Gartner’s 2013 US Digital Marketing Spending Report, a survey of over 200 marketers from U.S.-based companies with more than $500 million in annual revenue, provides some useful insight into what larger corporations are spending their marketing dollars on. The companies in the Gartner survey spent, on average, 10.4% of their annual 2012 revenue on overall marketing, and 2.5% on digital. As businesses continue to shift resources to digital, a number of trends are emerging that will define the future of marketing. Here are 5 insights from Gartner’s report that virtually any-sized business can use to help shape its digital strategy.
Digital Merges with Traditional Marketing
The main driver of corporate adoption of digital marketing is the consumer adoption of digital- specifically, the shift to communicating and buying through digital channels. As consumers continue to embrace the Internet, social, and mobile, companies are scrambling to beef up their online presence, spending on external marketing services such as search, web design, content creation and management, social media, and mobile marketing.
According to the survey, 28% of marketers say they've reduced their traditional advertising budget to fund digital marketing activities. This is especially true among high-tech companies, where 34% have done as much. Many companies are not reallocating traditional budgets to digital, but simply merging the two together. A significant number (20%) of companies surveyed have already integrated digital and traditional marketing budgets and functions.
A big reason marketing execs are shifting to digital is that it is proving to be more cost effective than traditional marketing. Fully 40% of marketers acknowledge they are realizing savings from digital marketing; many are reinvesting these savings into more digital marketing.
Content Fuels Inbound Marketing
Recognizing the utility of inbound marketing channels such as social networks, customer forums, and web-based blogs, marketers are spending heavily on inbound and on the content that fuels it. As marketing automation technologies grow in sophistication, marketers are expected to deliver content that speaks to each element of the company’s target audience in just the right place at just the right time.
As consumers continue to integrate digital into their daily lives, the demand for multi-channel content marketing will grow apace, putting more pressure on marketing organizations to deliver greater amounts of high-quality content.
Companies are Outsourcing their Digital Marketing
Given the increased demand for inbound marketing and content creation, coupled with the rapid pace of technological change, many companies are opting to outsource some, if not all, of their digital marketing. In fact, the companies in the Gartner survey are outsourcing up to 50% of all digital marketing activities.
Here’s a breakdown:
Website, Social, and Digital Advertising Most Effective
When asked which three digital marketing activities are most important to their success, the marketers surveyed listed a corporate website, digital advertising, and a presence on social media. Not surprisingly, web optimization is top of mind for most marketers, as they experiment with customized landing pages and different types of marketing content.
Interestingly, only 9% of survey respondents said that analytics is most important to their success. The disparity between content creation and the maintenance of a corporate blog is also noteworthy. Answers like these remind us that we’re still in the early days of digital marketing.
The Rise of the Chief Marketing Technologist
The technological complexity of digital marketing has created a need for a new type of marketing leader, the Chief Marketing Technologist (CMT). Somewhat surprisingly, 70% of companies in the Gartner survey have a CMT; 80% of them report to marketing. As one might expect, the CMT is familiar with marketing techniques and the technologies that underpin them, including marketing software, data, and analytics, social and mobile platforms, digital advertising networks, and website design.
As businesses become more dependent on technology to attract, acquire, and retain customers, they must have digital marketing leadership who knows how to design the customer experience across web, social and mobile, integrate data into the decision-making process, and manage paid and organic search, social, mobile marketing campaigns.
The Bottom Line
The rapid pace of technological innovation will continue to drive the shift to digital marketing. As SMBs struggle to figure out how best to adopt digital, they can glean insight from bigger corporations. Here are a few takeaways:
- Understand the importance of establishing and maintaining a digital presence, which includes a fully optimized business website, active profiles on the relevant social media channels, and a seamless user experience across web, social, and mobile. Make sure you have the appropriate marketing technologies in place to measure results. Apply lessons learned to constantly refine your digital marketing.
- Put together a digital marketing team who is adept at doing all of the above. If you don’t have the internal talent or resources, outsource to a company that specializes in integrated digital marketing.
- Stay in the loop. Keep tracking emerging digital trends, especially those relevant to your target audience. Remain abreast of the latest marketing technologies, analyzing how they can help improve your digital marketing efforts.