Marketing budgets, as a percentage of revenue, are recovering, CMO survey says

Marketing leaders are considering increasing their budgets as spending on customer experience drops, affecting customer retention. Despite economic uncertainty, marketing budgets are slowly rising, which was expected based on previous surveys. The latest CMO Survey from Duke’s Fuqua School of Business reveals a slight increase in marketing budgets, reaching 9.4% of company revenue, up from 7.7% in the fall. The survey, conducted bi-annually with 281 senior marketers, shows a 3.3% increase in marketing spending over the past year, with digital marketing spending up by 7.3%.

While the survey predicts further budget growth in 2025, marketing leaders are hesitant to invest fully due to inflationary pressures. Decision-making paralysis is another challenge, with marketing leaders trying to allocate resources effectively in the face of uncertainty. Customer experience spending is expected to decrease, impacting customer retention, a crucial aspect for businesses with subscription models.

Marketing is urged to prioritize customer experience and integrate it with customer marketing to drive growth. The report also indicates a planned increase in marketing hires by 5.0% in the coming year, with hiring top talent being a significant challenge for marketing leaders. Despite the positive outlook for marketing budgets and hiring, companies are cautious in their spending decisions amid ongoing economic challenges.