How much does the average company spend on advertising? This is a question that has intrigued marketers and business owners alike. The amount of money allocated to advertising can vary widely depending on the industry, company size, and marketing goals. Understanding the average advertising spend can provide valuable insights into how companies are investing in their promotional efforts.
Advertising is a critical component of any business’s marketing strategy, as it helps to create brand awareness, drive sales, and maintain a competitive edge. However, determining the average advertising spend can be challenging due to the vast differences in budgets across various industries. According to a report by Statista, in 2020, the global advertising spend was estimated to be around $643 billion. This figure is expected to grow to $737 billion by 2023.
When it comes to the average advertising spend per company, it’s essential to consider the size of the business. Smaller businesses often have limited budgets compared to larger corporations. According to a study by the U.S. Small Business Administration, small businesses with fewer than 100 employees spent an average of $2,440 on advertising in 2019. In contrast, medium-sized businesses with 100 to 499 employees spent an average of $13,950, and large businesses with 500 or more employees spent an average of $41,870.
Advertising spend also varies significantly by industry. For instance, the technology industry tends to have a higher advertising budget compared to the food and beverage industry. According to a study by eMarketer, the technology industry allocated an average of 11.3% of its total revenue to advertising in 2019, while the food and beverage industry allocated just 3.2%. This discrepancy can be attributed to the competitive nature of the technology industry and the need to continuously innovate and differentiate from competitors.
Another factor that influences advertising spend is the marketing objectives of the company. Companies with aggressive growth goals or those looking to enter new markets may allocate a larger portion of their budget to advertising. For example, a startup that is trying to establish its brand in a crowded market may need to invest more in advertising to gain traction. Conversely, established companies with a strong market presence may allocate a smaller portion of their budget to advertising, focusing instead on maintaining their market share.
In conclusion, the average advertising spend for a company can vary widely depending on several factors, including industry, company size, and marketing objectives. While small businesses may allocate less than $10,000 annually, larger corporations and technology companies may invest millions. Understanding the average advertising spend can help businesses make informed decisions about their marketing budgets and allocate resources effectively to achieve their desired outcomes.
