For businesses generating around $5 million in annual revenue, growth often relies on personal connections. However, to scale effectively, business owners must shift their focus from individual relationships to robust marketing systems. The average marketing budget should ideally range from 10%-11% of revenue to drive growth, especially if aiming for a revenue increase of 15%-25%. High-performing companies typically allocate 35%-40% of their budgets to personnel involved in marketing efforts, underscoring the need for a strategic approach.
You can't scale yourself. You can only scale systems. The most effective system for attracting and converting new customers is a well-funded, strategically led marketing function.
According to Gartner's 2024 CMO Spend Survey, the average marketing budget across industries is 7.7% of total company revenue, a decrease from 9.1% in 2023.
If your business is growth-oriented, particularly if you're looking to scale revenue by 15% to 25% or expand into new markets, a budget of 10% to 11% of revenue is more appropriate.
High-performing companies devote 35% to 40% of their marketing budget toward personnel, which includes in-house talent or a retained agency.
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