Gartner report: Martech tops CMO expenditure

Latest CMO Spend Survey also finds innovation a key priority despite a lack of skills and capabilities to support it

Marketing technology accounts for 30 per cent of the average modern marketing function’s budget, the largest single area of investment for CMOs, with a third going to services and support, according to fresh research from Gartner.

The analyst firm’s latest CMO Spend Survey 2018-2019 found martech spend was up 9 per cent year-on-year, making it the single biggest area of investment for marketers across resources and programs. It’s also coming at the expense of in-house labour, which fell 3 per cent year-on-year to 24 per cent in comparison. Agencies and paid media tied at 23 per cent each, also both down 2 per cent on 2017 figures.  

In a complementary study, Gartner found email marketing, Web content management and digital marketing analytics are top of the tech purchase list.  Nearly three in 10 marketers are also investing in social analytics or lead management platforms, and 28 per cent are deploying advanced analytics and data science tools.

What the report also revealed was more than one-third of this investment is going towards external services or IT cross charges.

“Though marketers are focusing investments on martech, the use of in-house labour and services provided by agencies and other marketing service providers accounts for almost half [47 per cent] of marketing budgets,” the report stated.

“The blurring of services and capabilities offered by different service providers results in resources being split across traditional agencies, consultants, in-house experts and a plethora of other players. This creates an organisational design headache and makes it difficult to determine how much is actually being invested in human capital, both within and outside the organisation.”

Related: Gartner: How CMOs will spend more on technology than CIOs in 2017

Not surprisingly, personalisation was a strategically important imperative for most of those surveyed, and CMOs are spending 14.2 per cent on average on their personalisation efforts today. Marketers are also spending 21 per cent of their marketing budgets on average on advertising, with two-thirds going to digital channels.

Another significant finding from the report was that 16 per cent of the marketing budget is being spent on innovation. Across respondents, 9 per cent of CMOs felt marketing innovation was going to be vital to delivering their company’s marketing strategy over the coming 12 months, and 63 per cent believe their innovation budgets will increase next 18 months.

This is despite doubts in the skills and capabilities available to support such programs, Gartner reported. For example, on a scale of 1 to 5 for marketing maturity, respondents came in at 2.2 for innovation maturity.

When it comes to skills, customer experience was nominated the top capability required in marketing teams this year, and marketers estimated 18 per cent of their overall marketing budgets are allocated to CX initiatives.

Another area still requiring improvement if marketing is to become more holistic is measurement. The 2018-2019 Spend Survey found ‘awareness’ was still the most important metric for respondents, beating ROI and measures of customer value and satisfaction.

Gartner’s report was based on a survey of 621 marketing executives at US and UK companies with at between US$500 million and $10 billion in annual revenue. Overall, marketing budgets came in at 11. 2 per cent of company revenue, on par with last year’s results.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu 

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

3 marketing mistakes to overcome when courting prospective customers

Marketing that urges respondents to ‘buy now’ is a little like asking someone to marry you on your first date. At any time, only 3 per cent of the market is looking for what you’re selling, so the chances of your date randomly being ‘The One’ is pretty slim.

Sabri Suby

Founder, King Kong

Why are we dubious about deep learning?

The prospect of deep learning gives those of us in the industry something to get really excited about, and something to be nervous about, at the same time.

Katja Forbes

Founder and chief, sfyte

Why you can’t afford to fail at CX in 2019

In 1976 Apple launched. The business would go on to change the game, setting the bar for customer experience (CX). Seamless customer experience and intuitive designs gave customers exactly what they wanted, making other service experiences pale in comparison.

Damian Kernahan

Founder and CEO, Proto Partners

Red Agency YouGov Galaxy Report, February 2019 Predictors Study. https://redagency.com.au/re...

Vanessa Skye Mitchell

DNA-based marketing: The next big thing?

Read more

RIP holden

Max Polding

Marketing professor: For Holden, brand nostalgia ain’t what it used to be

Read more

Where does the claim that 2 million Australians have tested come from ? Anecdotal information suggests that this is way off the mark.

David Andersen

DNA-based marketing: The next big thing?

Read more

Thank you for the info , being part of a digital marketing agency in kerala , this proved handy and get to know with upcoming trends. htt...

Dotz Web Technologies

Predictions: 9 digital marketing trends for 2019

Read more

So who then is correct? The Research or The skilled Digital people.

Anene

Report reveals Australia faces digital skills shortage

Read more

Latest Podcast

More podcasts

Sign in