How Much Should a Small Business Spend on Marketing? (New Zealand Guide)
Aug 21, 2026How Much Should a Small Business Spend on Marketing? (New Zealand Guide)
Most New Zealand small businesses should spend around 7 to 10 percent of revenue on marketing, rising to 12 to 15 percent in growth phases or competitive markets. Split that across the channels where your customers actually are, and track cost per lead so your budget follows what works rather than guesswork.
"How much should I spend on marketing?" is one of the hardest questions for a small business owner, because the honest answer, "it depends", is useless when you need a number. So here is a practical framework that gives you a real starting figure.
The percentage-of-revenue rule
The common benchmark is to spend a percentage of your revenue on marketing:
- Established, steady business: around 7 to 10 percent of revenue.
- Growing or in a competitive market: 12 to 15 percent or more, because you are trying to take share.
- Brand new business: often higher as a share of early revenue, because you are building awareness from zero.
So a business turning over $500,000 a year might budget $35,000 to $50,000 for marketing. That includes everything: ads, tools, content, and any help you pay for.
How to split the budget
Once you have a total, divide it by where your customers actually are, not by what is trendy. For most small businesses that means a mix of: search (Google Ads and SEO), social, email, and your website. If your customers search for you, weight toward Google. If they discover businesses like yours on Instagram, weight toward social. Start roughly even, then shift money toward whatever brings the best cost per lead.
The number that matters more than the budget
The total is less important than tracking cost per lead, what it costs you to generate one genuine enquiry from each channel. Once you know that, budgeting becomes obvious: put more into the channels with the lowest cost per lead, less into the expensive ones. Your budget stops being a guess and starts following evidence. Government data on the small business landscape is available from Stats NZ.
Start where you are
If percentages feel abstract, start with a number you can afford to test with for three months, spend it on one or two channels, measure the cost per lead, and let the results guide the next quarter. A small, well-tracked budget that you actually learn from beats a big one you spend blind.
Frequently asked questions
How much should a small business spend on marketing?
A common benchmark is 7 to 10 percent of revenue for an established business, rising to 12 to 15 percent or more when growing or in a competitive market. This covers everything: ads, tools, content, and any help you pay for.
How do I split my marketing budget across channels?
Divide it by where your customers actually are: a mix of search, social, email, and your website for most businesses. Start roughly even, then shift money toward whichever channel delivers the lowest cost per lead.
What percentage of revenue should go to marketing in New Zealand?
Around 7 to 10 percent of revenue is typical for an established New Zealand small business, and 12 to 15 percent or more during growth phases. Adjust for your margins and goals rather than treating it as a fixed rule.
What is the most important marketing budget metric?
Cost per lead, what it costs to generate one genuine enquiry from each channel. Once you know it, you can confidently put more budget into the cheapest channels and less into the expensive ones.
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