CMOs Hold the Purse Strings (And The Purse Is Expanding!)
If you’ve seen Scott Brinker of Chief Marketing Technologist’s supergraphic this year, then you’re probably not surprised by IDC’s latest prediction: CMOs will drive $32.3 billion in marketing technology spending by 2018—a compound annual growth rate of 12.4% from $20.2 billion. It’s official. The CMO holds the purse strings and that purse is expanding.
Take another look at the supergraphic, posted below. The number of marketing technology companies has doubled in size since last year. Marketers have more marketing technologies to help them reach their objectives, and the spending patterns follow.
Of note in IDC’s research is that CMOs are anticipated to increase spending in “non-traditional” areas—that is, beyond CRM or marketing automation. (That’s not to say that CRM spending will decrease. IDC forecasts CRM spending will reach $41.7B in 2018.)
As noted by Louis Columbus, Forbes, “The additional areas of marketing spending IDC is including in their forecast taxonomy are content, data and analytics, and management and administration.” Based on IDC’s graph below, data and analytics and interaction systems in particular are poised to receive the biggest jump in spending from marketing teams.
As the breadth of applications, tools, and technologies available to marketers increase alongside marketers’ budgets, it will be interesting to look for clues in those spending patterns to identify what really matters and is working well for marketers.
We predict that we will see spending preferences towards technologies that “play nicely” with each other (seamless integrations), and technologies that are proven to have significant ROI—better conversions, more targeted impressions, and bigger revenues linked to marketing tactics.