The end of the year is usually jammed packed. We strive to accomplish in three weeks what we usually complete in four.
It’s not just the volume of tasks to be finished in a compressed timeline that makes this time of year hectic – but the type tasks as well: closing key deals you’ve been working for months, wrapping up strategic plans for the new year, and of course making the case for marketing budgets.
So I’ve chosen marketing budgets as the focus for this week’s Unscripted Marketing links [UML]. As it is every week, below you’ll find three articles I’ve vetted and recommend for in-depth reading. This week covers budget forecasts, planning considerations and the line item for influencer marketing.
1) B2B to Invest 12.3% of Revenue in Marketing
Businesses will increase investments in marketing for the third year in a row according to the Gartner CMO Spend Survey for 2016- 2017. In a piece for the American Marketing Association, titled Gartner’s CMO Spend Survey Shows Marketing Budgets on the Rise in 2017, staff writer Sarah Steimer, provides a useful summary of the full 24-page study:
“The findings are based on Gartner’s survey of 377 marketers in North America and the U.K. at companies with more than $250 million in annual revenue. Those surveyed at companies with more than $5 billion in annual revenue tend to spend 13% of their revenue on marketing, versus 10% at smaller companies that have $250 million to $500 million in annual revenue.”
Where will marketing invest that budget?
“The survey showed the top three categories in 2016 marketing spend were web, digital commerce and digital advertising. Sixty-five percent of marketing leaders said they plan to increase their spending on digital advertising, with 23% expecting a significant increase and 42% anticipating a slight increase.”
For B2B organizations, the study found 12.3% of revenue will be allocated to marketing budgets to drive growth in 2017. The figures Gartner derived are more optimistic than The CMO Survey by Fuqua School of Business at Duke University found earlier this year.
That study, which I review in detail annually (see: The CMO Survey with Social & Mobile Marketing Takeaways) found B2B product and B2B service companies spend 6.9% and 8.6% of revenue on marketing respectively.
Don’t miss these useful posts:
How to Get the B2B Marketing Persona Right [UML]
Designing Deliberate Questions, Content and Customer Experiences [UML]
Influencer Relations: Magic Middle vs. the A-List
2) Thinking Differently about Marketing Budgets
In budget planning for the next year, last year’s budget serves as just one data point, according to Jocelyn Brown of Allocadia, which develops software for planning and measuring the results of marketing budgets.
In a piece for Chief Marketer called, How Leading CMOs are Planning Marketing Budgets for 2017, she writes:
“Many teams use results from the previous year to make data-driven assumptions about the expected results for programs they’re planning to run next year. Often their marketing planning involves taking last year’s plan and tweaking it, perhaps eliminating waste and identifying opportunities to double down. But last year, though informative and certainly a starting point, should not be the only influence on your upcoming plan.”
If marketing is to think differently about budgeting, I’d like to see businesses think about marketing too. Specifically, I’d like them to commit to the marketing budget. Too often by Q2 or Q3, businesses “challenge” marketing to save costs.
This usually means clawing back part of the budget and its very detrimental to the longer-term growth objectives. For example, if you take money out of your retirement investments today, you won’t obtain the cumulative gains over time. Similarly, marketing is also an investment and companies have to develop the organizational discipline to invest consistently despite the ups and downs.
3) Budgets for Influencer Marketing
Christopher Heine, the technology editor for Adweek summarized some of the findings in pieced titled 8 New Stats About Whether Influencer Marketing Campaigns Actually Work. The investment marketing is making in influencer marketing stood out to me:
“In 2016, most marketers spent between $25,000 and $50,000 per influencer marketing program.”
That number also appears set to increase:
“The survey respondents reported those figures will double to $50,000 to $100,000 per program next year.”
My cautionary tale for brands it that influencer marketing, despite the money, is still a relationship business. You can’t just throw money at influencer and expect results. Brands should treat influencers like they do agencies – as an extension of the team.
Note: The graphic above used with explicit Linqia permission.
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