How Much Should a Small Business Spend on Marketing in NZ?

An honest answer that’s more useful than “5–10%”

Ask the internet how much you “should” spend on marketing and you’ll mostly get: “Somewhere between 5 and 10% of revenue.”

Cool. And how helpful is that, on a scale from “cheers, mate” to “why did I bother Googling this?” Percentages are cute. But most NZ business owners aren’t sitting around with a perfect spreadsheet, clear strategy, airtight offers, and all channels humming. They’re in the real world juggling capacity, staff, cashflow, and a social feed that hasn’t seen a post since last Easter.

So let’s talk about marketing budget the way it works on this side of the world.

Why the 5–10% Rule Kind of Sucks

The generic advice assumes:

You already know what channels work for you
You already have your positioning and messaging sorted
You already have tracking in place
You already have time or people to execute

Probably, most importantly, also that you have that kind of available cashflow to spend.

Most small businesses have… none of that. It’s not realistic or achievable as a starting point.

So “5–10% of revenue” mostly just tells you how much money you’re about to set on fire if you guess the rest.

A better first question than “how much” is “for what?”

For leads?
For visibility?
For getting you off the tools?
For launching a new service?

Different goals need different budgets and timelines.

Stage 1: Scrappy and Proving It (Under ~$150k)

At this stage, your job is not “dominate the market.” Your job is “prove this thing works, and people will pay for it more than once.”

Where your marketing budget should go:

Website that doesn’t suck.
It doesn’t need to win awards. It does need to say what you do, who it’s for, why it’s useful, and how to book.
Rough ballpark: $1.5k–$4k one-off if you don’t DIY.
One main channel.
Not “everywhere”. One. LinkedIn, Instagram, Facebook — pick where your people actually are and show up consistently.
Proof: reviews, testimonials, case studies.
Screenshots count. Videos if possible. People want to see that some other human has survived working with you and recommends it.
Your time.
This is the bit most people don’t count. The DMs, freebies for exposure, coffees, follow-ups, quotes, and proposals? That’s marketing too.

Realistic cash spend at this stage:
$500–$1,500/month, plus your time. More than that is usually overkill until you’ve nailed the basics.

Stage 2: Stable But Stretched ($150k–$500k)

You’ve got clients. You’re not wondering if the business exists next year. But you are wondering why growth feels like dragging a fridge uphill.

This is usually when “we should probably do more marketing” shows up in your brain every time you reheat your cold cup of tea.

Where your marketing budget should go:

Brand and messaging tidy-up. The version of you online probably doesn’t match how you actually operate now. Fix that first. Clarity converts.
SEO + content that answers very real questions. Not salesy blogs. Stuff your ideal client would genuinely Google, plus location-based content if you’re local.
One or two paid channels. Google Ads if people search for what you do when there’s a problem Paid social if you need to stay top of mind and your service needs warming up
Email marketing that isn’t a sad “newsletter”. Onboarding sequences, nurture emails, offers that don’t feel sleazy. Automations that stop you manually chasing every human forever.

Realistic total marketing spend at this stage (time + money):
$2,000–$5,000/month once you include strategy, implementation, and ad spend.

Stage 3: Proper Growth Mode ($500k+ or Actively Scaling)

By now, “doing nothing” with marketing is genuinely risky. Relying purely on word of mouth works… until it doesn’t.

You want your marketing to be so foundational that you can set your clock by it. Guesswork will cost you big and be a lot more miss than hit.

Where your budget goes now:

Consistent content across 2–3 strong channels (not seven weak ones)
SEO, paid, and email working together, not in shallow silos
Someone owning it, whether that’s in-house, external, or hybrid. “Everyone’s job” always means “no one’s job”
Regular strategic reviews so you don’t run last year’s playbook out of habit

Realistic total marketing spend:
7–12% of revenue, but finally used with intent instead of vibes.

What $500/Month Really Buys You Here

Let’s front this by being clear that $500/month isn’t a “marketing budget.” You could call it a test budget at most. Here’s what it can realistically do on its own:

Pay for a couple of hours of specialist strategy — surprisingly high ROI if you actually implement what you’re told
Fund a small, tightly targeted Google Ads campaign while you learn, if your landing page converts and your offer is tight
Cover one solid blog or email per month written properly, that you can repurpose into social content

What it won’t do:

Run “everything”
Fix unclear offers
Compensate for zero strategy and a broken website

Trying to spread $500/month across four channels will not cut it. Anyone telling you different is lying to you.

The Costs Everyone Overlooks

Many business owners will tell you: “We don’t spend much on marketing.”

Then you add it up:

The time writing posts, emails, and proposals
The staff member they’ve turned into a part-time marketer
The tools (Canva, schedulers, email platforms, CRM)
The random boosts and campaigns “just to see what happens”

The real bill is often double what you think.

The point here is not “spend less.” But you should know exactly what you are spending, then decide if it lines up with what you’re getting back.

The 60/40 Thing

Zooming out for a second:

About 60% of your marketing effort should be long-term brand building — content, reputation, being remembered for something specific.
About 40% should be short-term activation — ads, campaigns, offers, “we’d like you to do something now.”

Most NZ businesses do 95% activation (“buy now, book now, limited spots!!”) and then wonder why nobody feels particularly loyal and why ads get more expensive over time.

Brand makes performance cheaper. Performance makes brand pay off. You need both. Again: in that order.