How much should a small business spend on advertising?

Industry benchmarks range from 2% of revenue (auto dealers) to 15% (SaaS), with most local-service businesses landing at 5–10%. The Step 1 advisor on this page applies an industry rate × business stage multiplier × growth-goal multiplier so the recommendation actually reflects whether you are launching (1.7×), growing (1.3×), established (1.0×), or mature (0.7×) — not a flat percentage.

Is the calculator really free?

Yes. No signup, no email gate, no trial. The calculator runs entirely in your browser. If you want us to review your plan and turn it into an actual launch, that conversation is also free — and the click is only there because plenty of visitors ask for it.

What channels does the calculator allocate across?

All 15 channels on our rate card: Search Engine Marketing (SEM), Meta / Social (Facebook + Instagram), LinkedIn Ads, TikTok, Snapchat, Targeted Display, Geo Fencing, GeoVideo, Pre-Roll Video, OTT (Over-the-Top), Connected TV (CTV), Streaming Audio, YouTube TrueView, Local Radio, and Email Marketing. You can also enter existing "Other" spend (billboards, print, an agency retainer) so the channel-mix math accounts for it instead of competing against it.

Where do the rate-card numbers come from?

Real Haugo Digital programmatic rate-card minimums and CPMs — not industry averages or theoretical pricing. Radio rates start at $350/mo for entry-level local schedules and $650+/mo for a 52-week long-term plan. Channel effectiveness ordering is anchored on Nielsen, Westwood One, Foursquare, eMarketer, and IAB studies (every figure is sourced on the references page).

Can I save or share the plan?

Yes. The "Get this plan reviewed" button at the bottom of the calculator sends the exact plan you built — channel split, dollar allocation, year-one totals, optional video creative production — straight to us. You do not have to retype anything. You can also screenshot the calculator and email it yourself; the URL is shareable.

Does the calculator work for businesses outside Rapid City and the Black Hills?

Yes. The four region tiers — Local, Area, Region, and DMA (your local TV/media market, resolved when you set a city) — adjust the channel mix and audience scale to fit any U.S. market. Digital channels (search, social, display, geofencing, CTV/OTT, audio, YouTube, email) work anywhere. Radio is the only channel that is location-specific to the Black Hills audiences we cover.

How is this different from agency proposals or "marketing budget" rules of thumb?

Agency proposals usually anchor on what the agency wants to sell. "Spend 5–10% of revenue" is a rule of thumb, not a plan. This calculator works backwards from your business stage and goal, then forwards into a specific channel split with real rate-card minimums — so you see exactly what a 5-channel plan costs at a given budget, what channels lock until your budget grows, and what production costs (one-time video creative) actually run.

Is advertising tax-deductible?

Yes — advertising is "ordinary and necessary" business expense under IRC §162 and IRS Publication 334, fully deductible in the year incurred. Unlike a vehicle (5-year depreciation) or equipment (7+ year depreciation), advertising deducts in full immediately. The tax callout on the calculator page links the underlying statute and FASB ASC 720-35 accounting standard if you need it for your CPA.

What percentage of revenue should go to advertising?

It depends on the industry and the stage, which is exactly why a single percentage is the wrong answer. Home services and real-estate brokerages sit around 10% of revenue, retail around 9%, healthcare and B2B services around 5%, restaurants around 4%, auto dealers around 2%, and SaaS as high as 15%. Then the stage multiplier moves it: a launching business runs 1.7× the baseline, a growing one 1.3×, an established one 1.0×, and a mature one 0.7×. A growing home-services company at $750,000 revenue lands at roughly $8,150 a month — 13% of revenue, not 10%.

What is the difference between a marketing budget and an advertising budget?

