Founders ask me the same question again and again: what percentage of revenue should we spend on marketing? The internet offers confident answers, and they do not agree. That is not because someone is wrong. It is because the surveys behind those numbers ask different people about different things. Below I lay out the three figures most often quoted, what each actually measures, why none of them fits a $1M to $15M ARR company in India or the US out of the box, and the method I use instead: build the budget up from the pipeline you need and the payback you can afford, then use the benchmarks only as a cross-check.
Three widely quoted numbers, three different answers
Gartner's 2025 CMO Spend Survey reported that marketing budgets held flat at 7.7% of overall company revenue, the same as the year before. Marketing Brew's coverage of that survey notes it covered about 400 CMOs and marketing leaders in North America, the UK and Europe, largely at companies with more than $1 billion in annual revenue, and that paid media took about 31% of the budget. The CMO Survey, run out of Duke's Fuqua School of Business with Deloitte and the American Marketing Association, reported a higher figure in its Spring 2025 edition: marketing spending at 9.4% of total company revenue, up from 7.7% in Spring 2024, based on 281 marketing leaders at US for-profit companies (CustomerThink's summary of that edition gives the sample details). SaaS Capital's 2026 spending benchmarks, from a survey of more than 1,000 private B2B SaaS companies, put median marketing spend at 8% of ARR and median sales spend at 15% of ARR. Three credible sources, three numbers between 7.7% and 9.4%. The spread looks small until you notice how differently each was produced, which is the next point.
Why the figures disagree: base, sample and scope
First, the base. Gartner and the CMO Survey express marketing as a share of revenue. SaaS Capital reports it as a share of ARR, even though its survey question asked about percentage of revenue, and the post does not explain the difference. For a growing subscription business, ARR and recognised revenue can differ by a lot. Second, the sample. Gartner's respondents are mostly billion-dollar companies across all industries. The CMO Survey covers US companies of mixed size and sector. Only SaaS Capital is close to the company most of my readers run: private, B2B, subscription. Third, scope. 'Marketing budget' can mean programme spend only, or programme spend plus salaries, agencies and tools. SaaS Capital's page does not define what its marketing line includes, and Gartner's figure is a budget reported by the CMO, which may exclude marketing headcount sitting elsewhere. Fourth, marketing versus sales and marketing. Many blog posts quote a combined sales and marketing figure next to a marketing-only figure as if they were the same thing. They are not. Before you compare yourself to any number, check those four things.
What changes by stage between $1M and $15M ARR
The most stage-specific public figure I found is in SaaS Capital's 2026 benchmarks, which give the $3M to $5M ARR band as 8% of ARR on marketing and 12% on sales. Other bands appear only as a chart, so I will not quote them. Beyond that, I would rather describe the shape than invent precision. Below roughly $1M to $3M ARR, much of the marketing cost is people (often the founder's own time) and experiments, so a percentage of a small revenue base tells you very little; a fixed experimental budget with clear kill rules is more useful. Between $3M and $10M, the question shifts to whether you have one or two channels with known payback that can absorb more money, and the budget should grow only as fast as those channels prove they can. Toward $10M to $15M, layers that do not pay back inside a quarter, such as brand, product marketing and events, start to earn a place, and the percentage typically matters more to the board because it now drives burn. If you are post-raise, my piece on where funded startups waste the first $120K covers the sequencing mistakes in detail.
India versus the US: do not import a percentage
All three surveys above are dominated by US, UK and European respondents. I could not find an independent, India-specific benchmark for marketing spend as a percentage of revenue that I would put in front of a board; what exists is mostly agency estimates without published methodology. That matters for two reasons. First, the cost structure is different. Salaries, agency fees and media prices in India do not scale in the same proportions as US costs, so the same percentage of revenue buys a very different mix of people and media. Second, many Indian SaaS companies sell to US customers while carrying an India cost base, which makes a revenue percentage even less comparable. My advice for Indian founders: build the budget in rupees from your own CAC, pipeline conversion and payback, and treat US percentages as a loose upper and lower bound, not a target. For US companies with an India team, do the same in reverse. If you need channel-level cost references for India, my benchmarks on Google Ads CPC and Meta CPL in India are a better input than any percentage.
A practical way to set the budget
Here is the method I use, in order. 1. Start from the new ARR target for the year, not from last year's spend. 2. Decide what share of that new ARR marketing is expected to source, agreed with sales, and convert it into the number of won deals using your average contract value. 3. Work backwards through your own stage conversion rates (won from opportunity, opportunity from qualified lead) to the qualified pipeline needed, and from there to the leads or demos needed per channel. 4. Price each channel using your actual cost per qualified opportunity from the last two quarters, not a vendor benchmark. 5. Add the fixed layer: marketing salaries, agencies, tools and content. 6. Divide total marketing spend by expected marketing-sourced new customers to get CAC, then check CAC payback on a gross-margin basis. If payback is beyond what your cash and investors can tolerate, change the plan, not the assumptions. 7. Only now compare the total to revenue and to the surveys above. The marketing budget calculator and CAC payback period matrix on this site do steps 3 to 6 quickly.
Sources
Gartner, 2025 CMO Spend Survey press release (12 May 2025): https://www.gartner.com/en/newsroom/press-releases/2025-05-12-gartner-2025-cmo-spend-survey-reveals-marketing-budgets-have-flatlined-at-seven-percent-of-overall-company-revenue Marketing Brew, coverage of the Gartner 2025 CMO Spend Survey (sample, regions, paid media share): https://marketingbrew.com/stories/2025/05/20/marketing-budgets-gartner-cmo-report The CMO Survey, results archive: https://cmosurvey.org/results/ CustomerThink, research round-up of the Spring 2025 CMO Survey (9.4% figure and sample): https://customerthink.com/research-round-up-the-latest-edition-of-the-cmo-survey-and-a-new-survey-by-emarketer/ SaaS Capital, 2026 spending benchmarks for private B2B SaaS companies: https://www.saas-capital.com/blog-posts/spending-benchmarks-for-private-b2b-saas-companies/
FAQ
Published figures cluster between roughly 7.7% (Gartner, mostly large companies) and 9.4% (The CMO Survey, Spring 2025), with SaaS Capital reporting a median of 8% of ARR for private B2B SaaS. Use these as a cross-check only; set the budget from your pipeline target and CAC payback.
It depends on the source, and several surveys do not say. When you compare yourself to a benchmark, state whether your figure includes salaries, agencies and tools, and compare marketing-only figures with marketing-only figures, never with combined sales and marketing.
Only loosely. The main surveys are dominated by US and European respondents and I have not found an independent India benchmark I trust. Build the budget in rupees from your own CAC and conversion data, and treat US percentages as rough bounds.
Look at CAC payback on a gross-margin basis and at whether each channel's cost per qualified opportunity is stable as spend rises. If payback is stretching and marginal channels are getting more expensive, the budget is ahead of what the system can absorb.