you might now be thinking “Jenn, where do I spend my marketing budget?”

There’s a stack of places that you can invest your marketing budget.  There’s just a few:

  • Social Media Platforms
  • Content Creation
  • Paid Advertising
  • Website
  • Email Marketing
  • SEO
  • Paid Advertising (PPC)
  • Graphic Design
  • Print Material (Flyers & Brochures)
  • Networking
  • Hiring a coach and mentor
  • Podcasts
  • Hiring help (such as a virtual assistant)

You need to spend the money in your marketing budget where you can see the best return.

My hope for you is that after reading this blog you will assess who much you are relying on platforms for free to do all your marketing for you VS how much you are investing in yourself, and your business and the brand to help build and scale it.


If you’re not sure about a marketing budget, where to spend it, how much to spend and so forth – let’s chat! Book a call with me at: https://calendly.com/jenn-smm/discovery

And don’t forget – if you haven’t joined my Like Minded Business Owners facebook group, please do! You can ask me questions over there, and the community of business owners there is so fantastic in sharing of their knowledge and helping each other out.

Or you can DM me on Instagram or send me an email jenn@jenndonovan.com.au

I wish to acknowledge the Traditional Custodians of the land, the Yorta Yorta People, on which I conduct my business today and pay my respects to their Elders past and present. I extend that respect to Aboriginal and Torres Strait Islander peoples reading this blog post today.

About the Author:

Jenn Donovan of Social Media & Marketing Australia.  Jenn’s a coach and mentor from rural NSW and is all about empowering business owners to earn what they’re worth so they can make a bigger difference in the world.  The Founder of Buy From a Bush Business, Co-Founder of Spend With Us – Buy From a Bush Business Marketplace and host of the very popular podcast Small Business Made Simple, Jenn is all about community and humans interacting with humans!  H2H Marketing – human to human marketing. Jenn talks the talk but importantly walks the walk! Jenn’s online community is over 320,000 with her famous Facebook Group currently at almost 351,000 members and still growing every day.  She’s the major of her own little online city!

Get in touch – www.socialmediaandmarketing.com.au

On Instagram – @jenndonovan_

On Facebook – Jenn Donovan

Or on LinkedIn as Jenn Donovan


Submit a Comment

Your email address will not be published. Required fields are marked *


Brilliant – it’s on its way – thanks!


Brilliant – it’s on its way – thanks!


Brilliant – it’s on its way – thanks!


Brilliant – it’s on its way – thanks!

Pin It on Pinterest

Share This