This is the distinction most budget calculators quietly skip, and it is the one that gets businesses in trouble. Your marketing budget also pays for the website, the CRM and email tools, the staff time, and any outside help. Only a slice of it actually buys ads. Gartner puts paid media at about 30.6% of an enterprise marketing budget; strip out the enterprise in-house-labour line a small business does not carry, and the slice works out to roughly 39% — a little more for consumer-facing businesses, a little less for B2B. So a $8,150 monthly marketing budget is closer to $3,600 of actual ad spend. That paid-media number, not the marketing number, is what the channel planner sizes against.

How much should I spend on advertising to make a specific amount of revenue?

Work it forwards, not backwards. Size the budget from your revenue, industry, and stage; build the channel mix that budget can actually afford; then value that mix at published ROAS benchmarks to see the range it could return. The worked examples on this page run all three stages end to end. Be careful reading the last number as a promise, though — a projected return is your mix valued at other advertisers' median results, not a forecast of your revenue.

How much should a small business spend on advertising?

Industry benchmarks range from 2% of revenue (auto dealers) to 15% (SaaS), with most local-service businesses landing at 5–10%. The Step 1 advisor on this page applies an industry rate × business stage multiplier × growth-goal multiplier so the recommendation actually reflects whether you are launching (1.7×), growing (1.3×), established (1.0×), or mature (0.7×) — not a flat percentage.

Is the calculator really free?

Yes. No signup, no email gate, no trial. The calculator runs entirely in your browser. If you want us to review your plan and turn it into an actual launch, that conversation is also free — and the click is only there because plenty of visitors ask for it.

What channels does the calculator allocate across?

All 15 channels on our rate card: Search Engine Marketing (SEM), Meta / Social (Facebook + Instagram), LinkedIn Ads, TikTok, Snapchat, Targeted Display, Geo Fencing, GeoVideo, Pre-Roll Video, OTT (Over-the-Top), Connected TV (CTV), Streaming Audio, YouTube TrueView, Local Radio, and Email Marketing. You can also enter existing "Other" spend (billboards, print, an agency retainer) so the channel-mix math accounts for it instead of competing against it.

Where do the rate-card numbers come from?

Real Haugo Digital programmatic rate-card minimums and CPMs — not industry averages or theoretical pricing. Radio rates start at $350/mo for entry-level local schedules and $650+/mo for a 52-week long-term plan. Channel effectiveness ordering is anchored on Nielsen, Westwood One, Foursquare, eMarketer, and IAB studies (every figure is sourced on the references page).

Can I save or share the plan?

Yes. The "Get this plan reviewed" button at the bottom of the calculator sends the exact plan you built — channel split, dollar allocation, year-one totals, optional video creative production — straight to us. You do not have to retype anything. You can also screenshot the calculator and email it yourself; the URL is shareable.

Does the calculator work for businesses outside Rapid City and the Black Hills?

Yes. The four region tiers — Local, Area, Region, and DMA (your local TV/media market, resolved when you set a city) — adjust the channel mix and audience scale to fit any U.S. market. Digital channels (search, social, display, geofencing, CTV/OTT, audio, YouTube, email) work anywhere. Radio is the only channel that is location-specific to the Black Hills audiences we cover.

How is this different from agency proposals or "marketing budget" rules of thumb?

Agency proposals usually anchor on what the agency wants to sell. "Spend 5–10% of revenue" is a rule of thumb, not a plan. This calculator works backwards from your business stage and goal, then forwards into a specific channel split with real rate-card minimums — so you see exactly what a 5-channel plan costs at a given budget, what channels lock until your budget grows, and what production costs (one-time video creative) actually run.

Is advertising tax-deductible?

Yes — advertising is "ordinary and necessary" business expense under IRC §162 and IRS Publication 334, fully deductible in the year incurred. Unlike a vehicle (5-year depreciation) or equipment (7+ year depreciation), advertising deducts in full immediately. The tax callout on the calculator page links the underlying statute and FASB ASC 720-35 accounting standard if you need it for your CPA.

What percentage of revenue should go to advertising?

