The February 2019 CMO Survey is out. Now in its 11th year, the survey spearheaded by Dr. Christine Moorman at Duke’s Fuqua School of Business, offers a unique look at marketer trends. This year, marketers are less optimistic than they’ve been in the past seven years. While survey takers indicated they’ll spend more on marketing in 2019, they also reported a new development in social media.
Declining Optimism and Shifting Marketing Budgets
On a scale of 1 to 100, marketers put their optimism about the overall economy at 57.6 percent. Last August, that number was 66.8 percent. At least 21.3% believe consumers will place a top priority on lower prices this year. In addition, marketers say their online sales now account for 9.9% of their total activity. That number is a significant drop from the 12.2% reported at the time of the last CMO survey in August 2018. These trends suggest that marketers may be feeling pressure from competitors like Amazon that control a significant percentage of online sales.
Because optimism has fallen significantly, marketers will be taking specific action to secure their position in the marketplace. First, the average business will increase its marketing budget by 8.3 percent. Here’s how the planned percentage increases break out by business category:
- B2B Product 8.5%
- B2B Services 10.3%
- B2C Product 2.9%
- B2C Services 9.6%
Business owners also shared how they’ll break out their marketing budget growth by activity in 2019:
- Brand spending 9.3%
- CRM spending 9.2%
- New service introduction spending 6.6%
- New product introduction spending 7.7%
Social Media Surprise
For several years, social media marketing has benefited from generous budget increases. In 2019, the average business will likely spend 11.4% of the marketing budget on social media. That’s a significant drop from the 13.8% figure reported last summer. A deeper dive into the data shows that companies with less than $25 million in revenue will likely spend more on social media — up to nearly 15 percent. They may be hoping social media will provide them with a less expensive way to compete. In addition, businesses with higher percentages of online sales also spend more than average on social media.
Despite the pullback, businesses say it’s likely that social media will account for up to 19.7% of the marketing budget over the next five years. Businesses are still struggling to connect their social media investment to their overall performance, though. Over the past several years, social media’s rating has never risen above a 3.4, on a scale of one to seven, where seven indicates a very high contribution. Social media is also an area where businesses feel they lack expertise. As a result, about 25% of social media work is outsourced.
To learn more about which consumers are most influenced by social media marketing, check out the AudienceSCAN profiles available on AdMall from SalesFuel.com.