According to a report by B2B research firm Ascend2 with the help of digital agency Wpromote, 70 percent of marketing executives expected their digital marketing budgets to increase slightly or significantly in 2023. Ascend2 and Wpromote interviewed 348 marketing professionals in the United States in April 2023 and reported that 19 percent of marketers expected a significant increase while 24 percent of executives expected budgets to grow significantly.
Although 79 percent expected to utilize artificial intelligence (AI) tools in marketing strategies and 67 percent were positive about the impact of AI, another 16 percent were apprehensive with 12 percent being indifferent. Personalization and content generation led the use cases.
The top challenges companies faces in 2023 included improving customer experience, proving return on investment (ROI), generating quality leads, creating quality content, and aligning marketing with sales. While many of these challenges are somewhat perennial, the report was striking in how it exemplified that B2B marketing organizations have more to spend on digital initiatives even though they are facing economic headwinds.
This was in contrast to the views of a similar-sized sample expressed in Gartner’s 2023 CMO Spend and Strategy Survey, in which 12 percent to 26 percent of the parties interviewed expected to decrease spending in specific digital channels. The major differences between the studies were that the Gartner sample was evenly split between B2B and B2C marketers, also incorporating findings from Canada and Europe.
Key Planning Considerations for B2B Marketing Budgets in 2023
As though the COVID-19 pandemic and subsequent reshuffling of the entire business world in the last few years was not enough, 2022 brought several new concerns that were often beyond the average marketing manager’s control. Nonetheless, business carries on as usual, and marketing budgets for 2023 are currently being set.
With the litany of issues companies are facing creating a storm that may include a possible recession, many organizations are poised to freeze or reduce their ad spending next year. Keeping this in mind, here is a look at what 2023 has in store for marketing budgets, and how marketing managers may strategically plan for their success.
In the 2022 State of B2B Marketing Budgets Survey report from Integrate and Demand Metric, 60 percent of B2B marketers said they were facing reduced or stagnant budgets for this year. According to the report, 33 percent said they expected slightly higher budgets, 33 percent expected the same as 2022, 18 percent expected slightly lower, 9 percent expected significantly higher, and 7 percent expected significantly lower.
This was on the heels of a 2022 in which 21 percent of survey respondents were experiencing mid-year budget cuts, and many cited inflation as the reason for such budget reductions. The report also called attention to the resilience of marketers, with 80 percent of B2B marketers reporting a neutral to optimistic outlook for 2023.
Plan for the worst, but hope for the best continues to be the industry-wide wisdom. Many of the same variables from 2022 will continue to confound financial prognosticators in 2023.
Consider these headlines:
- NPR reported on October 9, 2022, “The word ‘recession’ is coming up more frequently. But there can be silver linings”
- CNBC reported on October 11, 2022, “IMF cuts global growth forecast for next year, warns ‘the worst is yet to come’”
- Business Insider reported on November 10, 2022, “It’s looking more likely that any recession next year will be shallow and manageable”
When it comes to deciphering the actual truth, it appears that only time will tell. In the meantime, careful planning and proactive measures will help improve a marketing team’s overall ROI and position them for additional investment in their future.
Incorporating such steps into a planning process can help companies create a lean and optimized marketing budget for 2023. The first step will be to review processes and identify pain points.
A confident step forward can often require a quick look back. A review of a company’s processes can aid in the discovery of steps taken and tools used that are now obsolete or ineffective.
Know what your team’s pain points actually are. Ask team members to share where in a process they encountered difficulty.
With pain points identified, a company could be able to better find a solution and increase efficiency. Are there manual tasks that can be automated?
If a team is still manually transferring data from one system to another, a company can buy back time with simple integrations. Is a company taking full advantage of tools in its tech stack?
It may be possible that a company already has solutions to pain points in its tech stack. It simply has not explored such features.
This emphasizes reviewing a tech stack and eliminating any redundancies. Tech solutions can save time and solve problems, but when a tech stack has not been thoroughly reviewed recently, a company may be paying for redundant systems.
The Integrate study found 38 percent of marketers identified redundant or unused components of their martech stack. The pandemic thus spurred a sudden and necessary adoption of several digital solutions, so when a company has not hit pause and examined the tools in its tech stack, now can be a great time to do that.
Companies should also invest in efficiencies. Even though adding new spending at a time of tight budgets could seem counterintuitive, investing in efficiencies will free up dollars elsewhere that may go toward other priorities.
The top areas to invest will include automation that frees up a team from the burden of repetitive tasks and means they will be able to invest more time on projects with greater impact, integration and data sharing that will be instant and complete to allow all team members to access the quality of information they need to do their best work, and employee well-being that involves identifying pain points and creating efficiencies to encourage continued problem-solving. In addition to finding new efficiencies, it will also be important to target inefficiencies and siloed strategies.
Companies also need to make their data work for them. Budget cuts can often coincide with increased reporting, because C-suite executives will focus on ROI.
Justifying ad spending can come down to the quality and volume of data a company collects. Investing in solutions enabling better tracking and reporting ensures a company has the numbers it needs to create reports that demonstrate the value of its team’s work.
It is also critical to underscore any long-term impact of brand-building and how it can expedite economic recovery. Much like 2022, 2023 will be a year of finding solid footing amidst the many aftershocks.
Now can be the time for precision reductions in overhead and adopting tools and processes that allow companies to be agile and responsive to market conditions while staying their strategic course toward growth.
More Marketing Statistics
2023 did not get off to an ideal start with so many tech layoffs, tightened budgets, and bank failures. There were several signs of economic slowdown toward the middle of 2022 because of rising interest rates and inflation.
Integrate and Demand Metric’s research report on “2022 State of B2B Marketing Budgets” found that B2B marketers expected budget cuts and higher growth targets in 2023. This meant countering many shifts in strategies, although 80 percent of marketers still expressed optimism for 2023.
Navigating 2023 after a tumultuous first quarter left many wondering if headwinds hurting marketing last year eased or persisted. How would B2B marketers adapt to such shifts and what areas of marketing and strategies would they invest their efforts?
Integrate partnered with Demand Metric to conduct a follow-on study on “The State of B2B Marketing Budgets 2023” and surveyed more than 500 B2B marketers around the world. It found that marketers were facing challenges of defending the spend, meaning they were being told to do more with less while experiencing burnout as they were increasingly expected to achieve impossible growth targets.
Despite this burnout and current stresses marketers were experiencing, they still increasingly expressed optimism for the remainder of 2023.
Here are additional insights from Integrate and Demand Metric’s “2023 B2B Marketing Budget survey.” The report found that almost 50 percent of B2B marketers cited the difficulty of using data to inform decisions and measure performance as the biggest challenge, suggesting an increasing need for marketers to defend the spend to finance departments and C-level executives.
As a result, almost 90 percent of marketers surveyed reported that data compliance and accuracy was a priority at their company. Without clean, compliant data, a company is not only at risk of not being able to reach its buyers and defend its spend, but was also at risk of violating privacy regulations and incurring hefty fines.
When it came to challenges marketers were facing in marketing, 45 percent said they were having difficulty using data, 40 percent cited headcount cuts or staffing, 39 percent said increasing or impossible growth targets, 38 percent cited budget cuts, 28 percent said ineffective or underutilized martech stacks, 18 percent said changing buyer preferences, and 10 percent reported no challenges.
Despite all of these challenges, 72 percent of marketers said their marketing team should meet or exceed goals in 2023. This suggested that marketers were working hard to compensate for reduced resources and meeting goals, but carrying the extra burden was taking its toll on their mental health.
B2B Digital Marketing Help in Houston, TX
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