lustratus REPAMA

Posts Tagged ‘budget’

...falling in 2009. No great surprise there then as marketing budgets have been used by many struggling organisations as a “profit shock absorber” .

But what is of interest is what that reduced budget has meant to the shape of marketing organisations and their priorities. How are they actually allocating remaining budget in these tough times? What has this meant to marketing headcount? etc.

That is the focus of IDC’s Michael Gerard in his annual analysis of marketing spend. Some snippets of the study have been released publicly and I’ve listed some of these below:

• Large organisations’ marketing budgets have on average reduced by 8.3% and their headcount has reduced by 10%
• 6000 IT vendor marketing roles have been lost worldwide in 2009
• Lack of budget has forced process improvements and in particualar has meant closer collaboration with sales
• Broader, product portfolio marketing has been sacrificed to allow for more tactical themed campaigns.
• Sales enablement has become a focus

Michael makes some other general observations and recommendations in his blog which is well worth a read.

Danny Goodall

…slowing according to IDC’s Michael Gerard.  No surprise there then given the global economic slowdown.  I guess we’ve all seen some evidence of a slowing in spending and recruiting perhaps the surprise is that the slowdown is not as bad as one might have expected.  The results come from IDC’s 2008 Tech Marketing Benchmark Study (covered more fully on btobonline.com).  This is a piece of research that should find itself on every senior marketing exec’s highly polished desk.

Anyone expecting a grilling over budget requests should have studied this report beforehand for justification.  If you’re asking for money and you haven’t realised that your request is 10% higher than the average in the industry – you’re toast!  Well almost.  But knowledge is power and asking for cash whilst being able to point to good quality stats from your peers that justify the amounts against industry data will add weight to your request.

I’ve not seen the report but judging by the summary I’ve seen, it provides all sorts of benchmark data from budget levels (as a percentage of revenue), spending priorities to staffing levels.  What I found most interesting was the focus on the ratio of corporate (head office) marketing spend to field marketing.  Gerard concluded that in general it is too highly skewed towards central spend, depriving the field marketing teams of money that might work better for their local sales organizations.

“Hallelujah” is all I can say.  When I worked on the vendor side of marketing I held down a number of senior European field marketing positions.  This is an impossible positiong when budgets are tight.  You’re caught between the needs of the local sales VP and the corporate marketing organisation kicking out programs that you can’t use in Uzbekistan or France.  Well you know what I mean.

In addition the report provides some real gems showing where other technology marketing execs have placed their bets in terms of the marketing mix.  For example, across the entire study, marketing teams allocated the following budget percentages to the following program categories:

Events (22%), Advertising (17%), Direct Marketing (16%), Marketing Support and Sales Tools (14%), Digital Marketing (12%), PR (5%), Collateral (5%), Market Intelligence (4%), Analyst Relations (2%) and Other (3%).

These figures come from a mix of hardware (41%), software (40%) and service companies (19%) and across a broad spectrum of organisational size.

Any firm data that helps marketing organisations justify their plans and build better campaigns is good news as far as I’m concerned.

Danny Goodall