It depends on the industry and the stage, which is exactly why a single percentage is the wrong answer. Home services and real-estate brokerages sit around 10% of revenue, retail around 9%, healthcare and B2B services around 5%, restaurants around 4%, auto dealers around 2%, and SaaS as high as 15%. Then the stage multiplier moves it: a launching business runs 1.7× the baseline, a growing one 1.3×, an established one 1.0×, and a mature one 0.7×. A growing home-services company at $750,000 revenue lands at roughly $8,150 a month — 13% of revenue, not 10%.

What is the difference between a marketing budget and an advertising budget?

This is the distinction most budget calculators quietly skip, and it is the one that gets businesses in trouble. Your marketing budget also pays for the website, the CRM and email tools, the staff time, and any outside help. Only a slice of it actually buys ads. Gartner puts paid media at about 30.6% of an enterprise marketing budget; strip out the enterprise in-house-labour line a small business does not carry, and the slice works out to roughly 39% — a little more for consumer-facing businesses, a little less for B2B. So a $8,150 monthly marketing budget is closer to $3,600 of actual ad spend. That paid-media number, not the marketing number, is what the channel planner sizes against.

How much should I spend on advertising to make a specific amount of revenue?

Work it forwards, not backwards. Size the budget from your revenue, industry, and stage; build the channel mix that budget can actually afford; then value that mix at published ROAS benchmarks to see the range it could return. The worked examples on this page run all three stages end to end. Be careful reading the last number as a promise, though — a projected return is your mix valued at other advertisers' median results, not a forecast of your revenue.

Free tool · No signup

Advertising Budget Calculator — free media mix planner.

How much should you spend on advertising — and how should you split it across channels? Tell us your revenue and goals, and get a recommended monthly budget and a real channel mix across all 15 channels: Search, Meta, LinkedIn, TikTok, Snapchat, Display, Geofencing, Geo Video, Pre-Roll Video, OTT, CTV, Streaming Audio, YouTube, Radio, and Email. Real rate-card pricing. No signup. No email gate.

Start the calculator ↓Talk to a specialist instead

Used by small businesses sizing their first paid plan and by marketing managers stress-testing their current spend. Every channel-effectiveness figure is sourced.

Step 1 · Sizing

How much should you spend on advertising?

The 5–10% rule of thumb is too generic. The advisor below applies an industry-specific advertising-to-revenue rate, multiplied by your business stage (launching businesses spend more aggressively to build awareness before search demand exists) and your growth goal (aggressive growth requires above-baseline acquisition spend). The output is a realistic monthly range, not a flat percentage.

Step 2 · Allocation

Channel-mix calculator with real rate-card pricing.

15 channels, real CPMs and minimum monthly spends from the Haugo Digital programmatic rate card. Choose your goal — leads, foot traffic, awareness, or recruiting — and your region tier. The calculator allocates by channel effectiveness for that goal (anchored on Nielsen, Westwood One, Foursquare, eMarketer, and IAB performance data), shows you which channels lock at your budget, and computes year-one media plus optional one-time video creative production.

Step 1 · Budget Size Advisor

What should I spend?

City, State

Sets the local / regional radius and audience size for the channel-mix calculator below.

Annual revenue

Last 12 months · approximate

Industry

Baseline: 10% of revenue · source

Home Services type

Stage

Goal

Your marketing budget — Home services / contractors

$4,600 to $6,250/mo

10% baseline (SBA / Gartner industry %) × 1.30× (Growing) × 1.00× (Steady) = 13.0% of revenue/year · $65,000/yr annualized.

Your advertising / media budget

$2,400/mo

Home services / contractors businesses put roughly 44% of a marketing budget into paid media (Gartner CMO Spend Survey). That is the number we plan across the channels below.

The 44% above is specific to home services / contractors — that is why the plan sizes against it rather than a flat cross-industry average. The share is per-industry because the whole budget mix differs by industry.

