CMOs face tough budget choices as marketing enters era of efficiency
By Felicia Nwosu
Gartner, a Management Research & Consulting company’s research, has revealed that marketing budgets in 2024 have entered an era where growth is no longer assured but must be actively earned. According to Gartner’s CMO Spend Survey, only 24% of Chief Marketing Officers (CMOs) believe they have sufficient resources to implement their strategies for the year.
The study highlights a significant reduction in marketing budgets, which have decreased from an average of 9.1% of company revenue in 2023 to 7.7% in 2024, marking a 15% year-over-year drop.
“Marketing budgets have contracted from an average of 9.1% of company revenue in 2023 to 7.7% in 2024, a sharp 15% reduction year over year. This decline continues a pattern of financial tightening that began during the COVID-19 pandemic, which saw marketing budgets slashed by over 40% in a single year. Although there was some recovery in 2022, budgets have yet to return to pre-pandemic levels, with a nearly three percentage point difference between the years preceding and following the pandemic.”
The findings stated that in this challenging landscape, CMOs are expected to achieve more with fewer resources, signaling that the focus has shifted to making strategic investments that yield the highest possible returns.
It categorically indicated that CMOs must now identify the areas where reduced spending can still drive significant value, understanding the potential impact of their decisions. As technological advancements, particularly in AI, continue to disrupt the marketing landscape, successful CMOs will need to embrace these changes, refine their marketing strategies, and enhance cross-functional collaboration to sustain growth and underscore the value of marketing within their organizations.
Gartner in its research also underscored that despite the challenges posed by economic and societal disruptions, the fundamental elements of effective leadership remain crucial, urging that CMOs must maintain strategic clarity aligned with their organization’s vision, build strong executive relationships to secure ongoing support, and lead their teams with confidence.
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