As Director of Marketing for our agency and seeing the news with the changes in gas prices and talk of inflation, I wondered how this might affect our clients and their plans for the remainder of the year.
A couple days later, a webinar popped into my inbox from Gartner on the CMO Spend Survey for 2022.
I thought I'd take the time to share some insights with our readers in case you missed the webinar (and let you know what to expect as you are having conversations with your leadership teams over the next few months).
When I was on the client side, I used to dread the budget conversation every month.
I always felt guilty for how much it costs to truly market a company the right way. In the last decade or so, I began to say “to do this the right way and to bring value we need to spend this amount.” By stating that, I was able to utilize my marketing budget accordingly and grow it over time.
I preface this post on the budget conversation because I believe there are many marketers out there that feel the same way. Your job has value—but be prepared to show it when your programs are finished by sharing results, learnings, and adjustments along the way. This is exactly what the CMOs surveyed have done in this webinar.
Gartner has been surveying CMOs on budgets for about a decade. This year’s was 50% U.S.-based with a split of 42% B2B and 36% B2C, with the remaining having a mix of both business models. Fifty-eight percent of those surveyed were in businesses with $2 billion plus in revenue.
With inflation, the war in Ukraine, soaring gas prices, and COVID-19 still lingering…how are marketers faring? (There are plenty of job openings, as LinkedIn is showing us every day.)
There were interesting polls in this webinar, including “will inflation have an impact on delivering the participants’ 2022 marketing plans?” and most saw a somewhat negative impact.
In contrast, another question asked was “what level of impact would labor costs, business costs, and costs to customers have on your 2022 marketing plan?” (In other words, inflation.)
There was a disconnect in the way the question in the survey was presented and the poll, as inflation tends to make businesses review plans to ensure they will not be negatively impacted.
How Did Marketing Perform?
The next question CMOs were asked was about value: how did the part of the business that marketing is aligned to perform against the following objectives in 2021? In the survey, 87% said they exceeded their goals with revenue and profit growth, acquiring and retaining customers as well as improving loyalty and repurchase.
We marketers like to see this, and having the KPIs in place to show leadership exactly how much is helpful in order to keep and grow your marketing budgets year over year. If you are a B2B marketer, an account-based marketing (ABM) program can help hone in on this and fill your pipeline with meaningful business. Additionally, a B2C marketer may want to give consumers the same experience across every channel by orchestrating the best brand experience; omnichannel planning does this.
Is Digital Marketing Still New?
Further on in their presentation, they discussed the “digital marketing” aspect and asked if people were going to decrease investment now that offline tactics were back on the table with the decrease in COVID-19 and increase of in-person events and other pre-pandemic activities. Finally, someone said it. Digital is here to stay and it is just another tactic; stop acting like it is something new. It should be part of your marketing mix regardless of your business model. The consumer is changing and there are people online in every generation.
Personally, I know 80-year-olds that are more digitally savvy than some 50-year-olds—and younger generations have never lived without digital experiences. Digital should be a significant part of your marketing mix, period.
There may be new digital experiences that pop up over time, and those should be evaluated to see if they are right for your business and if your target audience uses them.
Brand Awareness vs. Performance Marketing
Another item worth mentioning is the split between how much CMOs will spend on brand awareness vs. performance marketing.
What Gartner’s research found is that it’s a 50/50 split; given the state of inflation and consumers having less money to spend, brands need to ensure consumers have a good reason to spend their hard-earned money on your products vs. any other.
Are Budgets Back to Pre-Pandemic Levels?
Gartner found that budgets were coming back to pre-pandemic levels and on average will be about 9% of revenue. They are not completely back to the 10% of revenue we experienced in 2019, though the outlook for marketing budgets is positive and moving in the right direction.
While it’s undeniable that inflation has people worried, it’s important to be brand aware and ensure customers know why they should buy your products and services. They need to know you are thinking about them so that when they need your product or service, they think about you.Kreber Has the Expertise You Need
With more than 100 years of experience, we’ve built a reputation for our hard work and dedication to delivering creative ideas and positive outcomes for retail and B2B clients. As an independent content marketing agency with a history of thinking ahead, we create and grow opportunities that allow our partners to thrive. We take pride in our mission to Think, Create, and Deliver compelling content that’s visually stunning, innovative, and purpose-driven within the creative market. We use our century’s worth of industry knowledge to help our clients save time and money, execute successful campaigns, utilize technology, and handle the strategy, planning, creation, management, and distribution of advertising and marketing content. From print and digital content marketing to social media marketing and everything in between, we’re the advertising agency of choice to bring any vision to life.