Marketing Budgets to Increase by 6% This Year
One of the best parts of a regularly conducted survey is the ability to track trends. The CMO Survey, jointly produced by Duke University’s Fuqua School of Business and the AMA, provides excellent detail on where advertisers see the market heading. The most recent study in this series points to some very positive trends.
Businesses in every sector of this study, B2B products and services and B2C products and services, are feeling more optimistic now than they were in August 2012, the date of the last survey.
These sectors say they’ll be increasing their ad budgets as follow this year:
- B2C Products 9.2%
- B2C Services 6.7%
- B2B Products 4.2%
- B2B Services 7.1%
On average, the companies in this survey will increase ad budgets by 6.1%. They’ll cut their allocation to traditional media by 2.7% but increase new media spending by 10.2%. The B2C services sector will cut their traditional media budgets more than the other groups, by 5.4%. And, the B2C products sector will increase digital media spending the most, by 14.6%. Not surprisingly, firms in this survey will increase their social media budgets, too. The format will account for 11.5% of the marketing budget by year-end.
Increased ad spending by strategic initiative breaks out as follows for the year:
- New product introductions 8.0%
- New service introductions 5.8%
- Customer relationship management 8.1%
- Brand building 6.8%
Overall, these firms say they have a marketing ROI of 3.3%. But they are still struggling with social media integration and metrics. In the last six months, more firms have shifted to measuring followers and friends (30.5%) and buzz indicators (16.2%). Fewer are trying to measure financial metrics like revenue per customer (9.2%) or profit per customer (4.5%).
Marketers will likely continue to grapple with how to measure their social media investment results but it doesn't seem that they are ready to cut back on what they're spending on the format.[Source: CMO Survey.org. Fuqua School of Business-AMA. Feb. 2013. Web. 15 Mar. 2013]