Tips For Planning Your 2027 Marketing Budget

Marketers know that things change from year to year, but 2026 has been a different kind of year. This year has changed how people find businesses, where audiences are watching TV, and how much of a role AI plays.

The biggest mistake your business can make in 2027 is treating your budget like a copy-and-paste job from 2026. I’ve put together some tips designed to help you build a budget that is a reflection of where your audience is spending their time now, not where they were 12 months ago.

What’s Changed Since You Last Set A Budget?

AI Is Rewriting How People Find Businesses

People used to type a question into Google, scroll through results, and click a link. Now AI crawls the web and returns an answer. AI tools like ChatGPT, Google AI Overviews, Perplexity, and Claude answer questions directly, no clicking required. In fact, according to SparkToro’s June 2026 study, 68% of Google searches now end without someone making a single click. Why? Because AI summarizes the answer.

This is where Answer Engine Optimization  (AEO) and Generative Engine Optimization (GEO) come into play. They ensure that your business shows up when someone asks an AI tool a specific question.

Streaming TV Is For Everyone

Connected TV (CTV) covers streaming services like Hulu, Peacock, and Tubi what you watch on a smart TV rather than on broadcast or through cable.

Placing ads on streaming used to be reserved for those with big budgets. That’s not the case anymore. Even advertisers who spend under $1 million per year are buying into CTV.

There are a couple of reasons for that. Not only has streaming become more accessible for all advertisers, but streaming is where the people are. Nielsen’s July 2026 Gauge report found that streaming made up 49% of all TV watch time that month, compared to 19.5% for broadcast and 18.7% for cable. Trends show that number will continue climbing, as it’s been rising steadily throughout 2026.

AI Spending Is Outpacing AI Understanding

The CMO Survey — conducted in partnership with Duke University, Deloitte, and the American Marketing Association — asked leaders in marketing to rate on a scale of 1 to 7 how well their companies are handling different tech skills.

Two of the lowest-rated skills were:

1. Generating ROI from marketing technology.
2. Proving ROI to leadership.

While teams are quick to adopt new tools, including AI, they’re adopting them quicker than they can understand them and prove that they’re worth the investment.

What does that mean for businesses like yours and mine? Throwing money at AI without understanding what you’re aiming at doesn’t work. You need a plan behind those dollars.

What Are Some Tips For Building Your 2027 Marketing Budget?

Start With Your Goals, Not Last Year’s Number

Don’t just restate last year’s budget line-for-line. 2027 comes with its own challenges and opportunities. Consider what you want to accomplish this year. Do you want:

• More leads
• Repeat business
• Business expansion

For example, if your business wants to grow revenue by 20%, you’ll need a bigger budget than a business whose goal is to maintain what they already have. Your goals should decide your budget numbers, not the other way around.

Resist the urge to pick a channel first. Instead, choose what you want to accomplish, then decide what channel can help you get there.

Use Industry Benchmarks As A Range

The CMO Survey’s 2026 Topline Report notes that the mean marketing spend of a company’s revenue is 8.96%, but the median is 5%. That means half the companies they interviewed spent less than that amount.

A small number of big spenders brings that number up. Typical businesses, especially smaller ones, tend to land closer to 5%, not the higher end of the range.

The range matters more than the average here. Some businesses spend above 5%, some spend below it, but both are reasonable depending on their goals.

Set Aside Budget For AI Visibility

AI search has changed what it means to be discoverable online. You want to make sure your business shows up when they ask AI a specific question, not just when they ask Google category-wide questions. The best way to get there is through AEO and GEO best practices.

Best practices include:

• Making sure your business’s name, hours, and services are accurate everywhere online.
• Having content on your website that directly answers questions your customers are asking.

This past year, I worked with a family-owned business in the Midwest that ranked on page 1 of Google for more than a decade. Then, a customer told them they had asked ChatGPT, and it recommended this business’s competitor instead. That one piece of information changed how this business thought about their entire marketing budget, and now we build AI visibility into every plan they make. Being found on Google isn’t the same as being recommended by AI.

Place Spend Toward Streaming

CTV is more accessible than it’s ever been. That accessibility makes it testable at a much lower budget than people expect.

Of course, I don’t want you to abandon what’s already working for you. Instead, think of it as using streaming to test and learn instead of overhauling the strategies that are working. Even a modest monthly amount taken from an underperforming channel and put into CTV is enough to run that first test. You might be pleasantly surprised by the results!

Five years ago, I would have told a $500,000/year business that TV advertising wasn’t in the cards for them, but I can’t say that anymore. I watched a local client run their first streaming TV campaign this year for less than they used to spend testing a new social platform, and it outperformed everything else in their strategy. This shift is one of the biggest hidden opportunities in most 2027 budgets.

Place A Portion Of Budget Toward Existing Customers

I like things that are bright, shiny, and new. I know I’m not the only one; we’re marketers after all! That’s why so many marketing budgets are built around finding new customers.

People forget how important it is to stay in front of your existing customers. It’s easy to do. Something as simple as an email newsletter, a loyalty discount program, or a “we miss you!” offer for customers who haven’t shopped with you in a while. Anything that reminds customers that you appreciate them and you’re thinking about them is worthwhile.

Don’t Forget To Check In

Many people don’t like working with their budget. I know it’s tempting to set your budget in December and forget about it until the next winter rolls around, but I encourage you to resist doing that.

Instead, build in three or four checkpoints throughout the year to review what’s working and adjust as needed. It only takes 30 minutes to see what channels are producing leads and sales, and which aren’t, and reallocate when the numbers tell you.

What Should You Expect To Spend In 2027?

If you’re a new business or a startup, you’ll be building awareness from scratch, so expect your percentage to be noticeably higher than the 5% median — sometimes even in the double digits. If you’re an established business, you can likely run leaner.

Use the median as a starting point, then adjust up or down depending on where your business is and where you want it to go.

What Are Some Budget Mistakes To Avoid?

• Copying last year’s numbers, line for line, without asking yourself what actually worked and what didn’t. Yes, this is the path of least resistance, and the one that’s least likely to move the needle.
• Spreading your spend around too many channels instead of investing more heavily in the channels with the highest return.
• Waiting until December to check results instead of building in three or four checkpoints to course-correct throughout the year.

Do You Need Help Creating Your Budget?

Some marketers can manage their budget just fine on their own. Others need the help of a partner. Ask yourself these questions to find out where you stand:

• Do I have someone tracking results across channels regularly?
• Do I have the tools and logins needed to run and measure things like a CTV campaign or an AI visibility campaign?
• Is marketing the responsibility of one person with a long list of responsibilities, or is it a dedicated role for someone?

Managing your budget yourself can work if you have the time and tracking software in place, but a partner like FDS makes sense when you’d rather work with someone who understands your business and knows how marketing channels perform together.

I like to think about a marketing budget the way a coach thinks about a game plan. You don’t wait until you’re down at halftime to figure out your strategy. The businesses I saw succeed in 2026 planned early, built room to adjust, and didn’t wait until January to start asking questions. That’s the mindset I’d encourage every business to bring into 2027.

Of course, budgets aren’t perfect on Day One. They don’t need to be. They need a clear starting point and a solid plan tailored directly to your business. For help creating that plan, reach out to the team at Federated Digital Solutions — we’re happy to help you build that plan.

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