CMO Council report: Many budgets up

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The good news is: Almost one-third of global marketers plan to increase their marketing budgets this year, despite the recession, according to a new report from the Chief Marketing Officer Council. The bad news is: There is a disconnect between top management priorities and plans to implement programs and systems that would address some of them, the study found. The CMO Council's “Marketing Outlook 2009” report was based on an online survey of more than 650 global marketing executives, conducted from January through mid-March. It found that 50% of marketers plan to cut their budgets this year while 29% plan marketing budget increases and 21% will keep their budgets flat. “Everything we have seen and possibly predicted was that a typical knee-jerk reaction to the recession would happen—budgets would be slashed across the board and companies would look at marketing as if it were a line item that must be removed immediately,” said Liz Miller, VP-programs and operations at the CMO Council. “Not only are we seeing an increase in budgets, but there is also an increase in those programs and media options that will have an ROI that can be measured and provide direct engagement with customers.” When it comes to budget allocation this year, the largest program areas are database and direct marketing (with an average 16% of the marketing budget); sales collateral and literature (15%), trade shows and conferences (11%), print advertising (8%), online advertising (8%), search marketing (8%), and social media and viral marketing (7%). When asked which media programs would see an increase of more than 5%, marketers cited interactive/Web (33%), search marketing (25%) and social media (23%). “One of the most interesting findings is that there is a bit of a disconnect in where they are planning to spend,” Miller said. For example, while online media programs are clearly the priority at global companies, 44% of marketers said they lack the budgets to implement new media programs; 33% do not have the talent resources to manage new media; and 32% report limited understanding of new media solutions. “We are hoping that marketing gets really smart really fast about implementing some of these new media solutions,” Miller said. Another disconnect was found in senior management priorities and investment in programs and systems to achieve them. According to the survey, the top three executive mandates for this year are growing or retaining market share (48%), lowering costs and improving go-to-market efficiencies (44%), and improving customer insight and retention (33%). (Marketers could select more than one response.) However, only 17% of marketers are investing in an on-site CRM system this year; 13% are investing in marketing operations systems; and 10% are investing in master data management systems. “Senior marketers clearly need to elevate their game when it comes to integrating IT and data management into their operations and insights,” said Donovan Neale-May, executive director of the CMO Council. “At the same time, this year's study indicates senior marketers may be failing to build line of business and executive suite relationships required to build their status and influence in their organizations.” For example, only 8% of marketers plan to build new linkages with line of business executives; and just 7% are seeking positions on their corporate board. M
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