Spiceworks Study Reveals Nearly 40 Percent Of B2B Tech Brands Are Increasing Marketing Budgets In 2019
By 2020, 48 percent of B2B technology companies plan to use purchase-intent targeting to reach in-market buyers
Spiceworks, the marketplace that connects the IT industry, announced the 2019 State of IT Marketing report examining marketing spend, trends, and challenges in B2B technology companies across North America and Europe. The survey found 37 percent of companies expect their marketing budgets to increase, 42 percent expect them to remain flat year over year, and only 8 percent expect a decline. Organizations that expect budget increases this year reported a 24 percent increase on average. The findings indicate a renewed priority on marketing is driving budget increases and enabling organizations to experiment with new marketing trends and technologies.
The results show small B2B tech companies with fewer than 100 employees are most likely to see their marketing budgets grow in 2019: 45 percent expect an increase, compared to 35 percent of midsize companies with 100 to 999 employees, and 28 percent of large enterprises with more than 1,000 employees. Across all company sizes, the vast majority of B2B marketers said their top priority is to generate leads and acquire new customers in 2019.
“Due to recent revenue and customer growth, many organizations are prepared to keep the momentum going in 2019 by investing more in marketing,” said Jamie Bowler, director of global demand marketing at Spiceworks. “Although measuring marketing ROI is still a top challenge in the B2B environment, new marketing technologies are enabling B2B marketers to build more accurate attribution models and stay focused on the top channels driving quality leads and engagement. As a result, we can better prove the value of marketing in enabling a more profitable organization.”
Marketing budget allocations: B2B tech brands are spending the most on paid media
On average in B2B tech companies, 30 percent of 2019 marketing budgets will be allocated toward paid media efforts, 22 percent to tradeshows and events, 21 percent will be used for marketing technology (martech), and 19 percent will be spent on external agencies and contractors. Although paid media efforts will account for the largest budget allocation in 2019, martech budgets will see the biggest increase year over year. More than half of organizations (51 percent) expect to spend more on martech in 2019 than in 2018.
Budget highlights within each category include:
- In paid media, budget allocations for search marketing (28 percent), social media marketing (19 percent), email marketing (12 percent), and display advertising (10 percent) top the list.
- Top martech budget allocations include technologies for content and experience (28 percent), social and relationship (20 percent), advertising and promotions (16 percent), and data and analytics (14 percent).
- Within external agencies and contractors, budget allocations for creative partners (30 percent), advertising/digital marketing partners (27 percent), and brand/PR partners (17 percent) top the list.
Marketing trends: Adoption of ABM and video marketing is on the rise
In addition to investing in the marketing basics, many B2B tech companies are also adopting the latest marketing trends. Today, 51 percent of organizations have deployed an account-based marketing (ABM) strategy, 49 percent are using video marketing, and 41 percent are using an on-demand content strategy. By 2020, these adoption rates are expected to jump to 70 percent, 71 percent, and 61 percent, respectively.
Adoption of influencer marketing, purchase-intent targeting, and AI-powered data analytics will also see a big boost in adoption over the next two years. By 2020, 51 percent of organizations expect to use influencer marketing, 48 percent plan to use purchase-intent targeting, and 44 percent plan to use data analytics tools powered by AI. Conversely, only 35 percent of organizations expect to use chatbots to support their marketing initiatives and only 17 percent plan to create VR- or AR-based customer experiences in the next two years.
Read More: Interview with Megan Kvamme, CEO at FactGem
In many cases, adoption rates in large enterprises are double the rates of smaller companies. For example, 58 percent of large enterprises are currently using programmatic ad buying and 47 percent are using purchase-intent targeting, compared to 21 percent and 16 percent of small businesses, respectively. Additionally, 28 percent of large enterprises are using chatbots in their marketing initiatives, compared to only 12 percent of small businesses.
Marketing challenges: Measuring marketing ROI is the top challenge of 2019
As they begin to roll out their 2019 strategies, many B2B marketers anticipate several challenges in the year ahead. At the top of the list, 48 percent of marketers said measuring marketing ROI will be their biggest challenge, which likely explains why martech budgets are on the rise in 2019. Additionally, 45 percent of B2B marketers said driving conversions with marketing content and 37 percent said aligning marketing and sales efforts will be their top challenge.