Gartner: Marketing Budgets Down but GenAI Could Save the Day

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Hi AI Pro!

If your marketing budget is less than ideal, don’t fret. Consider the following as it relates to getting more bang for your buck, by adopting GenAI tools and using best practices to gain positive ROI.

Gartner: Marketing Budgets Down but GenAI Could Save the Day

A new survey of 395 CMOs and marketing leaders in ten different industries across North America and Europe conducted by Gartner finds that average marketing budgets have fallen to 7.7% of overall company revenue, down from 9.1% in 2023.

“CMOs are living in an ‘era of less’,” said Ewan McIntyre, chief of research for Gartner’s marketing practice. “In the four years preceding the pandemic, average marketing budgets were 11% of overall revenue. In the four years since, they’ve dropped to an anemic 8.2%.”

Even as marketing leaders remain under pressure to drive revenue growth, an economy-wide drop in spending on martech reflects their diminishing influence, as other enterprise leaders (most notably IT departments) take greater share of control over budgets.

WHY IT MATTERS

In the face of shrinking resources, GenAI is delivering enhanced productivity for marketing teams, according to the surveyed leaders. More than one third of them cited time and cost efficiencies as their top considerations when evaluating the ROI on AI solutions.

“The majority of those surveyed believe AI may save the day,” said McIntyre. “Sixty-four percent of CMOs say they lack the budget to execute their 2024 strategy, but GenAI offers the opportunity to grow the marketing function’s impact far beyond its budgetary constraints.”

“In these tough times, CMOs are prioritizing investments that have demonstrable impact,” McIntyre added.

ACTIONABLE ADVICE:

When evaluating generative AI (genAI) tools to invest in, marketing leaders should prioritize ones that can be pivotal to enhancing productivity and ROI. Here are some key strategic considerations:

Define Clear Objectives: Whether it's content creation, customer engagement, personalization, or data analysis, the choice of a genAI tool should align with the strategic objectives of the marketing department.

Integration and Compatibility: GenAI tools should seamlessly integrate with existing marketing tech and data infrastructures. Tools that require minimal integration effort and can leverage existing data sources will provide quicker returns.

Scalability and Flexibility: As marketing demands and strategies evolve, a genAI solution should be able to scale and adapt. Tools that offer customization and can grow with your marketing needs are more likely to provide long-term value.

User-Friendliness: To maximize productivity, opt for genAI tools that are user-friendly and minimize your team’s learning curve.

Compliance and Ethics: Ensure the genAI tool adheres to applicable data privacy laws and ethical guidelines.

ROI Estimation: Evaluate the potential return on investment, including not only direct revenue gains but also efficiency improvements, cost savings, and qualitative benefits like enhanced customer satisfaction.

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THAT’S ALL FOR TODAY, FOLKS!