Advertising, Content Eat Up Biggest Share of Digital Marketing Budgets

Source: March 14, 2013 by MarketingCharts staff

Gartner-Digital-Marketing-Budget-Mix-in-2012-Mar2013

Marketers from companies with more than $500 million in annual revenue are devoting the largest portion of their digital marketing budgets to digital or online advertising (12.5%) and content creation and management (11.6%), per survey results from a Gartner report. Those results reflect the ongoing growth of online ad spend in the US, as well as the continued rise in importance of content marketing. The study also finds that 28% of respondents reduced their traditional advertising budget to fund digital marketing activities, a finding supported by various pieces of research showing such a shift in the media mix. Still, a plurality 41% of respondents say that they are funding their digital marketing activities through the savings they are getting from using digital as opposed to traditional marketing.

Meanwhile, other activities that are getting a healthy share of digital marketing budgets include search marketing (including paid search; 10.7%), email marketing (9.6%), analytics (9.5%), and social media marketing (9.4%). CMOs recently projected that social media accounts for 8.4% of their entire marketing budgets, emblematic of a generally bullish outlook they hold on social marketing.

When it comes to the digital activities that contribute most to their success, respondents to the Gartner survey were most likely to tab corporate websites and online advertising (each at 18%) as their most effective activities, followed by commerce experiences (12%) and email marketing (10%). While social media marketing did not get many first-place votes (6%), 43% tabbed this activity as among their top-3 most effective, tying it with online advertising, just behind the corporate website.

Other Findings:

  • Companies spent 10.4% of their 2012 revenues on marketing activities, including salaries, and traditional and digital marketing costs.
  • Digital marketing spending averaged 2.5% of company revenue, and 25% of marketing budgets overall.
  • Respondents estimate that 50% of their search marketing is outsourced. Online advertising (46%) and mobile marketing (45%) are also being heavily outsourced.
  • 7 in 10 companies have a chief marketing technologist, and 80% of those report to marketing.

About the Data: Gartner’s U.S. Digital Marketing Spending report is based on a survey of 253 marketers from U.S.-based companies with more than $500 million in annual revenue (average revenue $5 billion). Respondents were from six industries: Financial services and insurance, high-tech, manufacturing, media, retail, and healthcare. The survey took place in November and December 2012.

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