Table of Contents
Introduction
We’ve talked to a lot of founders over the years. Through those conversations, we’ve learned a lot about what growing businesses surrounded by great uncertainty need to be successful. And through our experience of being in the business of branding, websites, and marketing full-time, we’ve gotten pretty good at understanding where a budget has to go to meet certain needs.
If you’re speaking to an audience of potential clients and customers and balancing the needs of potential investors who want to know that you have what it takes to withstand the tests of time and the changing market, you definitely have more in mind than the average bear. So how do you think about the right dollar amount to put on that correct communication? What is the investment that you should be making in creating visibility and leaving an impression with customers and investors alike?
Marketing isn’t a one-size-fits-all game, especially for startups. You need a strategy that aligns with your unique goals and your specific audience, all while maximizing the impact of every dollar. Poorly allocated budgets can waste precious resources, leaving your growth stagnant or, worse, your funding runway prematurely shortened.
I’m going to go a little deep on this one, and really flesh out what you need to know to make your marketing budget make sense for 2025. I hope I can help you avoid some common pitfalls, make some smart decisions backed by my experience in startups and in marketing agencies, and ultimately help you win in 2025.
1. Why Your Marketing Budget Matters for 2025
A well-thought-out marketing budget is critical for growth-stage startups, particularly those on the cusp of major milestones like Series A or B funding. Not only are you challenged with proving that there is a market for what you’re offering, but you also have to prove that you can get traction with that market to really win the attention of investors. It’s a tall order, and one that takes attention and focus to navigate effectively.
The Role of Marketing in Startup Growth
Marketing serves as the bridge between your offering and target audiences. Effective marketing strategies can support major growth initiatives including:
- Increasing brand awareness and securing brand positioning
- Generating leads
- Converting prospects into loyal customers
For startups, establishing a strong market presence is essential to compete with established players and to demonstrate traction to potential investors.
Risks of Underinvestment in Marketing
Underinvesting in marketing (whether that be limited dollars OR an underinvestment in your time and focus) can lead to missed growth opportunities.
Without sufficient (yes, I said sufficient, not incredible or expert or top-of-the-line) marketing efforts, even superior products may fail to gain market traction. A study by CB Insights highlights that 14% of startup failures are due to poor marketing, underscoring the importance of adequate marketing investment.
In 2025, your marketing budget will need to account for evolving customer expectations, emerging technologies, and increasingly competitive digital channels. Newsflash–if you haven’t been thinking about the place of AI in 2025 and beyond, you are probably making a mistake. Ignoring these factors could leave you behind, while careful planning can position your startup as a market leader.
If you don’t have the time to stay on top of trends, you may need to consider allocating capital to specialists who do, or hiring someone to take that role in a more focused capacity.
Dangers of Overinvestment in Ineffective Marketing
Conversely, overinvesting in ineffective marketing channels can deplete your resources without yielding significant returns (and negatively impact your confidence and mindset, to boot). Being the founder of a marketing agency has put me on both sides of the table, and it can suck when you over-invest.
Ultimately, I lean into the age-old adage to “invest in what you understand.” If you need marketing results, be sure to partner with someone who will educate you about what “success” and “failure” look like, and how they plan to get there. Talk numbers. Talk reporting and analytics. If you have any misunderstandings, dig more. Anyone who knows their sh*t will be willing to talk to you about what their plans are until you feel knowledgeable and secure. And if they don’t know, and tell you they don’t know? That could also be a huge green flag. Someone willing to experiment and learn with you, not fudge the numbers, is a good person to have on your side.
It’s critical to allocate your marketing budget strategically, focusing on channels (social, email, radio?, etc.) that offer the highest ROI for your startup. And your budget does not have to be MASSIVE. A report by Gartner indicates that marketing budgets have dropped from an average of 9.1% of company revenue in 2023 to 7.7% in 2024, emphasizing the need for efficient budget allocation.
In summation: Work smarter, not harder.
2. Key Steps to Developing Your Marketing Budget
a. Assess Your Goals and Growth Stage
So you want to make an effective budget. Ok. Tell me honestly, and effectively: What are your goals? Are you focusing on building brand awareness, expanding your base audience, acquiring new paying customers, preparing for investor presentations? Some combination of a bunch of goals? Which are the most important? Can you rank them top to bottom?
Each goal requires different allocations to branding, website, and outbound marketing strategies.
For example, if customer acquisition is your top priority, you might allocate a larger portion of your budget to performance marketing channels like Google Ads or paid social campaigns.
Conversely, if you’re preparing for a funding round, you might prioritize branding, authority-building tactics like thought leadership and PR initiatives to solidify your market position.
