Should marketing budget include team costs?

Yes, always. A marketing budget that excludes headcount understates the true investment by 40-60%. Include fully loaded team costs (salary, NI, pension, benefits) alongside programme spend for a complete picture.

How should I allocate budget across channels?

Start with your target CAC and work backward. Allocate more to channels with proven lower CAC and higher pipeline quality. A common split for B2B SaaS is 40-50% content and inbound, 25-35% paid, 10-20% events, and 5-10% brand.

Should I include a contingency in the marketing budget?

Yes. A 5-10% contingency is best practice. Marketing needs flexibility to respond to competitive moves, emerging channels, and unexpected opportunities. Without contingency, every new initiative requires a formal re-budgeting process.

How do I justify marketing spend to the CFO?

Tie every budget line to pipeline or brand metrics. Show the expected pipeline generation, conversion rates, and customer acquisition cost for each channel. Present marketing as an investment with measurable returns, not an expense to be minimised.

Example

Departmental Budget Example

A 80-person B2B SaaS company in London with £5.8M ARR. The VP Marketing is building the annual marketing budget for FY2026. The department has 10 people and a total budget of £1.2M covering team costs, paid channels, content, events, and software tools.

Example data

Financial model

Key formulas

fxMarketing as % of ARR = £1.2M / £5.8M = 20.7%

Marketing spend at 20.7% of ARR is within the typical range for growth-stage B2B SaaS (15-25%). This includes fully loaded team costs.

fxCAC = Total Marketing Spend / New Customers Acquired

With a target of 120 new customers, the implied blended CAC is £10k. Paid channels target £7k CAC while inbound targets £4k, with blended landing at £10k after including team overhead.

fxBudget per Channel = Channel Spend / Marketing Budget

The split is 54% people, 18% paid acquisition, 8% content, 8% events, 6% tools, 6% contingency. People-heavy reflects the content and demand-gen focus.

Analysis

What makes this example good

Clear breakdown by category enables meaningful variance analysis

Quarterly phasing reflects the real cadence of marketing spend

Team costs separated from programme spend for headcount planning

Contingency budget provides flexibility without over-allocating

Events phased to align with the actual event calendar

Customisation

How to adapt for your business

Replace the channel mix with your own marketing strategy focus areas

Add a "by campaign" sub-view for more granular tracking

Include a pipeline attribution model to track marketing-sourced revenue

Break team costs into individual roles if you need hire-level planning

Add ROI targets for each channel to hold the team accountable

Common variations

--Channel-first budget where each channel has its own sub-budget
--Campaign-based budget organised around major initiatives
--PLG marketing budget focused on product, content, and community
--ABM-focused budget with account-level spend tracking

Keep exploring

Related examples

Annual Budget Example

A 120-person B2B software company based in Manchester with £5.2M annual revenue. The business sells a subscription product to mid-market companies and is forecasting 18% growth this year. The finance team is building the annual budget for FY2026.

View example

Headcount Plan Example

A 100-person technology company in Cambridge with £7M revenue. The People team and Finance team collaborate on the annual headcount plan, which feeds directly into the P&L budget. This plan covers all departments with fully loaded costs including employer NI (13.8%), pension (5%), and benefits.

View example

Budget vs Actual Variance Report Example

A 60-person marketing agency in London with £4.1M revenue. The Head of Finance produces a monthly BvA (Budget vs Actual) report for the leadership team. This March report shows YTD Q1 performance against the annual budget.

View example

FAQ

Frequently asked questions

For B2B SaaS, 15-25% of ARR is typical during growth phase, dropping to 10-15% at scale. For other industries, 5-15% of revenue is common. The right number depends on your growth targets, efficiency metrics, and stage.

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