Sales and Marketing Budgets will rise in 2010.

The International Data Corporation (IDC) Executive Advisory Group forecasts that IT vendor marketing budgets will increase by 3.7% and vendor sales budgets (investment) will rise by 5.6% for the full year 2010.

Richard Vancil, vice president of IDC’s Executive Advisory Group noted some key trends and offered guidance for the tech executives. “The recession has brought major changes to the level and shape of marketing investment. At the macro level, overall investment is likely to lag revenue growth this year and this is the first ‘watch-out’ for executives, as our research consistently shows that marketing leaders tend to keep budgets in-line with revenue growth. The second factor is the major shift in the shape of the marketing mix. Traditional media spending has declined by 43% this year, and the category of digital marketing has grown by 53%.

“These shifts were expected and our forecast accuracy from earlier this year was excellent. Now, the question for marketing and marketing-operations executives is: How do we adjust our execution and processes to adapt? IDC suggests two key steps. First, seek process improvement to address the complexity of multi-path marketing. Think about separate process paths for Waterfall versus Agile execution. Second, look for processes that will improve the capability for personalized marketing. It is counter-intuitive, but consolidation and centralization of marketing processes and IT will precede the ability to de-centralize and personalize. The top marketers are putting more intelligence and process in place at corporate to make this happen.”

The IDC Executive Advisory Group has also expanded its benchmarking research for Sales Productivity improvements. Noting that the average cost to create a B2B customer is about 14% of revenue, Vancil noted that “Selling expenses are nearly 80% of this total and so are a huge target for cost control and effectiveness improvements.”

Michael Gerard, vice president of IDC’s Sales Advisory Service, offers three guidance imperatives for 2011, for Sales executives. “First and foremost, upgrade your Sales Operations function. This role is quickly becoming more strategic and will be the key lead role in productivity improvements. The second area is to better equip the knowledge of sales reps as they prepare for account interaction. This includes account knowledge, competitive intelligence, and product knowledge. At most companies, these are all lacking. Finally, Sales execs should continue to invest in and deploy the automation tools to help with process improvement. Many are struggling with overcoming their deployments of first generation CRM and SFA tools, and this is now a significant impediment.”

For more information at http://www.idc.com