“Half the money I spend on advertising is wasted – the trouble is, I don’t know which half.”

John Wanamaker, US department store merchant

Every marketer is familiar with this famous quote by John Wanamaker, who said it 100 years ago. And it still makes sense, unfortunately.

Although modern marketing professionals are armed with a variety of tools to analyze their activities across any channels or media type, most of them still struggle to show a clear path from marketing tactics to ROI.

According to the research that we at Growth Marketing Stage published the last year, over half (53%) of organizations cannot provide ROI of their marketing activities.

Today I want to share a few findings from the recent report on Marketing Budgets 2019-2020.

Marketing Budgest 2019-2020 report is based on a survey of almost 300 company and agency marketers. The report is free and you can get it today at the Product Hunt.

Marketing budget as a percentage of revenue 

Being a successful company isn’t necessarily about how much you spend — it’s about what percentage of the organization's revenue is invested in marketing. 

Ten percents — this is the number you will often hear whenever you ask how much of your revenue you should spend on marketing. But is that true for all the businesses?

To get an answer, we segmented the data about marketing budgets as a percentage of revenue by organization size and industry sector.

Marketing budget as a percentage of revenue by organization size:

The 10% number may be right for some businesses, but it’s not a one-size-fits-all figure.

The smaller the company is, the larger the percentage of revenue dedicated to the marketing budgets is.

Large companies, who are more established, have much higher revenue and are not looking for the same type of exposure as smaller companies might.

Marketing budget as a percentage of revenue by industry sector

Here’s what we discovered about marketing budgets, broken down by industry:

• 10% is not the magic number. Every industry is different.
• Retail companies are making significant investments in marketing.
• Organizations in the IT (product based company) sector tend to dedicate a greater percentage of their revenue to marketing expenses than outsourcing companies.

Marketing budget allocation

Whether you have a $100 monthly advertising budget or a $100,000,000 monthly budget, you want to get the most out of the investment. At the end of the day, it is all about maximized ROI. It should always be the goal of any marketing campaign.

Choosing the right marketing channels and tactics will help you get that ROI. But how do you know which marketing channels are the right ones to get you the most for your ad spend and your time?

While building this report, we have analyzed where marketing budgets are allocated now and which channels marketers plan to increase investments. We have also segmented the data by organization size and industry sector.

The allocation of marketing budgets

The allocation of marketing budgets by organization size

Marketing Budget Plans

While building this report, we have analyzed where marketing budgets are allocated now and which channels marketers plan to increase investments. We have also segmented the data by organization size and industry sector.

Marketers increasing investment into content and growth marketing

The majority of marketers are increasing their marketing budgets for content marketing, SEO, growth marketing, social media, PPC and PR. When considering outbound efforts, TV, and print ads, there are no huge plans on investment.

The growing potential of utilizing inbound tactics and growth marketing is most likely a result of cost-effectiveness of these channels.

Increasing marketing investment by organization size

Increasing marketing investment by industry sector

About Growth Marketing Stage

This report was created by Growth Marketing Stage, the leading destination for growth marketers.

Growth Marketing Stage is a global growth marketing conference hosted in Kyiv, Ukraine.

Growth Marketing attracts companies like Google, Booking.com, Dropbox, and Adobe, as well as the fastest-growing companies from Uber and HubSpot, to Naspers and Skyscanner.