The CMO Survey Blog

Six Reasons Marketing Budgets are on the Rise

Marketing budgets as a percent of overall firm budgets and as a percent of firm revenues are both on the rise as noted in my prior post. Why are firms spending more on marketing? Here are six reasons I see in The CMO Survey™ data and in my research.

  1. New jobs: Marketing appears to be taking a leadership role in managing social media activities in companies. Given social media spending as a percent of marketing budgets is expected to rise from 7.6% to 18.8% over the next 5 years, this means new funds are flowing toward marketing.
  2. New skills: Companies plan to increase marketing training by 3.7% in February 2012 to 7.2% in August 2012. In particular, I see many companies in investing in programs to build marketing capabilities. A good example is GE’s Experienced Commercial Leadership Program, which develops cohorts of young marketers for the company. Another example is Becton Dickinson’s Marketing Excellence Initiative, which provides non-marketers with a big dose of training in key marketing tools and processes.
  3. New knowledge: Big Data has captured the imaginations of leaders in companies big and small. The ability to leverage information about customers in order to deliver and demonstrate value opens the door for marketers to fill the role as analysts and “data whisperers” as McKinsey calls them. As noted by McKinsey in its Chief Marketing and Sales Officer forum, “Data whisperers are those analysts who can coax meaning and insights from the increasingly sophisticated and massive data sets available today.” (more…)

The Social Media Integration Gap

Last week I reported on the expected increase in social media spend from an already high 7.4% of marketing budgets to 10.4% within a year and 19.5% within five years. It is therefore both interesting and somewhat disturbing that we continue to see a sizable fissure between what companies are doing with social media and what they are doing with the rest of their strategies. I asked CMOs to rate “How effectively is social media integrated with your firm’s marketing strategy” on a seven point scale where 7 is “very integrated” and 1 is “not at all integrated.” Results from The CMO Survey indicate an average score of 3.8 with a standard deviation of 2.0. Sadly, only 7 percent of respondents believe that social media is “very integrated” to the firm”s strategy while 18.4% rated social media as “not at all integrated.” The full distribution of responses is shown in Figure 1.

Social Media Spend Continues to Soar

Results from The CMO Survey, February 2012 indicate that marketers continue to increase spend on social media. In the next 5 years, marketers expect to spend 19.5% of their budgets on social media, almost three times more than the current level! Within a year, marketers expect to spend 10.8% of their budgets on social media. These figures deserve a deeper investigation into what has been happening over time. First, social media spend, as a percent of marketing budgets has continued to increase over the last 2.5 years I have been measuring these levels in The CMO Survey. From the initial level of 3.5% in August 2009, we have witnessed an 111% increase to the current levels at 7.4% (see Figure 1).

Who Outsources Marketing?

There are good reasons to outsource marketing and many companies choose to do so. Let’s look at more CMO Survey results to get a sense of what types of firms are outsourcing marketing and what financial and strategic conditions appear to give rise to outsourcing. (more…)

Outsourcing Marketing

I asked top marketers to report how much they expected their companies to outsource marketing in the next 12 months. This percentage has grown over time as shown in Figure 1. In fact the last measurement, taken in August 2011, grew by over 100% over the prior year! (more…)

Investing in Social Media

The August 2011 CMO Survey reported that companies are increasing spend on social media (from current levels of 7.1 percent of marketing budget to 10.1 percent over the next year and to 17.5 percent in the next five years). These are big numbers and they have been waved around a lot on the internet. What’s striking to me is these same companies report that they employ, on average, only two people dedicated to actually doing social media (standard deviation 4.8). Houston, we have a problem—well, maybe three problems. (more…)

Why Hire a Marketer?

The CMO survey reports that companies anticipate hiring 7.2% more marketers in the next 12 months. The survey also shows that consulting companies will experience the largest increase (+17.3%) followed closely by manufacturing (+14.9%), technology (+12.5%), banking/finance (+11.9%), and healthcare/pharmaceuticals (+8.3%). (more…)

Who’s Hiring? Marketing Job Prospects

The August 2011 CMO Survey asked top marketers to report on hiring plans by responding to the forward-looking question, “Compared to the number of marketing hires last year, by what percentage will your firm’s marketing hires change in the next year?” The response was encouraging. Marketers report their companies will hire 7.2% more marketers in the next 12 months than they did the year before. These numbers are up from 6.2% in February 2011 and 4.0% in August 2010, but down from a high of 12.9% in February 2010. (more…)

As CMOs See It: Dramatic Improvements On All Economic Fronts

The results of the February 2011 CMO Survey are in and the news is unequivocally positive.  421 top marketers shared their views to create the following portrait of healthy economy-wide, firm, and job effects. (more…)