Digital marketing represented one-quarter of the total marketing budget this year at companies with more than $500 million in annual revenue, details Gartner in a new report. The study is based on a survey of 315 executives in the US, Canada and the UK who hail from companies in the financial services, high-tech, manufacturing, media, retail and transportation and hospitality industries. Some 51% of respondents plan to increase their digital marketing budget next year. Among those, the average increase is expected to be 17%.
By comparison, half of the respondents indicate that marketing budgets overall will increase next year, but by a more modest 10.4%. In other words, digital marketing budgets are growing at a faster rate than overall marketing budgets. That implies that the well-documented spending shift from traditional to digital will continue, particularly as two-thirds will fund digital marketing through a reinvestment of their existing budgets. Gartner does note, however, that “the line between digital and traditional marketing continues to blur.”
When averaged out among the entire respondent sample, Gartner finds that digital marketing budgets will grow by 8% next year.
In other results from the study:
- Marketing budgets, on average, represent 10.2% of revenue this year, with this figure tending to be higher among larger companies;
- Two-thirds of companies have a separate digital marketing budget, either a digital marketing budget in total (32%) or in detail (36%);
- Almost 8 in 10 respondents have a marketing budget for capital expenditures, with these funds chiefly for infrastructure and software;
- Some 18% of the marketing budget is allocated to supporting the customer experience this year;
- Digital advertising gets the largest share of digital marketing budgets, though mobile will rise to tie it next year.
About the Data: The survey was fielded in July and August 2014.