Top 5 Lessons From Marketing Leaders in 2018

January 3, 2018
Contributor: Chris Pemberton

Use these key take-aways from the CMO spend and strategy surveys to inform your 2018 martech and budget planning.

Although the topline story of the 2017-2018 Gartner CMO Spend Survey was that marketing budgets retreated from their highs in 2015, a deeper analysis of survey responses indicates that a sizable majority of leading marketing organizations are gearing up to increase their budgets. In fact, CMOs with added responsibilities (leaders) have greater immunity to budget cuts than their counterparts with limited authority (laggards).

“More than 75% of the CMOs in the leaders’ category with advanced responsibilities expect their marketing budgets to increase in 2018.”

In the Gartner report, Survey Analysis: What Marketers Learn From Leading CMOs and Their 2018 Spending PrioritiesGartner for Marketers Principal Analyst Anna Maria Virzi highlighted key insights that marketers across all industries, sizes and maturity levels can use to prioritize their 2018 spending. Virzi and her team analyzed data from the CMO Spend Survey 2017-2018 and the CMO Strategy Survey 2017 to categorize survey respondents into three groups based on the scope of their responsibilities:

  • Leaders are solely responsible for all multichannel activity, along with the automation, analysis and multichannel execution against customer behavior.
  • Learners are responsible for multichannel strategy execution and detecting/responding to customer behavior and demand.
  • Laggards have authority over multichannel promotion and content dissemination via traditional and digital channels or deliver communications and sales support only with little or no authority.

Below are key findings and recommendations.

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Changes in 2018 budgets will vary depending on the CMO’s responsibilities

Compared to previous years, the Gartner survey results revealed that marketing budget growth in 2017 stalled. However, more than 75% of the CMOs in the leaders’ category with advanced responsibilities expect their marketing budgets to increase in 2018. For 70% of the leaders with expected budget increases, the additional funds are expected to go to marketing analytics, customer intelligence or digital advertising in 2018.

Prioritize: Tie results to business goals, such as leads generated and conversion rates, to show impact and justify budget.

Leaders are more effective at managing martech

Laggards are struggling to manage martech more than marketing organizations with more responsibilities: 26% of lagging organizations say they are not effectively acquiring or using martech, compared with only 16% of the leader organizations that report ineffectiveness. The challenge is that these laggard organizations need to effectively deploy martech to catch up with more-savvy competitors.

“Leading CMOs tend to emphasize marketing analytics because they rely on data-driven acquisition tactics."

Prioritize: Perform a skills assessment. Even with the right technology, marketing teams will not realize the full value of the investment if the team lacks the skills to use it.

Leaders plan to accelerate martech spending in 2018

Nearly twice as many leaders (65%) as laggards (31%) plan to accelerate martech spending in 2018. Eighteen percent of leaders anticipate a significant martech spending increase and 47% expect a slight increase.

Prioritize: Develop a process to evaluate the acquisition of technology and audit the technologies your marketing organization already uses to determine who is using them and how much they cost.

Leading CMOs focus on the entire customer journey

Leaders focus on the entire customer journey, from acquisition to retention and growth, while laggards emphasize retention over acquisition. When it comes to acquiring customers, all CMOs recognize the importance of digital advertising and social media. However, leading CMOs tend to emphasize marketing analytics because they rely on data-driven acquisition tactics. Lagging marketing executives emphasize social marketing as a top tactic (likely for its low cost).

Prioritize: Build a strong data-driven marketing practice and educate peers at all levels about the role that customer experience plays in improving business results.

Leader and learner CMOs spend more on in-house staff

While leading and learner CMOs spend more on in-house staff than agencies, their lagging counterparts take the opposite approach. CMOs say they want to cut back on their use of agencies for strategy, preferring to limit agency engagements to tactical work and to fill program gaps. Leading CMOs are better equipped to actually execute on this because they spend an estimated 27% of their budget on in-house labor, slightly more than what’s budgeted for services, including agencies. Marketing organizations with fewer responsibilities, however, spend more with agencies than on in-house labor.

Prioritize: Invest in in-house staff to build key capabilities that can drive differentiation and create significant competitive advantage.

“Translate your vision for customer experience into a marketing plan that considers the data, technology and staff needed to execute,” says Virzi.

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