2019 CMO Budget Reality Check

Where are marketing budgets headed in 2019?

We set out to answer that question in Gartner’s 2018-2019 CMO Spend Survey of 621 marketing executives in the United States, Canada and the U.K.

“This year’s survey presents positive news for marketers. Budgets remain solid in 2018, and confidence is high heading into 2019,” said Ewan McIntrye, Gartner senior director analyst and the report’s co-author.  “But marketing’s confidence must be tempered by caution. Environmental uncertainties and capabilities challenges abound.”

Let’s start with 2018. Marketing budgets* averaged 11.2% of company revenue this year, which is about the same as 2017 (11.3%).

We also asked marketing executives about their 2019 spending plans:

• 63% said they expect their 2019 budgets will increase, including 12% who expect a “significant” increase
• 27% expect their budget will stay the same
• 11% expect their budgets will be cut**

Our conversation with marketing leaders suggest these budgets are fluid. Some are hard-pressed to make a business case to restructure or increase budgets for staff. On many to-do lists: Bring activities in-house, such as media planning and buying, and make better use of their agencies.  Meanwhile, external and internal forces may necessitate reality checks and reviews of spending priorities throughout the year.

The survey, which has been conducted annually since 2012, highlights other trends such as:

• Out of eight industries in the survey, the travel industry spends the highest percentage of company revenue on marketing at 11.8%.
• Spending on marketing technology, relative to other marketing operations, took a larger share of the CMO’s budget in 2018: an average of 29% of the budget compared to the prior year’s 22%.
• Over 9% of the marketing budget, on average, is allocated to digital commerce, but CMOs downplay its strategic importance.
• CMOs struggle to align marketing metrics with business priorities.

Gartner clients can obtain:

 The survey’s key findings in the report, “CMO Spend Survey 2018-2019: Marketers Proceed Into Uncharted Waters With Confidence.”

Spending priorities and trends for eight industries in the report, “Survey Analysis: How CMOs Plan to Spend in 2019 by Industry.” Those industries are: Consumer products, financial services, healthcare providers, retail, media, travel, high tech and manufacturing. 

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* Marketing expense budget: This includes marketing personnel costs, investment in marketing software-as-a-service, agencies and other external marketing services, and advertising. It does not include the capital expenditure budget.

**Percentages don’t add up to 100 because of rounding.