Setting SMART (Specific, Measurable, Achievable, Relevant, and Time-bound) goals is critical here. A vague goal like “increase traffic” won’t guide your spending effectively, but a SMART goal like “increase website traffic by 50% by Q3 2025” will. This specificity ensures every dollar you spend is aligned with your objectives.
If you have a hard time figuring out your goals? Start small. Block out a 3-hour chunk of your quarter, and be sure to schedule a 30-minute call in that time with your mentor or advisors to settle this. Set THREE goals that make sense and feel good to you. Making decisions based on some goals is better than making decisions based on no goals, any day.
b. Understand Industry Benchmarks
I typically give the broad stroke recommendation to allocate 8-15% of your revenue to your marketing budget (lower if you’re B2B, higher if you’re D2C; lower if you’re more established in the market, higher if you’re newer to the scene).
However, if you want to drill down a little further and get a better sense of what’s working for others in your industry, I’d recommend doing some research to see what makes sense for your business.
Industry Benchmarks provide a valuable reference point when deciding how much to allocate to marketing. Industry standards vary, but here are some averages to consider from The CMO Survey released in September 2024:
When exploring industry benchmarks, connecting with mentors and advisors can help you sanity-check any figures you’ve uncovered through public research.
c. Guess what? Data helps. Audit Your Current Marketing Performance!
A detailed review of your 2024 marketing performance can be helpful to avoid repeating past mistakes. Start by identifying the channels and campaigns that delivered the highest ROI. For example, did your email marketing campaigns consistently drive conversions, while paid ads underperformed? Are you getting visits to your Blog page the way you’d hoped, or is your Chat Bot really getting all the glory on your website?
Tools like Google Analytics, HubSpot, your email management tool (like MailChimp or ActiveCampaign), your social media scheduling tool (like SproutSocial or Hootsuite), etc., can provide metrics on your marketing efforts. This audit isn’t just about spotting underperformers—it’s about identifying the strategies behind your successes, so you can scale smarter and more effectively.
As a bonus, this audit may reveal where you have missed opportunities to track KPIs for success, and you can fill in those gaps with tools moving forward. Key metrics to monitor, to support analysis of your marketing success or areas for improvement, include:
- Website Traffic: Are your efforts driving visitors?
- Engagement Rates: Are your social media posts generating likes, comments, and shares?
- Lead Generation: How many leads are coming from various channels or sources?
- Conversion Rates: Are your campaigns, communications, advertisements, etc., supporting conversion of prospects to paying customers?
By continuously analyzing these metrics and any additional KPIs that are important to your business goals, you can refine your strategy, focusing on what resonates most with your audience and brings the greatest impact.
d. Prioritize Your Channels and Strategies
Not every channel is created equal, and your 2025 budget should reflect this. High-ROI channels like SEO, email marketing, or paid ads often deliver the best bang for your buck. However, emerging trends like AI-powered personalization or community-building initiatives might warrant smaller experimental budgets.
For instance, if you’ve seen significant traction on LinkedIn, consider doubling down on organic and paid efforts there while deprioritizing platforms with less engagement (sayonara, X).
This approach ensures your budget supports what matters most to your growth goals.
3. Where to Spend in 2025: High-Impact Investments
a. Brand Building
Branding, branding, branding. I know the concept of branding can start to feel tired after a while, but I want to invite you to consider what a strong brand does for you and for the folks you’re trying to serve.
Branding includes (but is not limited to):
- Your logo
- Color story
- Type and Font usage
- Imagery selection and usage
- Brand messaging (such as your taglines, boilerplates, short and long descriptions, voice and tone, etc.)
I recommend investing in cohesive branding across all touchpoints, including your website, pitch decks, social media, event materials, and wherever you are in the public eye.
Investor-focused businesses: If you’re getting ready to pitch for your friends and family investor series or Series A and B funding rounds, pay special attention to your pitch deck and associated assets to create a cohesive, unified, and strong brand message. The smallest mistakes may make or break your chances of getting selected for investment.
b. Website and SEO
Your website isn’t just a digital storefront or brochure—it’s a 24/7 team member (ideally a high-powered business development rep) and a key touchpoint for potential investors. An optimized website not only engages your target audience but also reflects your company’s durability and scalability.