Where the other 56% of the marketing budget goes

With 44% going to paid media, the other 56% of a home services / contractors marketing budget funds the work that makes the ads convert (Gartner CMO Spend Survey):

19.3%Marketing technology & tools — website & hosting, CRM, email platform, analytics, SEO and scheduling software.
18.9%In-house staff & your time — planning, creating, and running the marketing.
17.8%Agencies & outside help — designers, copywriters, video, web and SEO specialists.

These four lines are one budget. Gartner publishes a single cross-industry split of the non-media money (22.4 / 21.9 / 20.7). We hold those proportions exactly and scale them to the 56% that is actually left after your industry’s 44% media share — so the numbers add up to your budget rather than to a cross-industry average. There is no published per-industry breakdown of the non-media money, so we do not invent one.

The mix moves by industry. B2B and relationship-led businesses put more into tools, content, and outside expertise for longer sales cycles — and less into media (34%). Consumer-facing businesses lean harder into media and brand (44%). Home services / contractors sits at 44% — which is why every figure in this block is sized to that.

If you are a small local business, you carry less formal marketing payroll than the enterprises Gartner surveyed — so more of your non-media budget goes to tools, website and creative, and outside help, and less to salaried staff.

The media number is the slice that buys the ads; the rest funds the website, tools, content, and people that make those ads work.

3–7 years in, actively scaling

Plans your media budget below

Industry baselines anchored on SBA + Gartner + Deloitte CMO surveys · Stage and growth multipliers from established growth-stage theory · Adjust budget manually anytime

Step 2 · Campaign Planner

Real rate card · Recalculates live

Monthly budget

$350$25K$50K$100K

Click the dollar amount to type any budget · Slider visualizes $350–$100K (no upper cap on typed budgets)

Primary goal

Where you serve customers

Service radius

Set your city to use the radius slider · Populations come from real US Census data

Do you have video creative ready?

Your plan doesn't currently include a video channel, so there's no video budget to redirect. Add Pre-Roll Video, CTV, OTT, GeoVideo, or YouTube from Add another channel below to include video — production scope options appear once a video channel is in the plan.

How this worksChannels are selected by an industry-specific playbook calibrated to your goal and budget. Each channel plays a defined role — Anchor drives the core campaign performance for your industry; Reinforcement strengthens brand recall across additional touchpoints; Discovery expands reach to new audiences when budget supports it; Brand Defense protects branded search at higher tiers. Budget distributes across roles per documented role percentages for your tier (e.g., 70% Anchor / 20% Reinforcement / 10% Discovery at Growth tier), then within each role across the channels ranked most effective in that role for your industry — anchor by playbook fit, reinforcement by retargeting strength, discovery by reach & attention — with budget shifting toward supporting roles only as a channel approaches its saturation point. Vendor minimums are honored — channels can't fund below contract floors, and channels that would land below floor are dropped with their share redistributed to a viable channel in the same role. Campaign management & monthly reporting are included in each channel rate — no carve-out. Digital rates from the Haugo Digital card. Radio is flexible: entry-level monthly schedules from $350/mo, 1-day event sponsorships from $100/day, and long-term 52-week plans starting at $650/mo (see radio plans for the tier breakdown). SEM & Social need a 3-month commit; radio plans a 60-day cancellation. Local radio runs across the four Black Hills stations (KICK 104, KSKY, HITS 102.7, ESPN Rapid City); Regional radio runs 95.1 KSKY specifically (250-mile signal radius — matches the Regional footprint). Geofencing/Geo Video work at Local and Natl-Local. Video creative production is a separate one-time cost — only added if you don't already have a commercial ready.

