How much should a small business spend on marketing?

What percentage of revenue should a small business spend on marketing?

There is no honest percentage, because nobody has measured one on businesses your size. The two figures that every article quotes are 7.8% and 9.0%, and both come from surveys of very large companies, mostly American.

Gartner's 2026 CMO Spend Survey, published on 11 May 2026, reported that marketing budgets came to 7.8% of company revenue, up from 7.7% in 2025. Gartner states its methodology in the release: 401 CMOs and senior marketing leaders in North America, the UK and Europe, surveyed between January and March 2026, with the vast majority reporting annual revenue over $1bn.

The CMO Survey, run out of Duke's Fuqua School of Business, fielded its spring 2026 round between 7 and 29 January 2026. It got 308 responses from US for-profit companies, 97% of them VP level or above, and reported marketing at 9.0% of company revenues. Its own breakdown is the interesting part: firms under $10m revenue reported 12.1% of revenue, firms over $10bn reported 7.9%.

So the smallest band in the better-broken-out survey is "under $10m", which in this country includes a builder with a van and a firm with ninety staff. A business turning over £150,000 is nowhere in either dataset. Applying 7.8% to it gives £11,700 a year, which is a number derived from the behaviour of companies a thousand times its size.

Where the 5 to 10% rule actually comes from

Three separate claims get blended into one rule of thumb, and only two of them have a source you can read.

"The US Small Business Administration recommends 7 to 8%"

This is the most-repeated version and I could not find the page it is supposed to come from. The widely syndicated Hearst article on Chron attributes 7 to 8% of gross revenue to the SBA and provides no link to any SBA page. I checked the SBA's own Business Guide section on marketing and sales on 15 September 2026: it tells you to include a complete breakdown of the costs of your marketing plan and to track spend against revenue generated. It names no percentage. If a UK agency quotes "the SBA recommends", ask them for the link.

"7 to 8% for B2C, less for B2B"

The nearest real source is Gartner's 7.8%, above. That is an all-industry average across companies mostly over $1bn in revenue. The B2C split you see quoted alongside it usually comes from The CMO Survey's industry breakouts, which are again US companies, and again at a scale where marketing is a department with staff, not a person deciding whether to renew a directory listing.

"10 to 20% if you are new"

I could not trace this one to any survey at all. It appears to be advice rather than measurement, and it is repeated most often on pages selling marketing services. It may well be sensible advice for a funded startup. It has no evidential basis for a trade or local service business, and a new business is precisely the one that can least afford to act on an unsourced number.

How much do small businesses actually spend on marketing?

Far less than the rules suggest, on the only large sample that exists. UENI, a website-builder company, published the marketing budgets its customers declared on its sign-up form: 7,413 responses, counted on 10 August 2026. Of those, 26.1% planned to spend nothing at all on marketing, 39.4% planned $1 to $50 a month, 24.9% planned $51 to $200, and just 3.8% planned over $500. In total 90.5% planned to spend under $200 a month.

Read that with the caveats UENI itself prints. It is a self-selected sample of people signing up to a cheap website builder, so it skews towards small budgets. It is in dollars. And it is stated intention, not measured spend. It is still the largest published sample of small-business marketing budgets I could find anywhere, and the shape of it is the opposite of 7.8% of revenue.

Is there any UK data on small business marketing spend?

No, and it is worth being blunt about that. There is no ONS series, no Department for Business survey and no trade-body study measuring what a UK small business spends on marketing. The ONS survey that comes nearest on anything adjacent, E-commerce and ICT Activity, last published 2019 data in February 2021 and only ever sampled businesses with ten or more employees.

The best genuinely UK evidence is older and narrower than you would like: IAB UK and MTM surveyed 1,199 UK SMEs for a study published in May 2022. It found 60% used paid digital advertising and 67% used free digital tools, and that the SMEs buying paid digital used an average of just 1.3 channels. That last figure is the useful one. Small firms that advertise do not run a mix; they pick one thing.

For scale, the AA/WARC Expenditure Report put total UK advertising investment at £46.7bn in 2025. That is the whole market, dominated by large advertisers, and it tells you nothing about a plumber in Fareham.

What does the money actually buy in the UK?

These are published prices from named sellers, all checked on 15 September 2026. Where a company does not publish, that is recorded as not published rather than filled in with a guess.

Two things stand out when you lay it out like that. The first is that the published prices for doing things yourself are an order of magnitude below the published prices for having them done. The second is that a single month of retained SEO costs more than a whole year of the local paper, the community magazine and the leaflet drop put together.

