Tech Companies Roll Out Bigger Marketing Budgets

by | 2 minute read

Earlier this year, IDC analysts predicted that technology companies would increase marketing expenditures and shift a significant amount of the effort to digital channels. Changing economic conditions have caused leading tech marketers to pull back on marketing. But the increased spending in the digital component seems to be on track.

IDC’s 2011 Tech Marketing Benchmarks Study finds that the average surveyed marketer is spending about 3.5% more on marketing this year instead of the predicted 8% jump. For the most part, these companies are all giants, generating an average of $9.5 billion in revenue. The survey found significant variation in increased marketing expenditure when considered in terms of annual revenue. By company size, here is the marketing increase breakout:

  •  Revenue under $500 million: +10%
  • Revenue between $500 million and $999 million: +8.1%
  • Revenue between $1 billion and $2.9 billion: +7%
  • Revenue of $3 billion to $9.9 billion +2.1%
  • Services companies (in general): ‑1%

IDC also tracks the type of marketing being done by tech companies. Analysts say that this year, 52% of spending is focused on awareness building instead of demand building. The typical marketing budget at a tech firm is allocated across a number of activities:

  • Digital: 26.4%
  • Traditional: 13.4%
  • Traditional events: 16.6%
  • Direct marketing: 9.6%
  • Other including PR/Sales tools, collateral: 33.9%

IDC analysts are particularly focused on the digital portion of the spending which looks like this:

  • Company websites: 31.6%
  • Display ads: 21.5%
  • Search ads 14.9%
  • Email marketing: 16.4%
  • SEO: 5.9%
  • Social networks: 6.0%
  • Digital events: 3.8%

While larger tech firms haven't increased their marketing expenditures significantly, all firms in this sector are gradually shifting more of their effort to the digital format where their customers, both consumers and businesses, are likely spend more of their media time.

[Source: Key Findings from IDC’s 2011 Tech Marketing Benchmarks. Techmarketingblog​.com. 21 Sep. 2011. Web. 27 Sep. 2011]

 

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-owner of several small businesses in the health care services sector.