The standard advice — "spend 5–10% of revenue on marketing" — is a platitude wearing a percentage. It tells a $400k Houston plumbing company to spend somewhere between $20k and $40k a year without saying on what, expecting what, or why. Here’s the framework we actually use, built backward from the only numbers that matter.
Start from customer value, not revenue
Two questions set the ceiling: What’s a new customer worth? (first job margin plus honest lifetime value — the repeat and referral tail most owners undercount), and what can you afford to pay to acquire one? A customer worth $2,000 over three years can justify a $200–$400 acquisition cost all day. Once you know your allowable cost per customer, budget stops being a percentage and becomes arithmetic: desired new customers per month × allowable cost = acquisition budget. Everything else is allocation.
Fund the layers in order
- Foundation (one-time + trivial upkeep): Google Business Profile and review engine, a site that converts, instant capture. Funding acquisition before capture is filling a leaking bucket — this layer multiplies every later dollar.
- Harvest (monthly, scalable): search ads on high-intent terms, LSAs where relevant. This is where the acquisition math from above lives.
- Compounding (monthly, patient): local SEO and content that shifts your mix from rented to owned over 6–12 months.
- Multipliers (cheap, ongoing): follow-up sequences, reactivation, referrals — the highest-ROI line items on the whole sheet, funded last only because they need the others’ inputs.
The honesty tests
If you can’t state your cost per booked job, you don’t have a budget — you have spending. If a channel can’t be measured, it competes for surplus, never core budget (billboards, we’re looking at you). And if the total the framework produces scares you, shrink the goal, not the capture layer.
Run your own numbers — customer value, allowable cost, target growth — and the budget writes itself. Want it sanity-checked against Houston benchmarks for your trade? Ask our AI or email hello@mediajunkie.io; we’ll tell you if your math (or your agency’s) holds up.