Marketing technology’s percentage of marketing budgets fell to 23.8% this year, down from about 25.4% in 2023, according to Gartner’s 2024 CMO Spend Survey. Spending also fell for staff and agencies, while paid media grew, going from 25.6% last year to 27.9% in 2024.
Dig deeper: Do CMOs really understand how their teams use martech?
“The drop in martech investment doesn’t signal a dulled appetite for technology, rather it reflects CMOs’ diminishing influence over martech as other enterprise leaders, such as IT, take more control,” Ewan McIntyre, VP Analyst and the chief of research for the Gartner Marketing Practice said in a release. “Meanwhile, CMOs are clearly prioritizing media spend as they seek to drive revenue growth.”
Investment in staffing also fell sharply.
Why we care. Gartner suggests that the availability of AI might hold out prospects for higher productivity despite cuts in technology and labour. “Reduced budgets are only a problem if marketing leaders are working with the same tools as before — that’s not the case now that CMOs have AI,” said McIntyre. “GenAI is delivering enhanced productivity, despite constrained resources.”
Given that AI-powered solutions would be paid for out of the declining martech budget, this seems counter-intuitive — unless CMOs are focused on cheap (or free) AI resources with outcomes that justify any investment.
Digital leads paid media. Digital got the lion’s share of paid media, taking 57.1% of budgets this year, up from 54.9% in 2023. Top channels include search (13.6%), social advertising (12.2%) and digital display advertising (10.7%). Among offline channels, the top categories were event marketing (17.1%), sponsorship (16.4%) and TV (16%).
This happened as overall marketing budgets fell to an average of 7.7% of overall company revenue, down from 9.1% in 2023. Just four years ago, marketing budgets averaged 11%.
Methodology
The survey was conducted in February through March 2024. Survey respondents were 395 CMOs and marketing leaders in North America and Northern and Western Europe across 10 different industries, company sizes and revenue, with the vast majority of respondents reporting a median annual revenue of over $5.3 billion.
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