Author: Bill Ross | Published: May 23, 2026 | Updated: May 23, 2026 Setting a marketing budget as a percentage of revenue is one of the most-asked questions in any boardroom. The answer changed dramatically between 2020 and 2025, with the headline average falling from 11% to 7.7% of company revenue. This report breaks down current benchmarks by industry, explains the structural forces holding budgets down, and projects where each sector lands by 2028. Key takeaways from this report The Gartner 2025 CMO Spend Survey, which polls more than 400 marketing leaders at companies with over $1 billion in revenue, found that marketing budgets averaged 7.7% of company revenue for a second consecutive year. That number is significantly lower than the four-year pre-pandemic average of 11%, and the recovery many marketers expected after 2022 never fully materialized. The Deloitte/Duke CMO Survey reports a higher figure (9.4% in 2025), but the methodology explains the gap: Deloitte includes a broader mix of company sizes, and smaller companies typically allocate a higher percentage of revenue to marketing. Whichever source you use, the trajectory is the same. Budgets are stable, not rising. We project a modest recovery to roughly 8.2% by 2028. The reasoning is grounded in three constraints, not a hopeful extrapolation. First, AI productivity gains are real and durable: 22% of CMOs say generative AI has already reduced their reliance on agencies, which keeps headline budgets flat even as output rises. Second, the CFO mindset has reset. The pre-pandemic 11% benchmark is no longer the reference point for new budget cycles. Third, structural shifts in search behavior (zero-click results and AI Overviews) are absorbing budget into experimentation rather than pure expansion.
“Most clients ask us how to get back to 10% of revenue. We tell them to stop trying. The right question is how to make 7.7% produce what 10% used to, and that conversation goes somewhere useful.” – Emulent Strategy Team
This new baseline sets the stage for a more important question: how does that average actually distribute across industries? The 7.7% headline obscures dramatic variation. Consumer products companies allocated 9.7% of revenue to marketing in 2025, while IT and business services firms spent just 5.8%. That six-fold spread between top and bottom is wider than the spread between B2B and B2C, wider than the spread between high-growth and mature companies, and almost certainly wider than the spread between any two competitors in your own sector. The practical implication is straightforward. Benchmarking against the 7.7% average is benchmarking against a fiction. A SaaS founder comparing to that number would starve their growth engine. A manufacturing CEO matching it would torch their margins. The first useful number for any marketing budget conversation is your industry median, not the cross-industry average. Three industries currently sit above 9%: consumer products, manufacturing, and pharma. Four sit below 7%: travel and hospitality, healthcare, IT and business services, and Tech Services companies above $250M in revenue. The middle band runs from 7.1% to 8.0% and includes retail, financial services, insurance, and media. This middle band is where most enterprise CMOs will find their reference point. The flat 7.7% average disguises a violent reshuffling underneath. Six industries cut budget, four added, and one held steady. The biggest movers tell the clearest story about what CFOs are rewarding and punishing. IT and business services posted the steepest decline of any sector, dropping from 9.0% to 5.8% of revenue in a single year. The cut reflects a specific belief: that AI tooling can replace large portions of demand generation and account-based marketing work that was previously labor-intensive. Whether that belief proves correct will determine whether the cut sticks or reverses by 2027. Healthcare, travel and hospitality, insurance, and media all saw appreciable decreases. These industries share a common pressure: their customer journeys are increasingly digital, which makes marketing spend look more like a controllable line item than a strategic moat. For healthcare in particular, the 1.3-point cut feels surprising given the industry’s growing patient acquisition challenges, but the data is consistent across multiple Gartner surveys. On the other side, consumer products gained 3.0 points (the largest single-year jump in the survey’s history), manufacturing added 2.8 points, and pharma added 2.0 points. These sectors faced tariff pressure, GLP-1-driven disruption, and reshoring competition, and the response from CMOs was to rebuild brand spend after years of cuts. Whether that brand investment was paid for with new dollars or by raiding other line items varies by company.
