State of marketing budgets and strategic priorities

Sometimes it’s a good idea to down tools, come up for air, and see what is happening with marketing leaders. Are they facing similar challenges as me?

So when I saw the recent Gartner webinar: The Gartner CMO Spend and Strategy Survey 2024: Refocus Your Marketing Priorities, I thought I could learn some insights into marketing budget and ROI challenges that never seem to go away.

Even though the presenter looked like he was being held hostage in the video, I really enjoyed the key takeaways from the content:

Marketing budgets are down

The average marketing budget has decreased since 2019, with the 2024 marketing budget as a percentage of total revenue falling to a low of 7.7%.

This is a significant reduction from the pre-pandemic average of 11%. It was also fascinating to learn that B2C is doing it tougher than B2B in 2024.

Challenges and priorities

Marketing leaders face significant budgetary and strategic hurdles in 2024 – due to inflation, ROI pressures, and interest rates.

Almost half of the CMOs report that marketing is now viewed as a cost centre, with 73% indicating that they lack the necessary budget to successfully execute their current marketing strategy. This would be seen in marketing team burn out.

Managing a constrained budget

There were 3 actions recommended, which I’m guessing are already in play:

• • Prioritising productivity by focusing on efficient use of resources (agencies, media, technology, people)
  • Building a growth-first marketing value case to justify and secure necessary budget allocations.
  • Identifying and addressing any fiscal hurdles to ensure effective budget management​

Allocation of resources

Priorities are changing when it comes to the resource mix. It’s interesting that media is the most productive source of growth, with a large portion of budgets allocated to media and digital channels.

Digital channels now account for 57.1% of the marketing budget, highlighting the ongoing focus on digital marketing strategies. It was also interesting to note the channels delivering impact based on spend.

Capability gaps

It is not surprising that the largest gaps in marketing capabilities are in personalisation, multichannel marketing, and customer journey coordination.

The software to deliver on these tends to be expensive, and the know-how to plan, build and executive needs marketing operations skills.

Artificial Intelligence tools and martech

The magic unicorn to save the day! As the flavour of the year, AI continues to receive significant focus and investment, with more than 75% of CMOs expressing high hopes for AI’s impact on marketing.

However, many are finding out first hand that there are challenges with declining tech utilisation and leadership in martech. Just having the tools doesn’t mean effectively benefitting from the tools. However, I almost like the idea that other business departments, like IT, are also funding martech.