Supressed Budgets Are Putting Pressure on CMOs to “Do More With Less”
During March and April, Gartner surveyed 410 CMOs and marketing leaders from across different industries in North America and Northern and Western Europe. The results of the survey cause concern as they reveal that a whopping 71% of CMOs believe “they lack the budget to fully execute their strategy in 2023”.
According to Ewan McIntyre, Chief of Research and VP Analyst in the Gartner Marketing Practice, there are three things that are squeezing spending power at the moment: supressed budgets, increasing costs, and lower productivity. As a result, 75% of CMOs are now under pressure to figure out how they can do more with less and still deliver profitable growth.
“In 2023, CMOs need to become a new type of enterprise leader. This goes beyond serving at the helm of the brand but also assuming a more business-focused role that pivots into a period of investing for profitability versus growth. Those that carry on status-quo will face significant challenges in the near-term,” McIntyre reportedly shared.
SHOULD YOU INVEST IN MARTECH?
Another interesting finding presented by Gartner revealed that the utilisation of MarTech has fallen from 58% in 2020 to 42% in 2022. As a result, 75% of marketers now feel that they are under pressure to reduce spending on new technologies.
Despite this pressure, however, the highest investment increase by CMOs in 2023 still went towards MarTech. Considering the incessant chatter surrounding generative AI and its benefits, this is not surprising. Likening CMOs to gamblers that seek to write-off their losses with their next bet, McIntyre questioned whether investing in more tech is always better.
“[CMOs] are hungry to see [AI’s] potential to transform marketing campaigns and content creation. While this hunger to invest is understandable, it illustrates the sunk-cost fallacy that more tech is always better.
The willingness to let the majority of their MarTech stack sit idle signifies a fundamental resource disconnect for CMOs. It’s difficult to imagine them leaving the same millions of dollars on the table for agencies or in-house resources. This trade-off of technology over people will not help marketing leaders accelerate out of the challenges a recession will bring,” McIntyre claimed.