Plan-level guidance follows the published evidence base: the mix is scored for its brand-building vs sales-activation balance (IPA effectiveness research — Binet & Field), and per-channel frequency guidance is cap-based (sourced fatigue ceilings, not minimum-exposure floors). Channel effectiveness ordering is based on published industry data (Nielsen, eMarketer, Foursquare, Westwood One, IAB, and others). View all data sources & citations →

Active channels

Total monthly impressions

—

People reached

Plan tier

Foundation

Frequency thresholds — see cited sources →

Recommended monthly mix% of $2,500

intent-driven (frequency N/A)

3-mo commit

100%

—

Management & reporting included · No carve-out

Add another channelReallocates automatically

Min $2,000/mo · $18 CPM

Min $2,000/mo · $44 CPM

Min $2,000/mo · $13 CPM

Min $2,000/mo · $12 CPM

Min $600/mo · $12 CPM

Min $600/mo · $20 CPM

Min $540/mo · $18 CPM

Min $750/mo · $25 CPM

Min $1,500/mo · $50 CPM

Min $798/mo · $38 CPM

Min $2,000/mo · $0.24 CPV

Min $350/mo · $15 CPM

Min $1,000/mo · $25 CPM

Amount:$/mo

Monthly media

$2,500

Year-one media

$30,000

Video production

Not needed

Step 3 · Review & launch

This plan is built on real rate cards — every number traces to a source. Send the configuration and we'll come back with a tuned plan for your market.

Get this plan reviewed & launched →

Worked examples · Step 1

How much should a business spend on advertising? Ten real answers.

Every figure below is the output of the same budget-size model the tool above runs — five industries at two business stages, computed when this page was built. The revenues are example inputs; everything downstream of them is the model.

The two numbers, and why they are not the same

Your marketing budget is not your ad budget. The marketing budget also pays for the website, the tools, the staff time and any outside help. Only a slice of it actually buys ads — and it is that slice, not the headline number, that the channel planner sizes against. Nearly every other budget calculator hands you the marketing number and lets you assume it all goes to media. That is how a business ends up planning a $8,000 media buy on a $3,600 media budget.

The arithmetic: revenue × industry rate × stage multiplier = marketing budget; marketing budget × paid-media share = ad budget. Industry rates are anchored on the SBA and the Gartner / Deloitte CMO surveys; the stage multipliers (launching 1.7×, growing 1.3×, established 1.0×, mature 0.7×) sit inside the ranges published by HBR and McKinsey.

One honest caveat. The paid-media share (44% consumer-facing / 39% baseline / 34% B2B) is derived, not directly published. Gartner’s paid-media share renormalised to strip the enterprise in-house-labour line an SMB does not carry gives the ~39% baseline, and the consumer-vs-B2B direction is sourced — but the exact tier values are researched estimates, held to a deliberately tight spread. No per-industry dataset for this exists. The derivation is on the references page, and we would rather show you the seam than hide it.

Recommended advertising budget by industry and business stage — generated by the budget-size model
Industry	Stage	Example revenue	Rate × stage	Marketing budget	Ad budget
Home services (HVAC, plumbing, roofing)	Growing	$750,000	10% × 1.3×	$8,150/mo	$3,600/mo
Home services (HVAC, plumbing, roofing)	Established	$750,000	10% × 1×	$6,250/mo	$2,750/mo
Restaurants & bars	Growing	$1,200,000	4% × 1.3×	$5,200/mo	$2,300/mo
Restaurants & bars	Established	$1,200,000	4% × 1×	$4,000/mo	$1,750/mo
Healthcare & clinics	Growing	$2,000,000	5% × 1.3×	$10,850/mo	$4,250/mo
Healthcare & clinics	Established	$2,000,000	5% × 1×	$8,350/mo	$3,250/mo
B2B services	Growing	$1,500,000	5% × 1.3×	$8,150/mo	$2,750/mo
B2B services	Established	$1,500,000	5% × 1×	$6,250/mo	$2,150/mo
Manufacturing & industrial	Growing	$5,000,000	3% × 1.3×	$16,250/mo	$5,550/mo
Manufacturing & industrial	Established	$5,000,000	3% × 1×	$12,500/mo	$4,250/mo

The ad-budget column carries a ±15% planning range around each figure — for the growing home-services contractor, $3,050–$4,100 a month. Run the tool above for your own revenue, industry and stage.

