In response to a substantial drop in technology spending, B2B marketers will cut budgets and re-jig their media mix.
This was one of the main conclusions drawn from the recent BtoB webinar: Outlook 2009: Marketing Priorities and Plans.
The webinar featured Kate Maddox, Senior Reporter, BtoB Magazine, Rich Vancil, VP Executive Advisory Group at IDC, Mark Wilson, VP Corporate Marketing at Sybase and Mark Gambill, CMO at CDW
Rich Vancil spoke to some preliminary results compiled from a recent survey of 36 tech marketing vendors.
Tech & Marketing Spend - IDC forecasts that IT Global Revenue Growth will increase marginally by 0.5% in 2009 and Global Marketing Investment Growth will drop by 10%.
Although this is a sombre forecast, it does not compare to the steep drop in spend in 2001 (see my previous blog post on this).
Brand vs. Lead Generation - The IDC survey indicates that B2B marketers have ranked demand generation significantly higher than awareness building for marketing initiatives. In good times, IDC has found that the rankings of demand generation and awareness building are equal.
The further that a marketing activity is distanced from the sales team, the deeper the cuts will be. IDC forecasts deep to moderate cuts in branding, big tent events, marketing strategy and product marketing but moderate increases in lead management and qualification and sales enablement.
Digital Marketing - IDC reports that digital marketing spend is over 9% of total marketing investment in 2008 and predicts that digital marketing will carve out the largest slice of marketing spend by 2010.
Sales Spend - Areas such as sales administration and outside sales will bear the brunt of cuts while sales enablement and insides sales are forecasted to see increased funding.
Sales investment in Lead Qualification and Demand Generation will increase by 20%+ in 2009.
Mark Wilson from Sybase and Mark Gambill from CDW echoed Rich Vancil's remarks.
Sybase is using the recession as an opportunity to assess all marketing programs, even the 'sacred cows'. Integrated programs are prioritized over one-off, standalone programs. Sybase's media mix will favor online media such as SEM, social media and virtual events.
CDW has taken a very analytical approach in strategic target marketing and understanding customer behavior. From this, CDW has aligned the essential programs to the strategy and any outliers are subject to scrutiny and cost-cutting.
As I consider the comments made during the webinar, some further thoughts come to mind as advice for marketers:
- Be Proactive - 'If we cut marketing budgets by 10%, what will the impact be?' If you can't address this question in a factual way, then your CFO will answer this question for you.
- Be Focused - Now more than ever, marketing needs to focus on success, minimize the noise and gain organizational buy-in.
- Don't be Misled by the Law of Averages - Although the overall marketing budget may be cut by a significant percentage, there usually is latitude to double down on the winners and cut out the losers with a more effective media mix.
- Remember that Change is Opportunity - with your competitors shedding unprofitable product lines, cutting back on marketing spend, tarnishing their customer satisfaction levels and laying off valuable staff, now may be the time to seize the day.
- Use Levers in the Demand Generation Process - The most prevalent points of leverage are the shift from offline media (e.g. print advertising, face-to-face events) to online media (e.g. virtual events, SEM, social media) and from outside sales to inside sales and telemarketing.
To download the BtoB Magazine webcast, follow this link: Outlook 2009: Marketing Priorities and Plans.
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