The website figures come from the eight UK firms that publish rate cards, and the renewal traps they hide are covered properly in how much does a website cost in the UK. The directory memberships are broken down in what Checkatrade actually costs.

Spending that stops working, and spending that keeps working

This is the distinction the percentage rules completely miss, and it matters more than the size of the budget. Almost every marketing cost falls into one of two kinds.

Rented. Google Ads, Meta ads, directory memberships, per-lead fees, sponsored listings. These deliver while the money is going out and stop the day it stops. On the day you cancel, you are back where you started with nothing to show for the spend except the jobs it brought at the time. That can be a perfectly good deal, but you have to price it as rent, not as an investment.

Owned. Your website and the pages on it, your Google Business Profile, the reviews on it, the answer you wrote to the question customers keep asking. These cost time and sometimes a one-off fee, and then they keep going. A service page written in 2024 is still being found in 2026 at no additional cost. The hosting bill continues either way, at roughly £100 to £180 a year.

Run the arithmetic once and it changes how you think. A Which? Trusted Traders membership for a small firm is £797 a year plus the £248 assessment. Over three years that is £2,639, and at the end of it you own nothing. The same £2,639 spent on owned assets buys a properly built site from a firm that publishes its prices, with change left over, and that site is still yours in year four.

That is not an argument against ever renting. Rent is the right answer when you need work this month, which is exactly what ads and lead sites are good at. It is an argument against renting first, and against renting indefinitely because cancelling feels risky.

Is Google Ads worth it for a small business?

It is worth it when one won job pays for a month of clicks, and you can work that out before you spend a penny. Two published facts make the sum possible.

First, Google sets no minimum spend. Its own help documentation on average daily budgets says you will never be charged more than twice your daily budget on any day, or more than 30.4 times your daily budget in a month. So a £5 a day budget cannot exceed about £152 in a month. Anyone telling you that you need £450 or £900 a month to start is quoting an agency's preference, not a Google rule.

Second, clicks are not cheap in trades. LocaliQ's 2026 search advertising benchmarks put the all-industry average at $5.42 a click, home and home improvement at $8.33, and legal at $9.87. That data is American and LocaliQ describes its sample only as thousands of its customers' campaigns, so do not convert it and call it a UK figure. I could not find a UK cost-per-click dataset published by anyone with a sample they disclose.

What you can do instead takes ten minutes: open Google Ads, go to Keyword Planner, and type the search you actually want to win. Google shows you the top-of-page bid range for your own area, in pounds. That is your real number, not a benchmark. Multiply it by the number of clicks it plausibly takes to win one job in your trade, and compare it to what the job is worth. If the sum does not work, no amount of clever management will make it work.

And before any of it, make sure the page the ad points at can take an enquiry. Paying for clicks to a page that does not convert is the most expensive mistake on this list, and the usual causes are in why your website isn't getting enquiries.

How to decide the number for one specific business

Work backwards from a job, not forwards from a percentage. Four questions, in order.

• What is one more job worth to you, in profit? Not turnover. If a bathroom refit turns over £4,000 and leaves £900, the number you are working with is £900.
• How many more of them do you want a month, realistically? This is a capacity question, not an ambition question. If you can take two more jobs a month, marketing that delivers six is money spent creating a waiting list and a reputation for not calling back.
• What are you prepared to pay to win one? A common answer among trades is somewhere between a tenth and a fifth of the profit on the job. At £900 profit, that is £90 to £180 to win it. That figure, times the jobs you want, is your monthly ceiling.
• Can you tell afterwards whether it worked? If the answer is no, the budget is irrelevant because you will never know which part to stop. Set up conversion tracking before you spend, not after.

Two jobs a month at £150 each gives a £300 monthly ceiling for a business turning over £150,000. That is 2.4% of revenue, arrived at from the business rather than from a survey of billion-dollar firms, and it is a number you can defend to yourself.

What to do if your marketing budget is genuinely zero

Then you start here, and honestly this is where most small businesses should start regardless of budget, because the free work is what makes any later spending pay. None of the following costs money. All of it is owned, not rented. Each item links to the guide that walks through it.

