The U.S. Small Business Administration recommends spending 7 to 8 percent of your gross revenue for marketing and advertising if you're doing less than $5 million a year in sales and your net profit margin — after all expenses — is in the 10 percent to 12 percent range.
Some marketing experts advise that start-up and small businesses usually allocate between 2 and 3 percent of revenue for marketing and advertising, and up to 20 percent if you're in a competitive industry.
Still other marketing experts counsel a range between 1 percent and 10 percent, and even more depending on how long you've been in business, competitive activity and what you can afford.
Business XYZ is projecting an estimated gross revenue of $500,000 this year.
Most of our current Better Merchants members are spending between 4-6% of their revenue with us on advertising which is within healthy range of the national average mentioned above.
Business XYZ should allocate $25,000 a year for membership management and media buys on television, cable, online, and so forth.
Sturdy numbers to consider at the very start of a long term campaign between your business and Better Merchants would be $2000-$2500 a month in spending which would cover advertising media buys, your monthly Better Merchants membership and management hours, along with production costs on video content to be used for various promotional pieces.
A Better Merchants membership gives businesses a break on hourly production rates, too. Most of our businesses are saving 25% or more on each project we develop for them!