What’s Up With Martech Spending Madness for CMOs?


The Gist

  • Martech spending wins and struggles. While 83% of CMOs anticipate increased martech budgets in 2024, there’s a current trend of budget constraints, with 50% citing them as a barrier to martech investment.
  • Skills and knowledge over budget.More than budget constraints, a lack of proper skillsets and understanding of technology appears to be a significant roadblock to leveraging martech effectively.
  • Data and AI as central pillars. Data management is foundational, with 76% of CMOs emphasizing its role in martech effectiveness. Additionally, there’s a strong focus on AI, with 73% of CMOs seeing its potential to enhance marketing efficiency and 47% planning AI-related initiatives.

Analysts, reporters and marketers alike all wonder the same thing: What’s on the spending agenda for chief marketing officers (CMOs).

And if you like uniform answers, you’ve come to the wrong party.

The latest report to pin down the CMO’s martech spending habits yields some good news if you’re a marketing technology vendor: CMOs want to spend money on your technology. This comes from marketing technology research LXA, which finds in its new State of Martech and Marketing Operations 2023/24 report that brands will spend more on marketing technology in the next 12 months. 

Specifically, 83% of CMOs expect martech budgets to increase in 2024. “Despite this, 50% of CMOs still see budget constraints as a barrier to martech investment — this may reflect vendor price increase, or perhaps that CMOs would always like a little more budget,” according to report researchers.

A closeup of the face of Benjamin Franklin on a $100 bill in piece about martech spending.
83% of CMOs expect martech budgets to increase in 2024.konoplizkaya on Adobe Stock Photos

A Tale of Many Martech Spending Messages for CMOs

It’s interesting because this flies in the face of Gartner’s May 2023 report on marketing spending, which found 71% of CMOs said they lack the budget to fully execute their strategy in 2023.

“Suppressed budgets, increasing costs and lower productivity are squeezing CMOs’ spending power,” Ewan McIntyre, chief of research and VP analyst in the Gartner Marketing practice, said in the report from May. “As volatility becomes the new normal, many CMOs are pricing disruption into their 2023 plans.”

And while the LXA report finds CMOs increasing marketing technology spend in 2024, three-quarters of marketers will need to cut martech spend in 2023 to deliver better ROI. At the same time, the highest reported investment increase across all major marketing resources by CMOs this year goes toward marketing technology, while the largest decrease goes to labor.

Able to digest all those fluid trends and reports? Neither are we.

Related Article: Are You Measuring Your Martech Correctly? Really?

What Stands in the Way of Martech Success?

Here’s one way to look at this: CMOs and marketing leaders, despite the sporadic reports on marketing technology spending, still see marketing technology as crucial to delivering on marketing campaigns and customer experience.

“The biggest changes to the role of the marketing leader is that it is increasingly important for marketing leaders to have a deep understanding of the technology stack, both strategically and functionally,” a survey respondent told CMSWire researchers in The State of the CMO: Insights from the 2023 Annual Chief Marketing Officer Survey. “The heavy reliance on martech to improve CX and move the revenue needle means that it is no longer possible for a ‘leader’ from another part of the company to take over a marketing leadership role and be effective. The practical understanding and experience of the tools and associated processes is crucial.”


Source link