• Claim and complete your Google Business Profile. It costs nothing to create, claim or verify, and Google's help page says so in as many words. It decides whether you appear in the map results at all. Walkthrough: how to set up a Google Business Profile.
• Ask your last ten customers for a review. A text the evening a job finishes. BrightLocal's 2026 survey of 1,002 US adults found 97% read reviews for local businesses and 71% use Google to do it, and while that sample is American, nobody has published a UK figure that contradicts it.
• Write one page for each thing you sell. Not a services list with eight bullet points. One page per service, saying what it is, what it costs or what it depends on, and where you do it. This is the single highest-return unpaid job on the list: how to write a service page that gets found.
• Write one page for each town you cover. Same idea, geography instead of service, and with something genuinely local on it. How to create location pages that get found.
• Set up Search Console. Free from Google, and it shows you the words people actually typed before they landed on you, which is better market research than any agency will sell you. How to set up Google Search Console.
• Get listed in the free directories. Some charge, plenty do not, and the free ones still count. How to get your business listed in online directories.
• Email or text your past customers. Free up to 250 subscribers and 2,500 emails a month on MailerLite, or 300 emails a day on Brevo's free tier. A list of people who have already paid you is the cheapest source of work there is.
• Make sure the AI tools can read you. Increasingly people ask ChatGPT for a recommendation rather than searching. That is an owned-asset problem, not an ad budget problem: how to get your business on ChatGPT.

That list is perhaps two weekends of work. Done properly it puts a business ahead of most of its local competition, and it costs nothing but the hosting you are already paying for. If after all that the phone still is not ringing, then a budget is a reasonable next conversation, and you will at least be sending paid traffic somewhere that works.

What changed in this guide

Two corrections worth flagging if you read the earlier version of this page. MailerLite's free tier is now 250 subscribers and 2,500 emails a month, not 500 subscribers; if you were relying on the old allowance, check your list size. And the £1.95 average UK cost per click quoted here previously has been removed: on rechecking, I could not find a UK cost-per-click dataset from any organisation that publishes its sample, so the figure is not defensible and Keyword Planner is the honest substitute.

Common questions

What percentage of revenue should a small business spend on marketing?

There is no percentage that has ever been measured on businesses your size in the UK. The two real surveys behind the rule are Gartner's 2026 CMO Spend Survey, which found 7.8% of company revenue among 401 senior marketers at firms mostly turning over more than $1bn, and The CMO Survey of January 2026, which found 9.0% among 308 US marketing leaders. Neither sampled a UK sole trader. Use the percentage as a ceiling you would be uncomfortable crossing, not a target to hit.

How much should a small business spend on marketing per month?

Nobody publishes a defensible UK figure, so treat any monthly number you are quoted as the seller's opinion. The nearest real data is UENI's sample of 7,413 businesses signing up to its website builder, counted on 10 August 2026: 26.1% planned to spend nothing at all, 39.4% planned $1 to $50 a month, and 90.5% planned under $200. UENI says openly that the sample is self-selected towards small budgets, and the figures are in dollars.

How much do small businesses spend on advertising in the UK?

I could not establish a UK figure, and I am not going to invent one. There is no ONS series, no government survey and no trade-body study that measures what a UK small business spends on marketing. The closest UK evidence is the IAB UK and MTM study of 1,199 UK SMEs published in May 2022, which found 60% used paid digital advertising and those that did used an average of only 1.3 channels. Every UK-branded percentage on page one of Google traces back to American data.

Is Google Ads worth it for a small business?

It depends entirely on what a job is worth to you and what a click costs in your trade, and you can check the second part before spending anything. Google sets no minimum spend: its help pages say you will never be charged more than 30.4 times your average daily budget in a month, so £5 a day caps at about £152. The honest test is whether one won job covers a month of clicks. LocaliQ's 2026 benchmarks put home and home improvement at $8.33 a click, on US data.

What is the cheapest way to advertise a small business in the UK?

The cheapest published options are the ones you already own. A Google Business Profile costs nothing to create, claim or verify, and Google's own help page says so. An eighth of a page in a weekly local paper was £30 including VAT on Local News Advertiser's own rate card in September 2026, and a quarter page £45.60. Royal Mail's own page says £200 could reach up to 3,000 homes with a leaflet. Email to past customers is free up to 250 subscribers on MailerLite.

How much does a marketing agency cost per month in the UK?

On the Whito UK Marketing Cost Index, which collected 128 published prices from 47 UK providers and was last updated on 11 September 2026, local SEO ran £300 to £800 a month, Google Ads management £200 to £800 with a freelancer or £500 to £1,500 with an agency, and basic social media management £250 to £500, all excluding VAT. Whito states plainly that this is collected published pricing, not a survey. Ad spend sits on top of management fees.

Do I have to pay for a directory listing to get work?

No, and the ones that charge are among the costs that stop working the moment you stop paying. Which? Trusted Traders publishes its prices: a non-refundable assessment fee of £248 including VAT, then £66 a month or £797 a year for a business with nought to three employees. Checkatrade publishes a £250 plus VAT application fee but not its membership prices. Free listings, including your own Google Business Profile, come first.

