Marketing Technology for Growth

Why Budgets are Shifting to Digital Marketing

why budgets are shifting to digital marketingAs the world moves online, digital marketing principles are being adopted everywhere. Even the staunchest names in traditional media are getting hip with the times. As reported in TechCrunch, Hearst Digital Media is planning on incorporating personalization and responsive design into its new publishing platform. To adjust to this new reality, businesses are shifting marketing budgets accordingly. This point is underscored by data from Econsultancy’s Marketing Budgets 2013 Report sponsored by Responsys. The survey of over 800 company and agency marketers found that 71% are increasing their digital marketing budgets for 2013, while only 20% are increasing their traditional (offline) marketing budgets. Moreover, of the companies increasing their digital marketing budgets, 56% are raising them by more than 20%. On average, the companies surveyed are spending 35% of their total marketing budgets on digital. Why are they doing so? Because digital marketing works. According to the Report, over two-thirds of companies surveyed are driving over half their revenues from digital marketing spend.


The shift to digital marketing is largely consumer driven, as technologies such as the Internet, social media, and mobile devices empower them to demand more out of brands and marketers. Consumers want what they want when and where they want it, expecting simplicity, convenience, and real-time, personalized interaction with brands over multiple digital channels. To compete, businesses face a devil’s bargain: on the one hand, they are expected to participate in numerous granular interactions to foster long-term relationships with each disparate segment of their target audience; on the other, they must deftly mine vast troves of data to measure the ROI of these interactions.

To efficiently navigate such Herculean demands, businesses are becoming more reliant on integrated digital marketing.


For the marketers surveyed in the Report, content is king, as 70% of company marketers and 72% of agency marketers plan on raising their content marketing budgets. Interestingly, 65% of company marketers are spending more on organic SEO, this in spite of concerns over its measurability in the face of increasing HTTPS encryption on the part of Google. Allocation in social media and email marketing, for both engagement/retention and acquisition remain strong, as does spending on mobile marketing. Other popular digital marketing investments include lead generation, video advertising, PPC, and webinars.

Evidencing the pervasive role of technology in marketing, the Report lists a host of digital marketing technologies used by the marketers surveyed; the three most popular are business analytics and web analytics software (46%), CRMs (45%), and content management systems (41%). In addition to these, the survey respondents are turning to various other marketing technologies, such as social media management systems, paid search/bid management and ad retargeting systems, to help measure digital marketing ROI.


The complexity of the emerging digital marketing landscape requires a new set of interdisciplinary skills that are hard to find. The Econsultancy Report cited a recent IBM study relating that across the four technology areas they explored – mobile, business analytics, cloud and social business – only one in ten organizations has all the skills it needs.

This skills gap has led to an interesting paradox: many companies are reluctant to invest in digital marketing because they lack the human capital to maximize the value of the investment. Indeed, the pace of change in various digital marketing technologies is likely exacerbating this trend.

On a practical level, highly complex and fully integrated digital marketing campaigns require adaptable personalities who perform well in environments of constant change, uncertainty, and downright chaos.

From my experience in the digital marketing trenches, the best teams are made up of cross-functional individuals each with some combination of the following attributes or skills:

Creativity (perhaps more important than ever); excellent verbal/writing skills; graphic design; web development and front-end design; statistics and data analytics; project/process management; digital proclivity; critical thinking; intuition and perspective.

Much like an elite special forces unit, an elite integrated digital marketing team is made up of small packs of highly trained and talented individuals. Given the difficulties associated with hiring and maintaining such talent, many companies are finding it more cost-effective to outsource some or all of their digital marketing to specialized groups.


According to the Report, digital marketing is all about lead generation and customer acquisition and retention by way of engagement over website, email, social, and mobile channels. Don’t believe me? Check out this handy Wordle of most common survey responses to the question, “What is the single most important area of digital focus for your organization / clients in 2013?”

the single most important area of digital focus mobile content social

In this case, a picture truly is worth a thousand words.


Field Guide to SoLoMo

Topics: Integrated Digital Marketing