Distribution of marketing budgets this year will change, according to the results from a survey released today from Wunderkind, a digital marketing platform.
Some 44% of those participating in the survey said performance marketing budgets will increase, while 41% said budgets will remain the same, and 15% cited a decrease.
Technology budgets also will change, with 39% of marketers surveyed saying they will increase, while half said they will remain the same, and 11% said they will decrease budgets.
Wunderkind based the report -- The 2023 CMO State of the Union -- on an online survey of 100 marketing executives in retail, all of which were director-level and above.
Some 88% of those surveyed work in organizations with between $10 million and $99.99 million in revenue, and 80% manage an annual marketing budget of $1 million to $25 million. It's not clear exactly when the survey was conducted.
Why will budgets change? Some 59% of respondents said digital advertising was not improving customer knowledge, while 50% agreed that ads were not increasing brand loyalty, and 44% acknowledged ads were not increasing sales.
Areas where digital advertising is failing to help teams meet goals vary. Some 59% of respondents cited customer knowledge, while 50% cited brand loyalty, 44% cited sales, 32% cited customer service, and 13% cited new audiences.
Half of survey participates cited an increase in profits as the highest priority this year, followed by 39% who said they want an increase in website traffic. About 38% are looking for an increase in return customers, while 35% said they are looking for an increase in revenue, 15% cited higher average order value, and 8% are looking for higher return on investment for ad spend.
Marketers have many challenges this year. Most recently, the downgrade of the United States' long-term credit rating based on the country's deteriorating fiscal position, a steady deterioration in standards of governance, and the nation's high and escalating debt. The impact this will have on the advertising industry has not yet been determined.
The marketers who spoke with Search & Performance Marketing Daily said the outcome of the downgrade will mostly depend on consumer spending.
The results -- detailed in this report -- were determined earlier this year from May to June, prior to the downgrade.
The data provides a glimpse into how participating marketing leaders prioritize significant shifts, along with insights on the most significant struggles they face and plans to approach performance marketing.
As for marketers, most of their budgets will go toward Google -- at 23.1%, respondents said -- while 19.1% of budgets will go to Facebook, 12.6% will go to Pinterest, 11.8% to Snapchat, 11.7% to TikTok, 11.2% to connected TV and video, and 106% to video.
Inadequate technology stacks could hinder results. When asked which part of their tech stack is not driving results, 63% of respondents cited customer data platforms, while 51% cited customer relationship management software, 45% cited marketing automation platforms, and 43% cited content management systems. Other systems cited included email service providers, website analytics, text-messaging provider, and marketing cloud provider.
Some 65% of respondents cite “not enough budget” as having a medium or large effect on their paid--ad strategy. To justify their spending, marketing leaders are responsible for educating their C-suite executives on the importance of increasing the budget to optimize performance and return on investments (ROIs).
Some 40% of marketing leaders surveyed said they are having more meetings than last year with their finance departments. As the cost of ads increases and their effectiveness decreases, marketers are finding it more difficult to justify the budget needed to run successful ad campaigns.