Several credible studies conducted in 2023 put the average benchmark for B2B marketing budgets at about 10% of revenue
How much money should a company invest in B2B marketing?
As companies plan their budget for 2024, here’s a look at three credible benchmarks for B2B marketing budgets.
1. The CMO Survey: 9.2% of revenue invested in marketing
The CMO Survey comes out twice a year in the spring and fall. The most recent version for the Fall of 2023, polled 316 respondents, of which about 96% hold titles of vice president or above.
Overall, the survey puts the average marketing budget at 9.2% of revenue:
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B2B product companies put their average marketing budget as a percentage of revenue at 7.9% – that’s about half of what their peers in B2C product companies spend. About 40% of respondents (N = ~126) to this edition of the survey are from B2B product companies.
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Source: The CMO Survey Fall 2023 by Christine Moorman in collaboration with Deloitte, Duke/Fuqua and the American Marketing Association
2. Gartner: 9.1% of revenue invested in marketing
The technology analysis firm Gartner conducts an annual poll of marketing. Gartner doesn’t provide a lot of details on who it polls, but I believe it’s reasonable to guess they are polling their subscription clients, which in my experience tend to skew towards larger tech companies.
The latest edition for 2023 polled 410 marketers and found marketing budgets as a percentage of revenue hovers at 9.1% of revenue.
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Source: The State of Marketing Budget and Strategy in 2023 by Gartner
3. SaaS Capital: 10% of revenue invested in marketing
SaaS Capital provides venture debt to high-growth companies. They’ve been conducting and annual survey of private SaaS companies for 12 years with many benchmarks. This is probably the best benchmarking study of the B2B tech companies I tend to work with.
In 2023, they polled some 1,500 privately held SaaS companies and found they invest a median of 10% of revenue on the marketing budget. The survey also provides a breakdown by annual recurring revenue (ARR) which is useful
Companies with:
- less than $1 million in ARR spend a median of $18,540 on marketing;
- $1-$3 million in ARR spend a median of $145,000 on marketing;
- $3-$5 million in ARR spend a median of $400,000 on marketing;
- $5-$10 million in ARR spend a median of $732,000 on marketing;
- $10-$20 million in ARR spend a median of $1,518,933 on marketing; and
- with more than $20 million in ARR spend a median of $4,640,637 on marketing.
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Source: 2023 Spending Benchmarks for Private B2B SaaS Companies by SaaS Capital
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Keep in mind these are all averages – so there’s always a segment that spends more or less. Money doesn’t solve everything and marketing can burn through cash easily on programs that aren’t moving the needle. However, if you are spending less than these benchmarks and you aren’t happy with the results from your marketing shop, then you might be underinvesting in B2B marketing.
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Image: Respective studies and DALLE, “draw a picture of a marketing dollars and make it look like the painting starry night”
