The Marketing Budget Dilemma: How Much Should You Really Spend?

The Silent Business Killer

Many businesses struggle with one crucial question: How much should we spend on marketing?

For some, the answer is very little—or even nothing at all. Business owners often view marketing as a discretionary expense rather than a necessary investment. But here’s the hard truth: if you're not actively marketing your business, you're making it harder for customers to find you, trust you, and choose you over competitors.

Marketing isn't just about advertising—it’s about creating awareness, building relationships, and driving sales. Without it, even the best businesses can struggle to survive.

Why Businesses Underspend on Marketing

At Raydius, we frequently hear business owners say:

“We get most of our customers through word-of-mouth.”
“We don’t really have the budget for marketing right now.”
“Marketing doesn’t seem to bring in enough ROI.”

We get it. Expenses pile up—rent, payroll, inventory, equipment, maintenance. Marketing often feels like the thing you can “figure out later.” But what happens when later turns into never?

When businesses neglect marketing, they set themselves up for a slow decline. Here’s why:

✅ Word-of-mouth isn’t scalable. While referrals are great, relying on them alone limits growth. What happens when referrals slow down?

✅ If you don’t invest, your competitors will. The businesses that actively market themselves will gain more visibility, attract more customers, and dominate your local market.

✅ Marketing is a long-term game. Unlike a quick expense, strategic marketing builds brand equity, customer loyalty, and a steady revenue stream over time.

How Much Should You Be Spending on Marketing?

There’s no magic number, but a good rule of thumb is to allocate 5-10% of your revenue to marketing.

New businesses or aggressive growth companies: 10%+ of revenue should go toward marketing to build brand awareness and customer acquisition.
Established businesses with steady revenue: 5-7% is a sustainable range to maintain and expand your reach.

For example, if your business generates $500,000 in revenue, you should allocate between $25,000 - $50,000 annually for marketing. If you’re pulling in $1 million, that range jumps to $50,000 - $100,000.

That budget covers things like:📢 Paid digital ads (Facebook, Instagram, Google, TikTok)📧 Email marketing campaigns to nurture customers📍 Local promotions and sponsorships to stay top-of-mind in your community🎥 Social media content creation (video, graphics, and engagement strategies)🛠 Website SEO & updates to ensure customers can find you online📊 Market research & analytics to optimize what’s working

The key is not just spending money—but spending it wisely.

What Happens When You Don’t Invest in Marketing?

If you’re spending $0 on marketing, you may not feel the effects immediately—but over time, here’s what happens:

❌ Customer acquisition slows down. If people aren’t hearing about your business, they’re not visiting or buying.

❌ Competitors gain the upper hand. Businesses actively advertising and engaging customers will attract the very people you could be reaching.

❌ Revenue stagnates or declines. Without a steady stream of new and returning customers, your business will plateau—or worse, shrink.

Marketing is like oxygen for your business—you may not see it, but you’ll definitely feel it when it’s missing.

Marketing as an Investment, Not an Expense

When done strategically, marketing isn’t a cost—it’s a revenue generator.

Think about it:💰 If you spend $1,000 on a targeted ad campaign that brings in $10,000 in sales, that’s not an expense—it’s a smart investment.💰 If you invest in email marketing that converts leads into long-term customers, that’s a recurring revenue stream.

It’s about creating a system where marketing dollars generate more revenue than they cost. That’s how businesses scale.

Not Sure Where to Start?

If your business isn't seeing the growth you want, it might be time to rethink your marketing strategy.

At Raydius, we specialize in turning marketing investments into real, measurable results for Family Entertainment Centers (FECs) and location-based businesses. Our data-driven approach ensures that every dollar spent is working toward your business growth.

Need help building a smarter marketing plan? Let’s talk strategy. 🚀