There's no single right number, but there is a simple way to work it out. Here's how to set a monthly marketing budget from your revenue and goals, with naira examples.
Most small business owners set their marketing budget by gut feel, or spend whatever is left at the end of the month. That's why marketing so often stops and starts and never builds momentum. A better way is to tie your budget to two things you already know: your revenue and your goals.
1. Start with a percentage of your revenue
The simplest starting point is to spend a set share of your monthly revenue on marketing. For reference, the US Small Business Administration has suggested 7 to 8% of revenue for small businesses. In Gartner's 2026 survey of mostly large companies, marketing budgets came to 7.8% of revenue.
Those figures come from bigger markets, but they're a useful guide. Here's how we'd think about it for a small business in Nigeria:
- Steady, established business: 5 to 8% of revenue to keep sales coming in.
- Growing and want more customers: 8 to 12%.
- New brand or launching a product: more for a set period, as long as your cash flow can handle it.
Example: a fashion brand making ₦4,000,000 a month that wants steady growth might spend 8%. That's ₦320,000 a month on marketing.
2. Check it against your sales goal
A percentage tells you what you can afford. It doesn't tell you what you'll get for it. For that, work backwards from your goal.
Say the same brand wants 100 extra orders a month, and its target cost per customer is ₦7,000. It needs about ₦700,000 a month in ad spend:
100 orders × ₦7,000 = ₦700,000
That's more than double the ₦320,000 its revenue supports. When the two numbers don't match, you have a few options:
- Lower the goal. ₦320,000 at ₦7,000 per customer gets you about 45 orders.
- Bring down your cost per customer with better ads, offers or product pages.
- Raise your average order value with bundles or add-ons, so each customer is worth more.
- Spend above your usual percentage for a short period, if you have the cash and a clear plan.
Not sure what your cost per customer is? Our guide on working out your cost per customer walks you through it.
3. Split the budget across what you actually need
Your marketing budget isn't only ad spend. It also pays for the things that make your ads and content work. Here's how that ₦320,000 might be split:
- Ads: ₦190,000 (about 60%). Meta, TikTok or Google, depending on where your customers are.
- Content and creative: ₦65,000 (about 20%). Product photos, short videos and content from creators.
- Tools: ₦30,000 (about 10%). Your email platform, design apps and scheduling tools.
- Testing and buffer: ₦35,000 (about 10%). New ideas to try, plus room for price changes.
Your split will depend on your business. A brand that already has strong content can put more into ads. A brand with weak photos should fix that first, because no ad budget will save poor creative.
4. If your budget is small, focus it
If you have less than ₦150,000 a month, don't spread it across four platforms. Small amounts split many ways don't give any one platform enough to work with, and you won't learn what's working.
- Pick the one platform where your customers spend the most time.
- Put most of your budget there and keep it running for at least a few weeks.
- Use free channels alongside it: your Instagram and TikTok pages, WhatsApp, and email to past customers.
For more on ad budgets, read How Much Should You Spend on Facebook Ads in Nigeria?
5. Plan for price changes
Costs in Nigeria can move quickly. If you pay for ads with a naira card on a platform that charges in dollars, your naira cost goes up when the exchange rate moves. Content and tool costs can change too.
Keep a buffer of about 10% in your budget, and review your numbers every month instead of setting a figure once a year.
6. Give it time, then review
Marketing rarely pays off in the first week. Keep your budget steady for two to three months before you decide what's working. Each month, check:
- How much revenue came from your marketing
- Your cost per customer, compared with your target
- How many customers came back to buy again
If the numbers are improving, you can raise your budget with confidence. If they're not, fix the problem before you spend more.
Work out your numbers
Our Ad Budget Planner does the maths for you. Enter your prices, costs, margin and sales goal, and it shows your target cost per customer, the ad budget you need and how to split it across Meta, TikTok and Google.
Want help setting a budget for your whole business? Book a consultation and we'll build the plan with you.