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August 21, 2021

The Gartner CMO Spend Survey shows that marketing budgets dropped from 11% of revenue in 2020 to 6.4% in 2021, causing a cascading ripple in how chief marketing officers (CMOs) are prioritizing spend across the organization. Faced with a reduction in resources, CMOs have reprioritized marketing channel spend for 2021. Now, pure-play digital channels dominate, making up 72.2% of the total marketing budget.

The State of Marketing Budgets in 2021: Insights From Gartner’s Annual CMO Spend Survey revealed seven key shifts in marketing channel spend:

  1.     CMOs across industry segments have shifted focus to performance marketing channels, increasing spend on social marketing, digital advertising (such as video and display) and SEO.
  2.     Awareness-based channels such as offline advertising and mobile and event marketing have taken the largest hit when it comes to marketing channel spend.
  3.     B2B marketing leaders have shifted focus to social, mobile and SEO, with 53% increasing investments in social marketing. Meanwhile, 40% have decreased investments in event marketing, and 36% have decreased spend on digital advertising.
  4.     The percentage of B2B marketing budget allocated to digital advertising dropped 2.8 percentage points from 2021, while the portion going to paid search increased 2 percentage points.
  5.     B2C marketing leaders, on the other hand, have increased spend on digital advertising (48%) as well as SEO (47%), but have decreased investments in offline advertising (43%) and mobile (35%).
  6.     B2C CMOs slashed event marketing spend by nearly a full percentage point, reflecting the residual impact of travel limits during the pandemic and a hesitancy to go back to in-person events in 2021. On the other hand, they increased investments in email marketing from 8.8% in 2020 to 10.1% in 2021.
  7.     At B2B/B2C hybrid companies — those with both business and consumer sales — the percentage of marketing budget allocated to digital advertising dropped 4.3 percentage points in 2020 while spend on social rose 2.2 percentage points.

 

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