Global marketers expect their budgets to rise in 2019

At least six in 10 marketing chiefs globally are expecting growth in their budgets in the coming year.

Global marketers expect their budgets to rise in 2019

Technology, energy, financial services and healthcare sectors are the most optimistic about an expansion in their spending power in the next 12 months, according to research carried out by Dentsu Aegis Network surveying more than 1,000 chief marketing officers worldwide. 

The Dentsu Aegis Network CMO Survey 2018 found in the tech sector, more than three quarters of chief marketing officers say their budget will climb, with 31% predicting that increase will be more than 5%.

Similarly, in financial services, 26% of chief marketing officers predict a boost of more than 5%, with another 43% forecasting an increase of up to 5%. 

Despite optimism around budgets, a wider business focus on a strategic approach to marketing is still a concern, with 48% of chief marketing officers struggling with securing long-term investment to deliver their strategies, while four in 10 marketing chiefs say they have insufficient control over digital investments or programmes across the company. 

Source: Dentsu Aegis CMO Survey 2018

'Many brands are guilty of letting the tail wag the dog'

Digital is bringing disruption in the tools and capability to execute marketing strategy, but Nigel Morris, chief strategy and innovation officer at Dentsu Aegis, warns of becoming distracted from long-term goals. 

"Many brands are guilty of letting the tail wag the dog—of allowing a short-term preoccupation with digital detract from long-term brand-building," Morris said.

"As with any innovation, these tools need to be considered in the context of a brand’s long-term strategy and as part of an integrated marketing mix that address all phases of the consumer lifecycle." 

Although the report—which surveyed CMOs in 10 global markets including Australia, China and Japan—found almost half intend to work more with specialist marketing contractors over the next two to three years, 33% say they will reduce the number of external agencies they work with, while 29% will work more with management consultancies. 

Regarding the Asia-Pacific markets specifically, Japan showed the lowest confidence over increasing marketing budgets at 35%, while China was at the opposite end of the spectrum with 75% confidence.

The findings follow management consultancies Accenture, PwC, IBM and Deloitte entering Ad Age’s ranking of the 10 largest agency companies in the world for the first time in 2017, with a combined revenue of $13.2bn (£10bn). 

Reflecting the challenge to the traditional marketing world, where some of the biggest tech companies in the world—Google, Facebook, and Baidu—are also media companies, more than half (54%) of chief marketing officers are planning to increase their own investments in digital media platforms over the next two or three years. 

More data, more problems

Meanwhile, the report highlights the role of data in marketing as both a challenge and an opportunity. 

While there is more data available today and almost three in 10 CMOs think using data to reach real people is the top strategic opportunity, 61% of CMOs believe it is harder to extract insight from data, placing a new emphasis on skills and capabilities, particularly in such areas as data science.

At the same time, 60% of all CMOs believe that data protection regulation such as GDPR make it harder to build a direct relationship with the consumer, with CMOs from the financial services sector particularly likely to believe this.

In APAC, Australians (63%) are the most cautious regarding the effects of GDPR, while China and Japan are lower at 53% and 47% respectively.

Arvind Sethumadhavan, DAN APAC chief strategy & innovation officer, said: ‘In Asia-Pacific, we particularly see the opportunity for marketers to leverage data to secure long-term customer relationships.

“The diversity of the region is another factor that increases the need for Asia-Pacific CMOs to ensure they are able to deliver a consistent brand narrative targeting real people. This has strong potential to transform marketing’s role as the architect of a business’ long-term vision.”

Source:
Campaign UK

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