In the early days of the pandemic, CMOs in the US predicted that they would up their spending on customer relationship management more than they would their spending on brand building, as retention became a key priority. As the pandemic has waned, though, brand building budget expectations have taken over, according to the latest edition [pdf] of The CMO Survey.
The latest research indicates that CMOs expect to increase their brand building budgets by almost double-digits (+9.6%) in the coming year. Though that’s a slightly more modest projection than from earlier this year (they expected an 11.8% hike in February), it’s slightly above the 9.1% boost they predicted around this time last year.
Moreover, there’s been a clear shift in budget expectations relative to CRM spend. This most recent survey finds that CMOs plan to expand their spending on customer relationship management by 6.8% in the coming year, trailing the expectations for brand building spending. This latest projection for CRM spend growth is also down from early this year (+9.5%) while also dipping slightly from the same survey conducted around this time last year (+7.2% at the time).
The results come amidst an environment in which marketers around the world have set their sights on brand building, with this emerging as the number 1 priority for marketers in a recent study. Powering the projection for brand building spending are B2C product companies, who foresee an 11.4% increase in spending in this area in the coming year. It may be B2B companies that might need it more, though: a new study shows that brand building gets less a third of marketing budgets at B2B companies.
Brand building priorities may be influenced by inflationary pressures also. Some marketers responding to The CMO Survey note that they are needing to make stronger brand building investments as a result of inflationary pressures and higher prices.
Overall, inflation is having a negative impact on marketing spending: 42% of marketers said that it is leading to decreased spending levels, more than double the share who said it has led to increased spending (17%). The remaining 41% cite no impact from inflationary pressures.
Separately, the easing of the pandemic may also be resulting in a leveling out of marketing’s importance. Early last year a high of 72% of CMOs surveys said that the role of marketing in their company had increased in the previous, COVID-ravaged, year. Fast forward to February of this year and a slightly smaller share (68%) said the same, while in this latest survey that figure has dropped to 60%.
For more, check out the study here.
About the Data: The results are based on a survey of 273 marketers at US for-profit companies, 95.6% of whom are VP-level or above.
