Marketing budgets have risen to 9.5 percent of overall company revenue in 2022, an increase from 6.4 percent in 2021, according to Gartner’s annual 2022 CMO Spend and Strategy Survey.
Seventy percent of respondents reported their budgets had increased this year, however they still lag pre-pandemic spending levels when the average budget between 2018 and 2020 was just under 11 percent.
Digital Accounts For 56 Percent Of Marketing Spend, But Offline Channels Rebound
Chief marketing officers have transitioned from digital-first to hybrid multichannel strategies. When asked to report the proportion of their 2022 budget allocated to online and offline channels, respondents said online channels hold 56 percent while offline channels hold 44 percent of the available budget. This split is more equitable than in recent years, Gartner found. In terms of the average spend across industries, social advertising is first, followed by paid search and digital display.
“Post-lockdown, CMOs need to listen carefully to their customers and pay attention to the channels they are using, as this more closely resembles a hybrid reality,” said Ewan McIntyre, chief of research and vice president analyst in the Gartner for Marketing Leaders practice.
Marketing Spend Is Increasing Across Nearly All Industries
Average marketing spend has grown across eight out of the nine industries included in Gartner’s survey. Financial services companies have the highest budget at 10.4 percent of company revenue—up from the second-highest budget in 2021 of 7.4 percent.
Travel and hospitality and tech products tied for second-highest budgets this year at just over 10 percent of company revenue—almost double what each allocated in 2021.
Although almost all industries’ budgets increased, spending for CMOs at consumer goods firms has decreased somewhat, dropping from 8.3 percent in 2021 to 8 percent in 2022.
CMOs Confident On Brand Capabilities, But 58 Percent Lack In-House Resources
Brand was ranked as one of the lowest capability gaps, reflecting CMOs’ confidence in their capacities to manage. In fact, brand strategy and activation are near the top of the list of budget allocations across marketing’s program and operational areas, accounting for roughly 10 percent of the budget.
Nevertheless, as Gartner notes, other strategic capabilities gaps remain—marketing data and analytics were cited by 26 percent of CMOs as a top capability gap, followed by customer understanding and experience management (23 percent) and marketing technology (22 percent).
These points reveal a larger resource challenge for CMOs, with 58 percent reporting that their teams are incapable of delivering their strategy.
Gartner’s findings are based on a survey of 405 chief marketing officers and leaders in North America and countries in Northern and Western Europe. The survey was conducted between February and March 2022 and included marketing professionals from different industries at companies with varying sizes and revenues, with the majority reporting annual revenue of at least $1 billion.