Of the 51 percent of companies who plan to increase their digital marketing budget in 2015, the average increase will be 17 percent
Marketers are investing in the customer experience to drive business advantage and profitable revenue growth, says Gartner. The survey found that marketing budgets remained healthy in 2014, with, on average, companies spending 10.2 percent of their annual 2014 revenue on overall marketing activities, with 50 percent of companies planning an increase in 2015.
Digital marketing spending averaged one-quarter of the marketing budget in 2014. The survey found that of the 51 percent of companies who plan to increase their digital marketing budget in 2015, the average increase will be 17 percent.
"The amount of the marketing expense budget spent on customer experience in 2014 is remarkably consistent across all key survey demographics, averaging 18 percent," said Jake Sorofman, research director at Gartner.
"The survey also found that the highest marketing technology investment in 2014 is for customer experience. Customer experience is also considered by many companies to be the top innovation project, just edging out product innovation," he adds.
Not only are marketing budgets remaining healthy, they are forecast to grow in 2015, with half of the companies surveyed planning an increase in 2015. The larger the company, the higher the marketing expense budget as a percentage of revenue — those with revenue of $5 billion or more reported 11 percent, compared with 9.2 percent for those with revenue between $500 million and $1 billion.
The 50 percent of companies planning an increase report their average 2015 increase will be 10.4 percent. Of those, the ones that report outperforming competitors said their planned 2015 increase will be 13.6 percent.
As in prior years, the survey revealed that when it comes to allocation of the digital marketing budget by activity, digital advertising takes the top spot. However, there appears to be less difference between this and other activities this year compared with last year, as marketers hedge their bets. Expenditures for digital advertising will grow in 2015, as brands, ad agencies and publishers invest in ways to deliver more-relevant advertising to people.
With digital marketing spending on the rise, respondents were also asked where additional funding was coming from:
"Gartner's 2014 CEO Survey found that digital marketing was the No. 1-ranked CEO priority for technology-enabled business capability for investment during the next five years," said Yvonne Genovese, managing vice president at Gartner.