Small Business Marketing Budget Recommendations for 2022


In the simplest terms, your marketing budget should be a percentage of your revenue. 

The U.S. Small Business Administration recommends spending 7 to 8 percent of your gross revenue for marketing and advertising if you’re doing less than $5 million a year in sales and your net profit margin – after all expenses – is in the 10 percent to 12 percent range.

How to maximize your marketing budget

Three key ways to attract new clients using marketing

The key to keeping marketing spend low while getting the most bang for your buck is to prioritize how you spend your budget. The three key ways to attract new clients or customers. They are, in order of priority:

  1. Word-of-mouth referrals

  2. Search Marketing

  3. Paid Advertising

Word Of Mouth Referrals

There is no marketing tactic more powerful than one person telling another person how terrific your business is. Word of mouth referrals will always be the best, no cost marketing technique to drive sales.

A happy client or customer who has positive things to tell others about your products and/or services is the most valuable marketing asset that your small business can possess. 

Search Marketing

Properly conducted search marketing can connect your business with consumers that are searching for your services or products at the time they need what your business provides. 

The two primary types of search marketing are Search Engine Marketing (SEM) and Search Engine Optimization (SEO). 

SEM is the practice of paying a search engine company, such as Google, to display a link to your website on the Search Engine Results Page (referred to as SERP) when people search for keywords and phrases that you specify. Google or Bing then charge you when someone clicks on your ad. Determining the most appropriate keywords is best left to your digital marketing professional who can use SEO tools to choose the best keywords for the products and/or services you are selling. 

SEO is the marketing principle of increasing your website’s  visibility (aka “ranking”) in organic search (non-paid). Activities associated with SEO include keyword research, content development and link building. 

Organic search is a much lower cost marketing technique but takes much longer to see results. The results, however, are much longer lasting. Your digital marketing professional will probably recommend a combination of both depending on your marketing budget. 

Paid Advertising

Many small businesses are familiar with the traditional methods of advertising their businesses but are mystified when it comes to advertising on digital marketing platforms. There are many different types of digital marketing ad avenues to explore ranging from search ads to video and display ads. 

Many of these advertising options are