The events of 2020 have shone a light on the importance of digital marketing, with most companies continuing on with their digital marketing transformation during the pandemic, and some even accelerating their efforts because of it. But, has digital marketing made a significant contribution to companies’ performance during the crisis? Per a recent report [pdf] from The CMO Survey, the answer is a resounding “yes.”
The survey of more than 350 marketers — most of which were VP-level and above — asked respondents to rate, on a scale of 1-7 (1=not at all, 7=very high), to what degree the use of digital marketing contributed to their company’s performance last year. The majority (57.7%) were more than pleased with digital marketing’s contribution, rating it either a 6 (24.2%) or 7 (32.5%). Only a small share rated digital marketing’s contribution poorly, giving it a 1 (1.5%) or 2 (4.5%).
Indeed, respondents report that digital marketing’s contribution to performance increased by an average of almost a third over the past year. The improvement was even higher among companies with more than 10% of sales attributed to internet sales.
Level of Expertise Increases
Even though digital marketers still face the challenge of hiring the right talent, the senior marketers surveyed for this report indicate that levels of digital marketing knowledge and skills have improved, at least in comparison to their industry’s average. Asked to rate their company’s level of expertise on a scale of 1-10 (1=significantly below industry average, 10=significantly above industry average), respondents’ mean rating was 6.6. This is a considerable jump from the rating of 5.2 given the prior year.
Companies with more than 10% in internet sales rated their company’s expertise even higher (7.3), as did Transportation (8.3), Retail/Wholesale (7.8) and Customer Services (7.4) companies. That said, companies with more than $10 billion in sales revenue had the lowest mean (6.0).
Investment in Mobile and Social
During the early months of the pandemic, the share of marketing budgets dedicated to mobile and social media spiked. June 2020 study data shows that 23% of marketing budgets were allocated to mobile (up from 13.5% in February 2020), while another 23.2% share was invested in social media (up from 13.3% in February 2020).
As with digital marketing, the contribution these two channels made to performance increased last year, albeit to a lesser extent. Respondents report that social media contribution to company performance was 17.7% higher last year, while mobile’s was 9.4% higher.
Nevertheless, the share of spend on mobile and social media had decreased by February 2021, dropping to 18.5% and 14.9% of marketing budgets, respectively. And, while these percentages are more reflective of the increases in investment in both channels seen prior to the pandemic, it is worth noting that estimates show that in 5 years, respondents expect mobile to account for more than one-third (35.7%) of marketing budgets. This is not too surprising considering the amount of time consumers are already spending on their mobile devices.
The full report can be found here.
About the Data: Results are based on a survey of 356 top marketers (94.5% are VP-level and above) at US for-profit companies.