Marketing budget: marketers increasingly spend on marketing technology

Robbe Desmyttere
March 14, 2019
⏱ 2 min. read

Great news for marketers: the budget they receive is no longer decreasing. A positive wind is blowing through the marketing landscape. Strikingly, marketers spend less on workers, paid media and marketing agencies. Almost one-third of the marketing budget goes to marketing technology.

In Gartner’s CMO Spend Survey 2018-19, 600 marketing professionals in North America and the United Kingdom completed a survey about their budgets. That survey examined both how much they spend and where most of that budget goes. 

Martech is hot

Gartner's most important finding is that marketing technology was the biggest expenditure of CMOs in 2018. In 2017, Martech only took up 22% of the total budget. In 2018, this was 29%. Marketers spend more on technology than on workers, paid media and marketing agencies. Top of the list is email marketing platforms (such as MailChimp), web content management and digital marketing analytics platforms. 

The distribution of the marketing budget across different channels. (Source: Gartner)

It shows that marketing technology is no longer in its infancy. The role of digital marketing will only increase in the coming years, and the number of tools that a marketer uses for the execution is on the rise. 

An overview of the marketing technology landscape, created in 2017. (Source: Chiefmartec.com)

Positivity is key

In 2016, the marketing department received 12.1% of the company's turnover on average for their budget. The following year, the figure dropped to 11.3%. The main reason for this substantial decrease is the vague link between marketing expenditures and ROI. The marketing department remains bottom of the class when it comes to linking expenses to revenue. Too often, campaigns get set up, while the results are known to be difficult to measure. However, times they are a-changin'.

Recent developments show that marketing is becoming more and more measurable. Especially when we enter the digital domain, marketing becomes exceptionally measurable. That's great news for marketers. Providing clear figures that demonstrate the success of your marketing plan is guaranteed to result in management recognition.

As a result of this positive evolution, the marketing budget did not, or hardly, decrease any further (from 11.3% in 2017 to 11.2% in 2018). However, we are not yet at the level of 2016. Winning back the budget is not easy, but CMOs are optimistic. About two-thirds of the marketers surveyed believed that their budget would increase in 2019. 

It is imperative as a marketer to determine in advance with which budget you will achieve which results. If you do it right, not only reporting but also the insight into past, current and future projects becomes way easier.

The European marketer

The fact that only marketers from Anglo-Saxon countries were interviewed, immediately makes us more mindful to generalisations. In those countries, the marketer often focuses on something completely different than in Europe.

A recent Hubspot study on the use of inbound marketing showed that European marketers mainly focus on growing the top of the marketing funnel (think of creating brand awareness and generating leads), while American marketers focus more on nurturing their leads. This difference indirectly results in a different allocation and use of the marketing budget. Therefore, European marketers also use other tools than Anglo-Saxon marketers. 

This graph shows the difference in focus between the European and American marketers. (Source: Hubspot)

However, the biggest challenge for marketers remains the strategic deployment of the right marketing technology. There is still too much experimentation with a wide range of tools, without necessarily finding the right fit. 

In a later article, I will dig deeper into the tools that I, as a digital marketer at Husky, use every day. Read it now.

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