How Do I Know If I Am Overspending On Marketing?
What Should My Marketing Budget Be Spent On?
It’s common to wonder, am I overspending on marketing? A healthy budget should drive leads and booked jobs without leaving you feeling drained. Research shows companies spend an average of 7–8% of revenue on marketing, with higher growth targets requiring 10% or more.
In this guide, you’ll learn how much to allocate, how to split spend between online and offline, and when exceptions apply.
How Much Money Should Be Allocated For Marketing?
A good guideline is to invest 8–12% of last year’s revenue, with 10% being a strong starting point. The higher your growth goal, the closer you’ll push toward the upper end of that range.
Example: a $1M company aiming for $1.5M in revenue might set a $100,000 annual marketing budget. That full amount includes agency fees, ad spend, SEO, and real-world promotions.
“I don’t need your entire marketing budget,” says Mark Sherwin, President & Co-Founder. “Honestly, I don’t want it all. You won’t be successful if you don’t spread your resources around properly.”
How Should I Split My Marketing Budget Between Online And Offline?
Balance depends on market density and customer habits:
- Rural areas: 60% online / 40% offline (community sponsorships, mailers, radio).
- Cities or tech-forward areas: 75% online / 25% offline (digital ads, SEO, review management).
“Make sure people are finding you in both places,” Mark adds. Omitting either channel risks leaving business on the table.
Can Anything Change The Recommended Budget?
Yes. Several factors can raise or lower spend needs:
- Business maturity: Established brands can often sustain results with less spend; new entrants may need more.
- New services or markets: Launching a new vertical requires heavier upfront investment to build awareness.
- Competition or aggressive goals: Rising rivals or ambitious revenue targets push budgets higher.
Mark explains: “A $10 million company that’s been in a market for 25 years will not have to spend at the same level as a $1 million company trying to break in. But even mature companies launching a new vertical should expect to invest more.”
Does A Bigger Budget Mean Less Work For Me?
No. A bigger budget means more collaboration, not less involvement. “Sometimes people think if they pay us more, they can forget about marketing,” Mark notes. “That’s not how it works. The more you invest, the more conversations and strategy alignment you should expect.”
Make Sure Every Dollar Drives Results
Your marketing budget should feel like fuel, not a drain. With the right partner, you’ll know where money is going, own your assets, and see progress toward growth goals.
Avoid wasted spend! Talk to us about a budget that builds real growth in your service area.
Frequently Asked Questions: Marketing Budget
What Percentage Of Revenue Should Be Spent On Marketing?
Most home service firms spend 8–12% of revenue, with higher percentages for faster growth.
How Do I Know If I’m Overspending?
If cost per booked job rises while revenue stalls, your spend may be too high for the outcomes.
Does A Bigger Budget Guarantee Results?
No. A larger budget means more activity, but you still need clear goals, good execution, and accountability.
How Do I Split Spend Between Online And Offline?
Rural areas often succeed with a 60/40 online/offline split; cities lean 75/25 toward online channels.
Can My Budget Change Over Time?
Yes. Factors like new markets, competition, and growth goals can shift the right percentage up or down.
Last updated: October 2025
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