The whole pipeline

Revenue in, plan out — the three tools, end to end.

The three calculators are one pipeline. Revenue sizes the budget; the budget buys a mix; the mix implies a return. Below, two businesses run all the way through it. Each stage’s output is literally the next stage’s input — nothing is retyped between them, so the chain cannot quietly disagree with itself.

They are deliberately a small business and a larger one, because the contrast is the most useful thing here: the contractor’s budget concentrates into one channel, and the clinic group’s widens across five. Neither is the tool malfunctioning. At $3,600 a month, spreading across five channels buys a presence too thin to be noticed in any of them.

Home services (HVAC, plumbing, roofing) · Leads / calls · Growing · Rapid City, SD

Stage 1 — the budget · advertising budget calculator

$750,000 annual revenue × 10% industry rate × 1.3× growing stage = $8,150/mo marketing budget. Of that, 44% is paid media — $3,600/mo actually buys ads. That is the number the planner gets.

Stage 2 — the mix · media mix calculator

The planner takes that $3,600 and returns a Growth plan across 1 channel:

Recommended monthly media mix — Home services (HVAC, plumbing, roofing), Leads / calls, $3,600/mo, Rapid City, SD
Channel	Monthly spend	Share	Sourced ROAS
SEM	$3,600	100%	3.15–3.64×
Total	$3,600	100%

The mix totals $3,600 — exactly the budget Stage 1 derived. One channel, because at this budget concentration beats spreading below the vendor minimums.

Stage 3 — the projected return · advertising ROI calculator

Valuing that exact mix at its published ROAS benchmarks gives a blended 3.15×–3.64× — an estimated $11,340–$13,104 a month, or $136,080–$157,248 over a year.

Read this one carefully. The budget and the mix are facts about the plan. This last number is an estimate: the mix valued at published median ROAS benchmarks — results other advertisers reported, not a forecast of yours. It is revenue, not profit, and your margin comes out of it.

Healthcare & clinics · Awareness · Growing · Rapid City, SD

Stage 1 — the budget · advertising budget calculator

$6,000,000 annual revenue × 5% industry rate × 1.3× growing stage = $32,500/mo marketing budget. Of that, 39% is paid media — $12,700/mo actually buys ads. That is the number the planner gets.

Stage 2 — the mix · media mix calculator

The planner takes that $12,700 and returns a Scale plan across 5 channels:

Recommended monthly media mix — Healthcare & clinics, Awareness, $12,700/mo, Rapid City, SD
Channel	Monthly spend	Share	Sourced ROAS
CTV	$4,850	38%	2–4×gen.
Pre-Roll Video	$3,785	30%	2–4×gen.
Local Radio	$1,500	12%	2–4×gen.
SEM	$1,369	11%	3.15–3.64×
Display	$1,196	9%	2–4×gen.
Total	$12,700	100%

The mix totals $12,700 — exactly the budget Stage 1 derived. Five channels, because at this budget the leaders begin to saturate and the next dollar is worth more elsewhere.

Stage 3 — the projected return · advertising ROI calculator

Valuing that exact mix at its published ROAS benchmarks gives a blended 2.12×–3.96× — an estimated $26,974–$50,307 a month, or $323,688–$603,684 over a year.

The three tools

Advertising budget calculator — revenue → budget. You are on it.
Media mix calculator — budget → the channel-by-channel split, with 20 worked examples.
Advertising ROI calculator — mix → what it could return, estimated from published benchmarks.

Why this calculator

It is not just a percentage estimator.

Two-stage flow

Most calculators answer either “what should I spend?” or “where should it go?” This one answers both, in order, with the budget output of Step 1 feeding directly into Step 2.

Real rate-card pricing

Real CPMs and minimums — not theoretical numbers. SEM and social have 3-month commits. CTV starts at $1,500/mo. Radio starts at $350/mo. Video creative production is an additional cost that is NOT included in the calculator's monthly media budget — quotes come from a production partner and vary based on your advertising goals, project scope, locations, crew, and creative complexity.

