It’s not uncommon for marketers to find themselves scrambling for funds. And although marketers received a healthy portion of companies’ budgets in 2014, many may be getting a hardier serving next year. According to the “Presentation for CMO Survey 2015: Eye on the Buyer” report by research firm Gartner, companies spent, on average, 10.2% of their annual revenue on marketing activities in 2014. Half of the companies surveyed plan to increase this spend in 2015, reporting an average budget boost of 10.4%. In fact, those who are already toasting the competition plan to increase their 2015 marketing spend by 13.6%.
But marketers shouldn’t count their eggs before they’re hatched. As expected, bigger companies get bigger budgets. For instance, organizations with revenues of $5 billion or more anticipate dedicating 11% of their money to marketing activities, while companies with revenues between $500 million and $1 billion plan to allocate 9.2%. Still, there’s a sunny-side up to this situation: Overall, companies had a wide spread of marketing budgets as a percentage of revenue overall. Forty-six percent of respondents plan on spending less than 9% of their revenue on marketing, 30% intend to allocate more than 13%, and about one quarter (24%) aim to target a percentage somewhere in between.
So what exactly are marketers spending their money on? In a word, digital. According to the report, 51% of companies surveyed plan to increase their digital marketing budget in the New Year. The average boost will be 17%. That increase will give digital a significant slice of the marketing pie, considering that companies designated, on average, 25% of their marketing budgets to digital in 2014.
For some marketers budget allocation is a tough one to crack because not all companies have separate digital marketing budgets. Sixty-eight percent of companies do, according to the report. But marketers waffle on what a digital marketing budget encompasses. Thirty-two percent of respondents consider digital a single line item of the overall marketing budget, while 36% itemize each digital activity. In addition, 23% have incorporated digital marketing into each function of the marketing budget and 8% have done none of the above.
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