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Marketing Budgets
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Watch or Listen | My 2 Cents Podcast Episode #1

CFO's advice for managing Marketing Budgets | Michelle Kvello [Lantern Partners]

In this episode, our guest is Michelle Kvello, Fractional CFO & founder of Lantern Partners, named one of the Top 50 Women in Accounting. We’re discussing marketing budgets, how they’re set and how they’re typically spent.

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Michelle Kvello: CFO's advic... May 13 · My 2 Cents Marketing Pod... 34:29   ​

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Marketing Budgets - Survey Results

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103 Aussie Marketers contributed to our survey - thank you!

Q: What is your total annual marketing budget

Our first-ever marketing survey yielded some interesting results! Most of our respondents are smaller businesses with modest marketing budgets, with less than 5% spending more than $250K annually.

Q: How is your marketing budget set?

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Unsurprisingly, most businesses set marketing budgets as a fixed percentage of revenue. As much as marketers often like to believe that they decide the overall allocation, it’s most commonly decided by the owner or CEO of the business and is highly dependent on the company’s fiscal health. The reasons cited for the fixed percentage model include the ability to scale allocations with revenue attainment as well as simplifying and integrating with broader company-wide financial plans.

Marketers spend on average between 10-13% of revenue on marketing, with a broad correlation of % spend and company size: the larger the organisation, the bigger the spend.

Q: How is your marketing budget allocated?

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As we anticipated, it appears that rumours of the demise of email are greatly exaggerated! Here are the top three channels:

1. Email
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   ​This is seen as the most cost-effective channel for all types of business and is used to acquire and nurture new leads and existing customers. The ability to more accurately measure ROI supports its dominance — which was also noted by Hubspot in their State of the Marketing Report 2024 (both email and paid social were tied at #2 as the most effective channels, resulting in the largest ROI).
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2. Content Marketing​
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   Content is still king, focusing on delivering helpful, educational or entertaining content. AI now plays a major role, especially for smaller businesses, offering tools to streamline the generation of ideas and content creation — traditionally, these were common challenges.
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3. Paid Social​
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   Somewhat surprisingly, paid social has pipped paid search for third spot. This shift suggests that marketers are prioritising awareness and engagement, together with social media’s range of interactive formats. As one of our respondents says: “I can quickly increase brand exposure, accurately target audiences and enhance brand engagement”.
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   ​Takeaway: Paid social platforms — still primarily Facebook and Instagram — are especially cost effective for smaller businesses. We’ve also noted this trend with our clients: as CPMs are levelling out or even declining, there are opportunities to effectively target and run balanced brand and lead generation campaigns. ​
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Take part in our next survey, which is now live!

This month, we're discussing AI and its implications for marketers. Keen to hear what tools you're using (beyond ChatGPT) and any interesting use cases.

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