One of the first questions businesses ask about marketing is also one of the hardest to answer:

How much should we actually spend?

You will find plenty of recommended percentages online. They can provide context, but they should not become the strategy.

A marketing budget should be based on the growth target, economics of the business and cost of reaching customers — not an arbitrary percentage.

There is no perfect marketing percentage

A neighbourhood restaurant, a new resort and an established hotel group operate under completely different conditions.

Even two similar businesses in the same city may need different budgets because one already has strong demand while the other is still trying to become known.

Start with the commercial question: what are we trying to change?

More reservations? More direct hotel bookings? A new opening? Better weekday demand? More qualified enquiries? Stronger local visibility?

The objective determines where money needs to go.

The stage of the business matters

A new hospitality business usually has to spend differently from an established one.

  • New business: more investment may be needed to build awareness, search visibility, content and initial demand.
  • Established business: the priority may shift toward efficiency, retention, direct bookings and stronger-performing channels.
  • Growing business: marketing may need to support new locations, markets, products or customer segments.

A fixed budget that ignores the stage of the business can easily be too much in one area and not enough in another.

Know what a customer is worth

Marketing becomes easier to judge when you understand the economics behind a customer.

A hotel booking worth several nights can support a different acquisition cost from a single restaurant visit. Repeat customers also change the calculation.

Useful questions include:

  • What is the average booking or transaction worth?
  • What margin does the business keep?
  • How often does a customer return?
  • What are we currently paying to acquire demand through OTAs, advertising or promotions?

Without this context, deciding whether marketing is “expensive” is mostly guesswork.

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Hospitality Marketing

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Build the budget around priorities

Once the objective is clear, decide what actually needs funding.

That may include advertising, search, content, creative, technology, photography, campaign management or external support. Not every business needs every channel at the same time.

Then measure what happens and adjust.

If a channel consistently brings profitable customers, there may be room to invest more. If it creates activity without meaningful business, spending more is unlikely to fix it.

The right marketing budget is not the biggest one. It is the amount the business can invest intelligently, measure properly and connect to a realistic growth objective.