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Marketing Budget Allocation and Financial Considerations
The optimal marketing budget allocation for companies with fine product market fit in a competitive market is typically 10 to 20%. The budget should prioritize fulfilling the demand model and allocate the rest for brand spend and performance marketing. Many B2B companies spend less than 10 to 20% on brand, leading to insufficient market awareness and overpayment on performance marketing. It is crucial for CFOs to collaborate with marketers to invest in marketing soundly and fiscally, ensuring a balanced approach to budget allocation.