How much should a contractor spend on marketing?
Most home service contractors spend 5 to 10 percent of revenue on marketing, per 2025 and 2026 benchmarks. Established shops with strong referrals sit at 5 to 7 percent, growth focused shops run 8 to 12 percent, and newer shops in their first few years often need 12 to 20 percent to build visibility. The number that matters more than the percentage is whether you can see which spend actually produces booked jobs.
Marketing budget by business stage, 2026.
These bands come from 2025 and 2026 contractor marketing benchmarks. Where you land depends on growth stage, competition, and how much of your work comes from repeat customers. Sources at the bottom.
| Stage | Percent of revenue | Why |
|---|---|---|
| Established, strong referrals | ~5 to 7 percent | Maintain position, steady backlog |
| Growth focused | ~8 to 12 percent | New areas, new services, taking share |
| New, first few years | ~12 to 20 percent | Building visibility from zero |
| SBA guidance, under $5M | ~7 to 8 percent | General small business rule of thumb |
Budget against target revenue, not last year's. If you are a $1.5M shop chasing $2M, budget the percentage against $2M.
The metric that beats budget size.
The percentage is the wrong thing to obsess over. What you can measure is the right thing.
A shop spending 5 percent with clean tracking and a 50 percent close rate beats a shop spending 10 percent that cannot tell which channel produced which job. Most contractors cannot. Their tracking is broken or missing, so they guess. In one build we found a pixel undercounting conversions by seven times, which meant every budget decision was made on wrong data. Fix the measurement first. Then the percentage takes care of itself, because you can pour into what works and cut what does not.
You cannot optimize what you do not own.
Most contractors rent their marketing tools and their data lives on someone else's servers. When you own your ad accounts, pixel, and reporting, you see the truth in real time and change it the same day.
Owned tracking
One shop we built for took jobs from 159 to 283 in a year, on owned data, after we fixed the tracking that was hiding what worked.
Owned decisions
No waiting on a vendor dashboard to update. It is your system. See the number, make the call, move the budget.
Where these numbers come from.
2025 to 2026 contractor marketing budget benchmarks from Pipeline On, Boomcycle, and CallRail home services statistics, plus general US Small Business Administration guidance. Ranges are approximate. The 159 to 283 and seven times figures are from one anonymized Forge build.