“When a category sees a 3-point jump in one year, the question to ask is not ‘how do we copy them,’ it’s ‘what threat are they responding to that we haven’t priced in yet.’ Big budget moves are usually defensive, not opportunistic.” – Emulent Strategy Team
Industry context tells you which direction your peer group is moving. The next benchmark that matters is whether your business sells to other businesses or to consumers. The B2B versus B2C split is more predictive of marketing budget than industry classification. According to the Deloitte/Duke CMO Survey, B2C product companies allocate 15.5% of revenue to marketing, while B2B product companies allocate just 6.4%. B2C services land near 10%, and B2B services land at 9%. The 2.4-fold spending gap between B2C product and B2B product is not a quirk of sample composition. It reflects fundamental differences in how each business creates demand. B2C product companies fight for shelf share against substitutes that look almost identical to a casual shopper. Their marketing dollars build mental availability and emotional preference, which has to be refreshed constantly because the next ad-supported feed will try to take it back. For specialized B2B marketing strategies, we have separate practice areas covering B2B marketing services and content-led demand generation. The channel mix also differs sharply. B2C companies push roughly 61% of marketing dollars to digital channels and rely on paid media for volume. B2B companies allocate about 55% to digital and still invest 15% to 20% in trade shows and industry events where face-to-face relationships carry weight. The takeaway for any marketing leader: anchor your budget conversation to your go-to-market motion first, your industry second, and the headline average not at all. Once those two filters are applied, the remaining question is where the money goes inside the marketing budget. Inside the total marketing budget, the share of dollars going to each resource category has shifted measurably over five years. Paid media is the only category that has grown its share. Martech, labor, and agencies have all lost ground. Paid media reached 30.6% of total marketing spend in 2025, up roughly 8 percentage points since 2020. The reason CMOs keep funding paid media is straightforward: it has attribution, it has daily levers, and it tells a CFO-friendly story about which dollars produced which conversions. Even when paid media inflation eats into the per-dollar return, the line item is defensible in a way that brand work is not. Martech fell to 22.4%, its lowest level in a decade. The reversal is significant because martech was the rising-tide category through 2022. The current decline reflects AI consolidation, with new generative AI tools absorbing functions that previously required separate platforms for content production, customer segmentation, and analytics. Labor and agency budgets are each being trimmed by 39% of surveyed CMOs, with 22% explicitly citing generative AI as the reason agency hours can come down. Companies investing in AI SEO services see this dynamic firsthand.
“The martech decline is not anti-tool. It’s anti-redundancy. Most marketing stacks built between 2018 and 2022 have three or four tools doing one job. AI is just making the redundancy obvious.” – Emulent Strategy Team
The clearest losers in this shift are agencies that rent labor rather than produce measurable outcomes. Agencies that bring real ROI, automation, and specialist knowledge are still winning budget, but the days of bulk retainers for general support work are ending. Understanding how this reallocation plays out by industry over the next three years is the final question worth answering. Our projection is that industry-level marketing budgets converge toward the 7.5% to 8.5% range by 2028, with the extreme swings of 2025 reversing partially but not fully. The reasoning relies on mean reversion, behavioral anchoring, and the structural forces already in motion. Three industries we expect to drift downward from 2025 highs: consumer products from 9.7% to roughly 8.5%, manufacturing from 9.5% to 8.4%, and pharma from 9.0% to 8.4%. The 2025 jumps in these categories were defensive responses to tariff fears, GLP-1 disruption, and reshoring competition. Once those acute pressures stabilize, CFOs will pull marketing dollars back toward the broader corporate baseline. Two industries we expect to drift upward from 2025 lows: healthcare from 5.9% to about 7.0%, and IT and business services from 5.8% to about 7.0%. The current cuts are based on an aggressive assumption about AI’s ability to replace human marketing labor. We expect that assumption to soften by 2027 as CFOs see the productivity ceiling, at which point budgets get rebuilt closer to the cross-industry median. The largest downside risk to this forecast is a 2026 or 2027 recession. Marketing remains the first line item cut in 44.6% of belt-tightening cycles, and Harvard Business Review’s analysis of 4,700 companies across multiple recessions found that companies which maintained or increased marketing spend grew up to 17% faster post-recession. Knowing that is one thing. Holding the line when the board asks for cuts is another. Setting the right marketing budget is less about hitting an industry benchmark and more about matching spend to the growth your business needs and the productivity your team can extract from every dollar. Our team works with CMOs and founders to build content strategies, allocate spend across channels with proven measurement, and identify where AI productivity is genuinely real versus marketing hype. Whether you operate in healthcare, pharma, or any other category we serve through our full-service digital marketing offerings, we benchmark your situation against peer data, not headline averages. For a deeper look at how our projections align with sector-specific trends, our digital marketing industry report and B2B marketing trends resources walk through the full picture. If you need help defending your marketing budget to a CFO, reallocating spend across channels, or measuring whether your dollars are producing the growth you expected, contact the Emulent team and we will give you a straight read on where you stand and what to do next.
Marketing Budget as Percent of Revenue Benchmarks By Industry and 2026-2028 Projections
What does the average marketing budget look like in 2026?
How does marketing budget vary across industries in 2025?
Which industries gained and lost ground in 2025?
Why do B2B and B2C companies budget so differently?
Where are marketing dollars shifting within the budget?
What should leaders expect by 2028?
How does Emulent help you set the right marketing budget?