Goal × region matrix

Sixteen distinct channel priority orderings — four goals × four region tiers — backed by Nielsen, Foursquare, Westwood One, eMarketer, and IAB performance data. A foot-traffic plan in a local market does not look like a lead-gen plan at national scale, and the calculator reflects that.

Radio + digital, integrated

Most agency calculators ignore radio. This one integrates Local Radio at $350/mo into the same channel-mix math — useful because radio + digital pairings outperform either alone in Nielsen MMM analysis (radio delivers an incremental 20–24% reach lift on top of TV-only plans).

Every effectiveness figure on the calculator and on this page is sourced on the references page — direct links to Nielsen Insights, Westwood One blog posts, the Krugman 1972 effective-frequency paper, IRC §162, IRS Publication 334, FASB ASC 720-35, and the Schmidt & Eisend 2015 meta-analysis.

How to use it

Five steps. About three minutes.

1
Tell the advisor about your business
Enter your annual revenue (or the revenue you are targeting), your industry, your business stage (launching / growing / established / mature), and your growth goal (maintain / steady / aggressive / major expansion). The advisor multiplies an industry-specific advertising-to-revenue rate by stage and growth multipliers to recommend a realistic monthly budget range — not a flat percentage.
2
Hand off to the channel-mix calculator
Click "Apply" to send the recommended monthly budget to the channel-mix calculator below. Choose your primary goal (leads, foot traffic, awareness, or recruiting) and region tier (Local, Area, Region, or DMA).
3
Review the recommended channel mix
The calculator allocates your monthly budget across the channels that are most effective for your goal and region — Search, Meta, LinkedIn, TikTok, Snapchat, Display, Geofencing, Geo Video, Pre-Roll Video, OTT, CTV, Streaming Audio, YouTube, Radio, and Email. Channels that do not fit at your budget show as locked, with the minimum spend needed to unlock them.
4
Adjust and lock in your plan
Add or remove channels manually. Enter existing "Other" spend (billboards, print, an agency retainer) so it is recognized but not competing. Toggle video creative production if you do not already have a commercial. The year-one media total and optional production cost update live.
5
Get the plan reviewed (optional)
Click "Get this plan reviewed" at the bottom of the calculator to send the exact plan to an advertising specialist for confirmation, refinement, and launch — no retyping. Reply turnaround is typically same day.

Start over from Step 1 ↑Jump back to Step 2 ↑

Industries we work with

The calculator covers 16 industries.

Step 1 above includes industry-specific advertising-to-revenue rates for restaurants, home services and contractors, auto dealers, healthcare, real estate agents and brokerages, retail, addiction recovery, legal, financial, B2B services, B2C services, SaaS, nonprofits, tourism, and manufacturing. See how we approach each industry →

FAQ

Calculator questions, answered.