What should I spend money on first if my budget is very small?

On nothing, until the free things are genuinely done. Claim and complete your Google Business Profile, put a real service page up for each thing you sell and each town you cover, ask your last ten customers for a review, and set up Search Console so you can see what people actually type. That is a weekend of work, costs nothing but the hosting you already pay, and it is the part that keeps working after you stop.

Sources, all checked 15 September 2026. Gartner press release, “Gartner 2026 CMO Spend Survey”, 11 May 2026 (7.8% of company revenue, up from 7.7% in 2025; 401 CMOs and senior marketing leaders in North America, the UK and Europe, surveyed January to March 2026, vast majority reporting annual revenue over $1bn). The CMO Survey, Highlights and Insights Report, spring 2026, Duke University Fuqua School of Business (fielded 7–29 January 2026; 308 US for-profit respondents, 97% VP level or above; marketing at 9.0% of company revenues and 9.6% of overall budgets; under $10m revenue 12.1%, over $10bn 7.9%). Chron (Hearst), “What Percentage of Gross Revenue Should Be Used for Marketing & Advertising?” (attributes 7 to 8% to the US Small Business Administration with no link to any SBA page). US Small Business Administration Business Guide, Marketing and sales (no percentage given; tells you to break down the costs of your plan). UENI, “Small Business Marketing Budget 2026” (7,413 sign-up responses counted 10 August 2026: 26.1% nothing, 39.4% $1–$50, 24.9% $51–$200, 5.7% $201–$500, 3.8% over $500; UENI states the sample is self-selected towards small budgets and not representative). IAB UK and MTM, “Powering Up: Helping UK SMEs unlock the value of digital advertising”, published 24 May 2022 (1,199 UK SMEs; 60% using paid digital advertising, 67% using free digital tools, average 1.3 paid channels). Advertising Association / WARC Expenditure Report (£46.7bn UK media investment in 2025). Local News Advertiser rate card, localnewsadvertiser.co.uk/prices (eighth page £30, quarter page £45.60, full page £120, back page £300, all including VAT; 4,500 homes weekly in north west London). CommunityAd, advertising prices page (its own magazine rates from £45 to about £300 for a full page across 60+ regional titles including Hampshire). Royal Mail Door to Door / Drop a Leaflet pages (“for as little as £200 you could reach up to 3,000 potential new customers”; Royal Mail does not publish a rate card, quoting on area, quantity, size and weight). Which? Trusted Traders join site, for-traders.which.co.uk (non-refundable assessment fee £248 including VAT for 0–3 employees; membership £66 a month or £797 a year for 0–3, £86 or £1,029 for 4–9, £114 or £1,363 for 10–19). Checkatrade Master Service Terms (Application Fee of £250 excluding VAT). LocaliQ, “Search Advertising Benchmarks 2026” (all-industry average cost per click $5.42; Home & Home Improvement $8.33; Attorneys & Legal Services $9.87; described only as thousands of its customers' campaigns, US data). Google Ads Help, “About average daily budgets” (no minimum spend; you will not be charged more than twice the daily budget on a day or 30.4 times it in a month). Google Business Profile Help, “Add or claim your Business Profile” (at no charge). MailerLite pricing page (free plan 250 subscribers and 2,500 emails a month; Comfort from $12 a month billed annually). Brevo pricing page (free plan 300 emails a day; its paid prices did not render on the page when checked). Whito UK Marketing Cost Index, whito.co.uk, last updated 11 September 2026 (128 published prices collected from 47 UK providers; local SEO £300–£800 a month, PPC management £200–£800 freelancer and £500–£1,500 agency, basic social media £250–£500, all excluding VAT; Whito states this is collected published pricing rather than primary survey data). Published UK website prices from Buzz Web Design (£175 + VAT single page, £390 + VAT five pages) and London Website Design Services (£1,200+ for eight pages), with hosting and domain renewal figures from Krystal, Mythic Beasts and 123-reg. ONS E-commerce and ICT Activity survey (last published 2019 data in February 2021; businesses with ten or more employees only). BrightLocal Local Consumer Review Survey 2026 (1,002 US adult consumers; 97% read reviews for local businesses, 71% use Google). Could not be established, and deliberately not estimated: any UK survey of what small businesses spend on marketing; any UK cost-per-click dataset with a disclosed sample; the source of the “7 to 8%, US Small Business Administration” claim; the origin of the “10 to 20% if you are new” rule; Royal Mail's per-thousand Door to Door rate card; Checkatrade's monthly membership prices; and Brevo's paid plan prices.