Every percent-of-revenue rule you’ll find online is an average of other people’s businesses. Search “how much should a home services business spend on marketing” and the confident answers stack up: 5%, 7 to 8%, 10%, each presented as settled fact, none of them aware of your close rate, your average ticket, or whether your trucks are already full. The better method runs backwards from the job: what a booked job is worth to you, what one costs to get, and how many more you want. The percentage is an output of that math, not an input to it.
Still, the survey numbers are worth knowing, partly for context and partly because the most famous one turns out not to exist. Start there.
What the surveys say, for what they’re worth
The real numbers are higher than most owners expect, and they come from companies nothing like yours. Marketing budgets averaged 9.0% of company revenue in the most recent CMO Survey, fielded in January 2026 across 308 US marketing leaders 1. Gartner’s 2025 survey pegs it lower, at 7.7% of revenue, flat for a third straight year 2.
Look at who answered, though. These surveys poll marketing executives at companies large enough to employ marketing executives. The average small business marketing budget quoted in blog posts is usually one of these figures, handed down and stretched to fit a company one-thousandth the size. A bank spending 9% and a plumbing company spending 9% are not making the same decision.
The SBA rule nobody can find
The most-quoted budgeting rule in this genre does not exist at its supposed source. “The SBA recommends spending 7 to 8% of revenue on marketing” appears in hundreds of articles, agency sales decks, and bank loan guides, attributed to the US Small Business Administration. The SBA’s live page on marketing budgets does not say it 3. What that page does cite is an average marketing spend of 7.9% of revenue, from a 2018 Web Strategies figure, alongside much lower advertising-only averages of around 1% of revenue 3.
Somewhere along the way, “one survey found” got laundered into “the government recommends,” and the copies have been copying each other since. There’s a practical use for knowing this: if an agency quotes the SBA rule at you in a sales call, you’ve just learned how carefully it checks its numbers before repeating them.
Why a percentage of revenue is the wrong tool anyway
A marketing percentage of revenue tells you what other companies spent, not what you should spend. The published averages blend software companies, restaurants, hospitals, and consumer brands, businesses with wildly different margins and completely different ways of winning a customer. Your neighbor’s 8% carries no information about your business, because the two numbers that decide your budget, what a booked job is worth in gross profit and what a booked job costs you to get, appear nowhere in a percentage.
Picture two HVAC companies, each doing $2 million a year. One closes 70% of its estimates and runs a $9,000 average replacement ticket; the other closes 40% and lives on $250 service calls. The identical marketing budget for a small business in that revenue band, copied off a chart, would be roughly right for one of them and badly wrong for the other. The chart can’t tell you which one you are. Your books can.
Budget from the job backwards
Start with three numbers you can pull from your books this week: gross profit on an average job, cost per booked job, and how many more jobs you want. Say an average job brings $650 in gross profit, meaning revenue minus the materials and labor to deliver it. Say a booked job costs you about $120 to get, blending Google’s pay-per-lead listings with referrals. And say you want 30 more jobs a month.
The math finishes itself: 30 jobs at $120 each is $3,600 a month in marketing spend, and it returns 30 jobs at $650 each, or $19,500 a month in gross profit. The budget question just became a return question: would you pay $3,600 for $19,500, every month? Anyone would. And if your own numbers don’t produce an answer that obvious, the problem isn’t the budget line; it’s the cost per booked job or the close rate, and fixing either beats spending more. This is the arithmetic we run before quoting any engagement, and it’s the same arithmetic you should run on us.
If you don’t know your cost per booked job yet, build a rough one the way we do in audits: add up everything you spent on marketing over the last 90 days, divide by the number of jobs you can trace back to it, and accept that the first version is imperfect. A rough number you own beats a precise percentage you borrowed.
When to spend more, and when to stop
Spend more when you have somewhere to put the work. A season turning, a new truck to fill, a second territory to open: these are the moments the backwards math supports a bigger number, and the demand is there to buy. Contracting trades saw new scheduled work grow 8% and revenue grow 10% year over year in March 2026, per a report covering more than 100,000 service businesses 4.
The stop signal is just as concrete. If you’re booked out four weeks, fix capacity, not marketing. Dollars spent while you’re booked solid buy longer wait times, annoyed customers, and leads you pay for and can’t serve. Marketing budgets should breathe with capacity, which is one more thing a fixed percentage can’t do. Before any increase, run the physical test, not the financial one: point to where the next 20 jobs will go, which crew, which weeks, before you buy them.
The budget lines owners forget
The ad bill is not the whole budget, and the forgotten lines are usually the ones holding results back. The website that turns a click into a call is marketing. Photos of real jobs, shot by your crew on a phone, are marketing, and they outperform stock images everywhere they appear. An answering service or after-hours line is marketing, because it converts spending into booked jobs instead of voicemails; that conversion machinery is the whole argument of our piece on the right order to advertise in.
Budget for those before scaling the ad line, and put honest dollar figures on them so the return math stays honest too. Questions about what sits inside an engagement’s scope, and what stays yours to run, are answered on the FAQ page.
The right budget is the one you’d happily double, because you know what a booked job is worth, what it costs, and that the gap between those numbers is profit. Get to where you can say that sentence with your own figures in it, and the percent-of-revenue charts become trivia.