By Sheila Kloefkorn, President and CEO, KEO Marketing
Most B2B marketing budgets are not built. They are inherited. Last year’s number, plus or minus a few percent, redistributed across the same channels by the same people who ran them. That is why so many CMOs report that their budget cannot deliver their strategy: the budget was never designed to. A marketing plan budget should be the price of the plan, line by line, and nothing else. Here is how to build one for 2026, with benchmarks, the split most companies get wrong, and a worked example.
Start With the Benchmarks, Then Ignore Them
Gartner’s 2025 CMO Spend Survey put marketing budgets at 7.7 percent of company revenue, flat for a second year, with paid media taking 30.6 percent of the total and 59 percent of CMOs saying the budget was insufficient to execute their strategy. Thirty-nine percent planned to cut agency spend and 39 percent planned to cut labor. Those are useful numbers for one purpose: knowing what normal looks like. They are useless for deciding what your company should spend, because normal is not a strategy.
The right budget comes from the pipeline math. Revenue target, divided by deal size, divided by win rate, gives you the opportunities marketing must influence. Cost per influenced opportunity, from your own history, times that number, gives you the budget the plan actually requires. If that figure lands at 5 percent of revenue, spend 5. If it lands at 11, either fund it or cut the revenue target. The benchmark is where you check your work, not where you start.
The Split Most B2B Budgets Get Wrong
Binet and Field’s research for the LinkedIn B2B Institute recommends roughly a 50/50 balance between long-term brand building and short-term sales activation, and finds that brands setting share of voice above share of market tend to grow. Most mid-market B2B budgets are closer to 90/10 in favor of activation. The result is a pipeline that resets to zero every quarter and a company nobody has heard of when the buying committee starts its research. Rebalancing does not mean abandoning demand generation. It means making the brand line visible in the budget so it can be defended.
An Example of a Marketing Budget for a Mid-Market B2B Company
The table below is a simplified version of the structure the KEO Marketing team uses with clients. Assume a $40 million B2B company targeting $6 million in new revenue, with an average deal of $150,000 and a 25 percent win rate. That is 160 opportunities to influence. At a historical cost of roughly $18,000 per influenced opportunity, the plan requires about $2.9 million, or 7.2 percent of revenue.
| Line | Purpose | Share | Approx. spend |
|---|---|---|---|
| Strategy and planning | Positioning, committee research, plan, fractional leadership | 8% | $230K |
| Brand building | Thought leadership, PR, category content, share of voice | 30% | $870K |
| Demand and activation | Paid search, paid social, ABM, events | 35% | $1.02M |
| Content and creative | Committee-mapped assets, video, sales enablement | 12% | $350K |
| Marketing technology and data | CRM, automation, analytics, AI tooling | 10% | $290K |
| Measurement and optimization | Attribution, testing, quarterly reviews | 5% | $145K |
Two things to notice. Strategy has its own line, because a plan without a funded owner is a document. And brand is at 30 percent, not 50, because most companies cannot swing from 10 to 50 in a year without losing the pipeline; 30 is a defensible first step. Sheila Kloefkorn, who leads strategy at KEO as a fractional CMO for mid-market firms, walks through how this example of a marketing budget connects to positioning, planning, and implementation in her complete guide to B2B marketing strategy.
How to Build the Budget in Four Moves
- Zero-base it. Start from the plan’s priorities, not from last year. Every line has to justify itself against the pipeline math.
- Separate brand from activation. Two visible lines. If they are blended, brand always loses the mid-year cut.
- Fund strategy explicitly. Planning, research, and leadership get a line. Companies that bury this in overhead never revisit it.
- Hold 10 percent for 90-day reallocation. Quarterly reviews will reveal channels that outperform. A budget with no flex cannot act on what it learns.
See also: Business Owners: Key Considerations for Ai Deployment
Where Budgets Leak
The leaks are predictable: paid media that outlives its strategy, martech nobody logs into, agency retainers for work the plan no longer prioritizes, and events attended out of habit. The Duke CMO Survey found marketing training budgets have fallen to under 4 percent of spend while channel counts keep rising, which is exactly backward: more channels, less capability to run them. A marketing plan budget built from the plan closes those leaks by default, because every dollar has to name the priority it serves.
This is the budgeting discipline the KEO team brings to its B2B marketing strategy engagements: pipeline math first, brand and activation both visible, strategy funded as a line, and a quarterly reallocation so the budget can learn. It is unglamorous work. It is also the difference between a CMO who says the budget is insufficient and one who can show the CEO exactly what each dollar is for, which is why it sits at the center of how KEO helps mid-market companies build their marketing strategy.
Frequently Asked Questions
What percentage of revenue should a B2B company spend on marketing?
Benchmarks cluster between 7 and 10 percent of revenue, but the correct number is the one your pipeline math requires. Work backward from revenue target, deal size, win rate, and cost per influenced opportunity.
How should a B2B marketing budget be split between brand and demand generation?
Research points toward an even split over the long run. Most mid-market companies should move from roughly 10 percent brand toward 30 percent as a first step, with both lines visible and measured.
Should strategy and planning have their own budget line?
Yes. When strategy is buried in overhead it is never revisited, and the plan becomes a document nobody owns. A visible line, typically 5 to 10 percent, keeps the positioning and planning work funded and accountable.
Want to know whether your budget is funding your strategy or last year’s habits? Request a free marketing audit from the KEO team and get a line-by-line read on where the money is working and where it is leaking.