IDC: Tech marketer budgets up 3.7%

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The technology industry is bouncing back from the recession, with tech marketers projected to increase their marketing budgets 3.7% this year over last year, according to research company IDC.

That's a healthy change from last year, when technology companies slashed their marketing budgets 8.3%.

The findings are part of IDC's recently released “2010 Tech Marketing Benchmark” study, which was based on an online and telephone survey of 87 senior technology marketers, conducted between May and July.

However, while tech marketing investment is up this year, it lags behind growth in global technology revenue, which IDC projects will be up 5.8% this year. Last year, global tech revenue fell 4.5%.

“We had a better-than-expected first half, but over the last three months we've all been worrying that there might be another dip to the recession. Many tech vendors are behind the curve in their marketing investment,” said Rich Vancil, VP-CMO Advisory Service at IDC. “I like to see marketing investment at or above revenue growth.”

Vancil noted that the recession has caused marketers to shift more of their budget to lower-cost digital marketing.

This year, tech companies will allocate 19.3% of their total marketing budget to digital, up from 12.6% last year. Within digital marketing, the largest share of the budget will go toward company websites (26.7%), followed by display ads (21.0%), e-mail marketing (18.6%), search ads (13.6%), search engine optimization (7.6%), digital events (7.1%) and social networks (5.4%).

Traditional advertising, including TV, print, out-of-home and sponsorships, has dropped to 11.9% of the total marketing mix this year from 20.9% last year.

“These are very dramatic changes to the marketing mix, and this is permanent,” Vancil said. “The recession has brought these changes, and we are not going back to the past. This sets the tone going forward.”

Marketers will spend the largest share of their budget this year on events (20.2%), up from 17.2% last year. They will spend 19.0% on marketing support materials, compared with 17.8% last year.

IDC also asked tech marketers what their primary go-to-market orientation is this year. The top response was product line (25.1%), followed by customer segment (19.6%), solution (16.4%), campaign or theme (16.0%), industry (15.8%), job role (5.8%) and other (1.3%).

“The marketing orientation is quite mixed,” Vancil said. “Then to add to the complexity, the channels are expanding. There are a lot of marketing decisions to make as we decide how to get the message in the right format and in the right shape to the person we are targeting. It is a very complex issue for marketers and salespeople.”

Vancil said that in time, tech marketing will get much more personal. “The path toward personalization starts with centralization and consolidation of marketing processes, tools and content,” he said. “We are getting more personalized with information about the customer, but we are getting more centralized in the creation of that content.”

He pointed to Hewlett-Packard Co.'s enterprise business, which is centralizing its content creation and moving it from the field to corporate marketing.

“In the past, 90% of their content creation was in the field, but now only 20% of it is in the field,” he said. “We all have to think about greater centralization and consolidation of tools.”

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