Tuesday, June 22, 2010

Companies Dedicate 2x More to Marketing Than IT

According to MarketingSherpa's B2B Marketing Spending Benchmark Survey, large organizations dedicate on average 6% of revenues to marketing spend, including advertising, digital marketing, marketing services and internal labor expenses / costs.

I found this number surprisingly higher than anticipated. Comparing marketing spending to IT spending, IT spending averages half as much, at only 3.1% of revenues on IT (from Alinean's ValueBase research). No wonder there is a focus on return on investment from marketing as never before!

The highest spenders proportionally are small organizations, those with less than 100 employees, dedicating some 11% of revenue to marketing. In the survey, mid sized organizations of 100 to 1000 employees, indicated spending of a still significant 9% of  revenue on marketing.

According to MarketingSherpa analysts, the difference between large organizations to smaller organizations is a  reflection in the economies of scale from marketing spending being higher in large organizations, more so than it indicates aggressive marketing spending by smaller organizations compared with larger counterparts.


The analysts from MarketingSherpa indicate that "For companies of all sizes, a decline in revenue has resulted in marketing budget reductions and a shift to more cost-efficient digital tactics, such as email, search and social media. Organizations that have been required to stretch every dollar during this recessionary period are getting more mileage from these new media tactics."

More information can be found at: http://www.marketingsherpa.com/article.php?ident=31641#

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