The tech sector – services, hardware and software – has caused plenty of market disintermediation over the years. Regardless of how visible many of these companies may be, they still need to spend money on advertising. The expected increase in IT marketing budgets will be smaller than usual this year, 3.5%, but enterprises plan to focus on efficiencies and spend more on digital.

The typical tech company allocates the marketing budget across the following programs:

  • Traditional advertising 13.4%
  • Digital marketing 26.4%
  • PR/marketing support/collateral, etc. 33.9%
  • Events other than digital 16.6%
  • Direct marketing (not email) 9.6%

Within the digital component of the budget, it’s worth noting that the formats receiving the most funding are: company websites (31.6%), display ads (21.5%, and email marketing (16.4%). But big changes are coming this year. Surveyed companies in IDC’s Tech Marketing Barometer were asked to assign importance levels, out of 100 points, to various digital formats. The company website got the top score of 22.5% and email was the next highest at 15.7%. However, with SEO at 14.6% and social marketing at 14.5%, tech marketers indicate that these formats will receive more attention than display ads.

The additional attention focused on SEO and social also means that tech marketers will need better tools to manage the data associated with these formats. As a result, these businesses will spend 8.7% of the marketing budget on in-house IT, a significant increase over what had previously been chewing up between 2% and 3% of marketing dollars.

The top priorities for tech enterprises as they refine their marketing budgets include improved lead generation (20.7%), more brand awareness (16.2%), and improved marketing processes (13.9%).

IDC analysts note that IT firms tend to spend $4 on sales for every $1 spent on marketing. Because some buyers are complaining about sales departments “pursuing them too hard”, analysts believe enterprises in this sector may begin to shift more funds from sales into marketing. This strategy would allow them to stay visible but not appear too pushy in leading buyers to the purchase funnel.

[Source: Ferrantino, Joseph and Vancil, Richard. 2012 CMO Tech Marketing Barometer Study. Idc.com. 2012. Web. 16 Oct. 2012]