SEO is an important consideration alongside a website development strategy (yes, even with AI search on the rise in 2024 and poised to explode in 2025). Unlike paid advertising, which stops delivering results the moment you stop spending, SEO is a long-term investment. A well-executed SEO strategy can drive organic traffic for years while also reinforcing brand messaging to direct website visitors, making it a cornerstone of any growth-focused marketing plan.
c. Content Marketing
Ongoing marketing and the creation of high-value content for your audience is no longer a differentiator – it’s a necessity to create brand awareness and set you as an authority in the space. For growth-stage startups, content serves as a bridge between awareness and conversion, nurturing prospects through the customer journey while establishing your brand as a thought leader in your industry. Here’s how to make it work for you in 2025:
Create Evergreen and High-Conversion Content
Evergreen content has enduring value, remaining relevant long after it’s published. This can include:
- Long-Form Blog Posts: Well-researched, SEO-optimized articles that address pain points or answer key questions for your audience. Long-form content (1,500-2,000+ words) performs well in search rankings and drives organic traffic over time.
- Case Studies: Highlight successful projects or client results to demonstrate your product’s or service’s effectiveness. These are especially powerful for startups selling B2B solutions.
- Videos: Explainer videos, product demos, or customer testimonials that visually convey your value proposition.
- Downloadable Lead Magnets: Ebooks, whitepapers, or checklists that offer immediate, actionable value in exchange for contact information, helping build your email list.
By focusing on evergreen content, you create assets that continuously bring value to your audience and drive engagement for years to come. This long-term impact is especially beneficial for startups with lean marketing budgets.
The Value of Organic Social Media
It’s easy to think you have to pump cash into ads on social media to gain traction. But where paid ads are like a hose, organic content is like the rain. If you want to grow and nurture your audience, stay top of mind, and create lasting impressions, ongoing marketing practices that keep you in the public eye are essential. While paid social media campaigns have their place, organic efforts allow you to:
- Build Authentic Connections: Regular posts that highlight your company culture, milestones, or customer success stories help humanize your brand.
- Stay Top of Mind: Consistent posting keeps your audience engaged and reminds them of your expertise and solutions.
- Drive Traffic: Sharing blog posts, videos, and case studies on platforms like LinkedIn, Twitter, or Instagram directs followers to your website, where they can engage further with your brand.
- Support Community-Building: By engaging with followers through comments, polls, and user-generated content, you foster a sense of belonging among your audience.
Key Tip: Leverage platform-specific trends. For example, short-form videos (e.g., Reels or TikToks) can showcase your expertise in a digestible, shareable format, while LinkedIn articles or posts can position your startup as a thought leader.
The Power of Long-Form Blog Content
Long-form blog content deserves special attention. Google prioritizes in-depth, authoritative content, making it a cornerstone of any SEO strategy. But beyond search engine benefits, long-form blogs can:
- Answer Complex Questions: Blogs that dive deep into industry challenges or emerging trends position your company as a trusted resource.
- Place you at the top for AI Answers in Search Engines: AI search results give immediate answers where other search engine results leave breadcrumbs, making you the ultimate authority for regularly-asked questions.
- Capture Leads: Pair long-form content with CTAs (e.g., “Download this guide” or “Subscribe to our newsletter”) to convert readers into leads.
- Fuel Other Channels: Repurpose blog content into social media posts, email campaigns, or even snippets for paid ads. This maximizes your content’s ROI.
Consider developing cornerstone content pieces—comprehensive guides or resource hubs on key topics in your industry. These can serve as traffic drivers and lead generators, especially when linked to related articles or landing pages.
Email Marketing: Your Direct Line to Your Audience
Email marketing is one of the most effective tools for nurturing leads (yes, still), building relationships, and driving conversions. Unlike social media, where algorithms determine visibility, emails provide a direct, unfiltered connection to your audience.
Key email strategies include:
- Newsletters: Share a mix of updates, insights, and thought leadership to stay top of mind. For instance, updates on product developments, funding milestones, or new blog posts can keep your audience engaged.
- Drip Campaigns, also called Lead Nurturing Campaigns: Automate sequences to guide leads through the customer journey, from education to conversion.
- Event or Product Announcements: Emails are the perfect way to generate buzz around new product launches, partnerships, or funding rounds.
A regular email strategy helps maintain a dialogue with your audience while reinforcing your brand’s authority.
Two Sides of the Same Coin: Content Creation and Promotion
Creating high-quality content is just one part of the equation; getting it in front of the right audience is equally important. Consider whether it makes sense to allocate part of your budget for:
- Paid Content Promotion: Amplify your best-performing blogs, videos, or lead magnets through paid campaigns on social media or search engines.
- SEO Optimization: Invest in keyword research, on-page SEO, and link-building to ensure your content ranks well in search engines.