How much should a small business spend on advertising?: Industry benchmarks range from 2% of revenue (auto dealers) to 15% (SaaS), with most local-service businesses landing at 5–10%. The Step 1 advisor on this page applies an industry rate × business stage multiplier × growth-goal multiplier so the recommendation actually reflects whether you are launching (1.7×), growing (1.3×), established (1.0×), or mature (0.7×) — not a flat percentage.
Is the calculator really free?: Yes. No signup, no email gate, no trial. The calculator runs entirely in your browser. If you want us to review your plan and turn it into an actual launch, that conversation is also free — and the click is only there because plenty of visitors ask for it.
What channels does the calculator allocate across?: All 15 channels on our rate card: Search Engine Marketing (SEM), Meta / Social (Facebook + Instagram), LinkedIn Ads, TikTok, Snapchat, Targeted Display, Geo Fencing, GeoVideo, Pre-Roll Video, OTT (Over-the-Top), Connected TV (CTV), Streaming Audio, YouTube TrueView, Local Radio, and Email Marketing. You can also enter existing "Other" spend (billboards, print, an agency retainer) so the channel-mix math accounts for it instead of competing against it.
Where do the rate-card numbers come from?: Real Haugo Digital programmatic rate-card minimums and CPMs — not industry averages or theoretical pricing. Radio rates start at $350/mo for entry-level local schedules and $650+/mo for a 52-week long-term plan. Channel effectiveness ordering is anchored on Nielsen, Westwood One, Foursquare, eMarketer, and IAB studies (every figure is sourced on the references page).
Can I save or share the plan?: Yes. The "Get this plan reviewed" button at the bottom of the calculator sends the exact plan you built — channel split, dollar allocation, year-one totals, optional video creative production — straight to us. You do not have to retype anything. You can also screenshot the calculator and email it yourself; the URL is shareable.
Does the calculator work for businesses outside Rapid City and the Black Hills?: Yes. The four region tiers — Local, Area, Region, and DMA (your local TV/media market, resolved when you set a city) — adjust the channel mix and audience scale to fit any U.S. market. Digital channels (search, social, display, geofencing, CTV/OTT, audio, YouTube, email) work anywhere. Radio is the only channel that is location-specific to the Black Hills audiences we cover.
How is this different from agency proposals or "marketing budget" rules of thumb?: Agency proposals usually anchor on what the agency wants to sell. "Spend 5–10% of revenue" is a rule of thumb, not a plan. This calculator works backwards from your business stage and goal, then forwards into a specific channel split with real rate-card minimums — so you see exactly what a 5-channel plan costs at a given budget, what channels lock until your budget grows, and what production costs (one-time video creative) actually run.
Is advertising tax-deductible?: Yes — advertising is "ordinary and necessary" business expense under IRC §162 and IRS Publication 334, fully deductible in the year incurred. Unlike a vehicle (5-year depreciation) or equipment (7+ year depreciation), advertising deducts in full immediately. The tax callout on the calculator page links the underlying statute and FASB ASC 720-35 accounting standard if you need it for your CPA.
What percentage of revenue should go to advertising?: It depends on the industry and the stage, which is exactly why a single percentage is the wrong answer. Home services and real-estate brokerages sit around 10% of revenue, retail around 9%, healthcare and B2B services around 5%, restaurants around 4%, auto dealers around 2%, and SaaS as high as 15%. Then the stage multiplier moves it: a launching business runs 1.7× the baseline, a growing one 1.3×, an established one 1.0×, and a mature one 0.7×. A growing home-services company at $750,000 revenue lands at roughly $8,150 a month — 13% of revenue, not 10%.
What is the difference between a marketing budget and an advertising budget?: This is the distinction most budget calculators quietly skip, and it is the one that gets businesses in trouble. Your marketing budget also pays for the website, the CRM and email tools, the staff time, and any outside help. Only a slice of it actually buys ads. Gartner puts paid media at about 30.6% of an enterprise marketing budget; strip out the enterprise in-house-labour line a small business does not carry, and the slice works out to roughly 39% — a little more for consumer-facing businesses, a little less for B2B. So a $8,150 monthly marketing budget is closer to $3,600 of actual ad spend. That paid-media number, not the marketing number, is what the channel planner sizes against.
How much should I spend on advertising to make a specific amount of revenue?: Work it forwards, not backwards. Size the budget from your revenue, industry, and stage; build the channel mix that budget can actually afford; then value that mix at published ROAS benchmarks to see the range it could return. The worked examples on this page run all three stages end to end. Be careful reading the last number as a promise, though — a projected return is your mix valued at other advertisers' median results, not a forecast of your revenue.

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The Advertising Budget Calculator, calculator interface, source code, written content, formula documentation, and implementation logic are owned by Jarrett Phillips, owner of Local Advertising & Marketing. This tool may not be copied, reproduced, scraped, republished, or used to create derivative tools without written permission.