Digital Shift in Marketing Budgets

According to a recent Econsultancy survey, conducted in association with ExactTarget of more than 1,000 marketers, the shift of marketing budgets from traditional channels to digital channels will continue to rise in 2010. 46% of companies plan to increase their marketing budgets in 2010, says the study, and 66% will increase their investments in digital marketing channels. A crosstab analysis on the changes in overall budgets compared to changes in digital budgets shows that 28% of marketers are shifting at least some of their overall marketing budgets from traditional to digital channels, says the report.

Plan To Increase Marketing Budgets In 2010


Overall Budget

Digital Budget

Increase budget



Keep the same



Decrease budget



Source: Marketing Budgets 2010: Effectiveness, Measurements and Allocation Report, ExactTarget, February 2010

Highlights from the marketing budgets 2010 study, as shown in the study report:

1. 28% of marketers are shifting at least some of their overall marketing bud­gets from traditional to digital channels:

  • At least part of the reason for the shift to digital marketing is that marketers find it easier to track the impact these channels have on hard financial metrics. Marketers tend to take a more "scientific" approach to their allocation of digital marketing budgets than they do when allocating traditional marketing budgets. 34% of marketers said digital marketing budgets are allocated based on "more science than art" compared to only 20% who allocate traditional marketing budgets based on "more science than art."

2. Marketers who focus on "brand reputa­tion" as a measure of marketing ef­fectiveness are the most likely to be shifting budgets from traditional to digital channels:

  • Marketers who focus on this metric are more likely to be increasing their investments in social media such as Facebook and Twitter. They're also more likely to be increasing investments in online display and mobile marketing, and less likely to be increasing investments in Search Engine Optimization (SEO), affiliate marketing, and acquisition-based email (i.e. email to rented lists). These increased investments in retention-based email marketing (i.e. email to registered customers) is on par with other marketers.

3. Marketers have the most difficulty measuring ROI in social media and mobile marketing:

  • Ironically, says the report, these channels are most likely to get budget increases in 2010, despite marketers' inability to measure the effectiveness of this emerging media. The study found that the ability to measure ROI is not the primary factor in budget increases across digital channels. But while 34% of marketers plan to increase paid search budgets in 2010, 13% will decrease spending in this area.

4. 64% of marketers plan to increase SEO budgets while 54% will increase retention email marketing budgets. Only 3% of marketers plan to decrease budgets in each of these areas:

  • The majority of marketers are able to effectively measure these established digital marketing channels. When it comes to digital marketing budgets, marketers feel confident increasing their investments when efforts can be linked directly to their bottom line.

5. In addition to examining how marketers plan to allocate their marketing dollars in 2010, this study also highlights some of the challenges that exist in digital marketing:

  • While company respondents cite restricted budgets (40%) as the biggest barrier to additional digital marketing investments, agency respondents cite lack of understanding about digital marketing (48%) as the biggest impediment to growth.

6. Lack of staff to make the most of any digital investment was cited by 35% of both company and agency respondents as an additional barrier:

  • While marketers are increasingly optimistic about the opportunities digital channels provide, lack of training may limit an organization's ability to take full advantage of these opportunities. One respondent report that, "with the last year being tough financially, training and investment have been cut."

Additional budgeting highlights:

  • 70% of responding companies plan to increase their budgets for off-site social media (i.e. Facebook, Twitter)
  • Only 17% of respondents are increasing their print media budgets, compared to 41% who are decreasing spending. 15% of companies are increasing their radio budgets, but 36% are spending less
  • More than half of companies plan to increase their budgets for mobile marketing (56%), email marketing (54%), and paid search (51%)

Please visit Econsultancy here for additional information and access to the complete report.

3 comments about "Digital Shift in Marketing Budgets".
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  1. Roger Wood from Coldwell Banker Gundaker, February 10, 2010 at 11:57 a.m.

    This article contain contains information that is insightful and an indicator of the value of the medium.

  2. David Manno from Giovatto Advertising, February 10, 2010 at 12:18 p.m.

    Insightful as well as accurate in my experience with current
    marketing trends. For direct response ROI versus pure branding the needle is moving towards digital but perhaps
    a little slower. It's nice to see a article that confirms what
    is happening with measurable proof.

  3. Fred Jones, February 10, 2010 at 2:11 p.m.

    Good read, but how can #1 say "marketers find it easier to track the impact these channels have on hard financial metrics" and then #3 say "Marketers have the most difficulty measuring ROI in social media and mobile marketing" ?????

    Doesn't that just mean that it costs less, but measuring effectivness is anecdotal at best?

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