- Collaborations and Partnerships: Guest blogging, co-marketing campaigns, or influencer collaborations can expand your reach without relying solely on ads.
Promotion ensures your content doesn’t just exist—it works actively to drive traffic, engagement, and leads.
d. Paid Media and Retargeting
Paid media offers immediate results but requires careful execution to maximize ROI, as long as you’re focusing on data and staying plugged into the campaign. In 2025, consider:
- A/B testing: Use small audience samples to test messaging and creatives before scaling.
- Strategic retargeting: Re-engage users who’ve interacted with your brand but haven’t converted.
When deciding between social and search ads, let your goals guide you. Social ads excel at raising awareness, while search ads are better for capturing intent-driven traffic.
e. Marketing Tech Stack
Investing in the right tools can streamline your operations and improve efficiency. Key tools to consider include:
- CRM platforms: HubSpot or Salesforce for managing customer relationships.
- Automation tools: Mailchimp or ActiveCampaign for email automation, AI chatbots on your website for customer support automation, etc.
- Analytics tools: Google Analytics (free!), Google Search Console (also free!), and beyond for tracking performance and refining strategies.
Ultimately, your tech stack should be flexible. If you want to try something new, try it. If they try to lock you in and don’t offer ways to shift into new technology, recognize they are not operating in your best interest. There are a lot of options out there (and more coming out every day), but they should be making your life easier, not harder.
Also, be sure to check out the opportunity to secure lifetime deals or subscription deals from technology that you are in love with. If you like it, then you oughtta put a ring on it, basically.
4. Where to Save: Avoiding Wasted Investments
a. Over-reliance on Low-ROI Channels
This should come as no surprise, but I’m gonna say it anyway. Spreading your budget across too many channels can make it harder to see meaningful results and can leave your efforts feeling scattered. Instead, it’s better to focus on a few key platforms where your audience is most active and engaged.
For example, if Instagram hasn’t been performing well despite consistent effort, consider shifting that budget to something like LinkedIn or Google Ads, which might align better with your goals. If you think paying your uncle Ted to tell his friends about your business isn’t creating new contracts for you, tell Ted to get another job.
By concentrating your resources on what works best, you’ll build stronger momentum and get more value from your marketing efforts. This way, you’re making smarter investments rather than trying to be everywhere at once.
b. Unmeasured Experiments
While experimentation is vital, unmeasured experiments can waste time and money. Before launching a campaign, define clear KPIs and measurement frameworks to track success. Just track what you’re doing. It takes a little effort to set up, but creates amazing gains in the long run.
c. Oversized Agency Retainers Without Clear Deliverables
Ever heard a fellow founder bemoaning the wasted dollars with a marketing agency? We hear that pretty regularly, too.
Agencies can be a great resource, but unclear deliverables can lead to inefficiencies. Always align on goals and track ROI to ensure your investment is yielding tangible results.
This can be said of hiring in house as well, actually. If you’re hiring in-house marking support, be sure they know what success looks like! Reach out to me if you want to talk about creating a badass hiring process, BTW.
5. It’s Giving Flex: Building Flexibility into Your Budget
The best marketing plans are adaptable, giving you room to adjust as new opportunities or challenges arise. For 2025, it’s smart to set aside contingency funds so you can pivot quickly if needed.
Imagine an industry trend takes off mid-year—having some flexibility in your budget lets you jump in and make the most of the moment.
Regularly reviewing your marketing performance is also key, as it helps you spot areas where you can scale back or double down.
A little extra breathing room in your budget can make a big difference, allowing you to explore creative ideas or capitalize on unexpected wins. Flexibility doesn’t mean a lack of direction—it means being prepared to adapt in ways that keep your business moving forward.
Basically, if you can, put aside 1-5% of your cash to put toward big things (might as well put it in a high-yield savings account, while you’re at it). If you do this regularly, you’ll be ready to crush anything that comes at you, and take advantage of opportunities you can’t think of yet. Nor can we necessarily think of yet.
That being said, though, if you want to be kept in the loop on industry standards and opportunities, please subscribe to our newsletter. And let us know what you want to see there, because we’re improving it all the time.
Wrap-up
A well-planned marketing budget can help you scale your startup efficiently in 2025.
By focusing on high-impact investments, avoiding common pitfalls, and building flexibility into your plans, you can ensure your marketing dollars drive measurable growth.
Ready to craft a smarter marketing strategy for 2025? Talk to us! Talk to someone you trust. Talk to anybody. Seriously.
Our agency specializes in helping growth-stage startups by delivering tailored branding, websites, and ongoing marketing management to put more time back in your pocket. Contact us today!
