Findings from the Gartner 2016-2017 CMO Spend Survey suggest that the size of marketing budgets continued to rise in 2016, reaching 12% of company revenue. The data was pulled from more than 300 leaders in marketing across the UK and U.S. The survey was conducted to discover how much their companies allotted for marketing and what their budgets said about their priorities.
Surveys like this are important because they can help companies set a benchmark for how much to spend on marketing, preventing them from spending way more or less than their peers or competitors. The 2016-2017 survey indicates marketing budget increases for the third consecutive year with smaller companies spending approximately 10% of revenue and larger companies spending about 13% of revenue on marketing. Smaller companies are those with revenues between $250 million and $500 million while larger companies are those with revenues greater than $5 billion.
Greater spending on online marketing
The survey revealed that marketing leaders spent more on digital advertising, digital commerce, and on their websites. This trend of companies investing more heavily in digital marketing has been equally noted in other surveys.
The Internet Advertising Bureau(IAB) UK and PwC publish a yearly survey providing online advertising figures from the previous year.The latest report by the IAB and PwC indicates that in 2016, digital advertising grew by 17.3% to £10.3 billion. This is the fastest growth rate in 9 years, with 2007 being the last time annual growth was marked that high. The rise is due to advertisers wanting to take advantage of the average consumer’s rising consumption of mobile content. Businesses need to learn 1 to 1 marketing for better customer service and retention.
Social media spending saw significant growth with social media sites eating up 46% of display ads as ad spend in the area grew by 38% to £1.73 billion. Spending on mobile social media grew even more with 54pc growth recorded. Businesses that don’t spend enough on social media may need to learn to effectively use social media for business using guides such as AXA’s in order to gain an understanding of how properly planned spending could help drive better results.
Companies are spending more on video for PC and mobile platforms with video ad spend growing at 56%. While spending on display and programmatic ads grew 26% to £3.77 billion, spending on paid-for search rose 15% to £4.99 billion claiming a share of 48pc of digital ad spend. Classifieds rose 8% to £1.48 billion while native and content ad spend grew 28% to £1.17 billion. Again, businesses that may have ignored any of these areas of online marketing will benefit from learning why and how they should use them to boost their business.
