The findings of the August 2021 edition of The CMO Survey were published last month. The CMO Survey is led by Dr. Christine Moorman and sponsored by Duke University's Fuqua School of Business, the American Marketing Association and Deloitte LLP.
This is the first of three posts that will discuss some of the B2B-specific findings from The CMO Survey. The August survey results are based on responses from 282 senior marketing leaders at for-profit companies based in the United States. Over two-thirds of the respondents (69.8%) were affiliated with B2B companies, and 94.1% were VP level or above. The survey was in the field August 4-25, 2021.
The CMO Survey is conducted semi-annually, and it provides a wealth of information. Dr. Moorman and her colleagues typically produce three reports for each edition of the survey.
- "U.S. Highlights and Insights Report" - This is a relatively brief and graphically-rich report that provides mostly top-level results, along with an analysis of those results and major marketing trends.
- "Topline Report" - This report provides response data at the aggregate level for all survey questions.
- "U.S. Firm and Industry Breakout Report" - This is the most detailed report. It provides response data by four primary economic sectors (B2B product companies, B2B services companies, B2C product companies and B2C services companies), fifteen industry sectors, company size and volume of internet sales. This report is typically quite lengthy, but it provides the most granular view of the survey data.
The CMO Survey does not state that it uses a representative sample of senior marketing leaders at U.S. for-profit companies. Therefore, the survey findings cannot be projected to the entire population.
In this series of posts, I'll be discussing the responses of B2B marketers exclusively unless otherwise indicated. The percentages and other numerical values in these posts are the mean of survey responses, also unless otherwise indicated.
Marketer Optimism Reaches Pre-Pandemic Levels
On average, the optimism of B2B marketers has returned to pre-pandemic levels. The survey asked participants to rate their level of optimism regarding the overall US economy on a 100-point scale, with "0" being least optimistic, and "100" being most optimistic. The following chart shows how B2B marketers rated their optimism in the five surveys conducted since August 2019.
Marketers' optimism appears to be reflecting the trajectory of overall economic growth in the US. According to the Bureau of Economic Analysis, US real GDP grew at an annualized rate of 6.3% in the first quarter of 2021 and at an annualized rate of 6.7% in the second quarter.
The Conference Board is currently forecasting that real GDP will grow at an annualized rate of 5.5% in the third quarter and by 3.9% in the fourth quarter. For the entire year of 2021, The Conference Board expects real GDP growth to grow by 5.9%, slowing to 3.8% in 2022.
The State of Marketing Spending
The CMO Survey includes several questions pertaining to the state of marketing budgets and spending that usually receive a good bit of attention. The survey asked participants to estimate what percentage of their company's total revenue is represented by marketing expenses. The following chart shows how marketers from B2B product companies and B2B services companies responded to this question in the surveys conducted since August 2019.
In a recent post, I discussed some of the findings of Gartner's CMO Spend Survey, 2021. The "headline" finding of that research pointed to a significant decline in marketing budgets as a percentage of company revenue. Gartner found that the mean percentage of total company revenue allocated to marketing in 2021 is 6.4%, down from 11% in 2020. The mean percentage for B2B companies represented in the Gartner survey was 6.2%.
The above chart also shows a decline in marketing spending as a percentage of company revenue in the August 2021 edition of The CMO Survey, compared to the previous four surveys. The decline occurred in both B2B product companies and B2B services companies.
In its survey report, Gartner treated the decline in the proportion of marketing budgets to company revenue as evidence that marketing budgets have been cut - or at least that they haven't recovered from cuts that occurred last year. I don't believe the survey data supports that conclusion.
As a ratio metric, the percentage value is obviously affected by both components of the ratio. A company's marketing budget may have been increased in absolute terms, but the proportion would still fall if company revenues grew enough in the same time frame.
The CMO Survey provides a more direct measure of changes in marketing spending. The survey asked participants to estimate by what percent their overall marketing spending changed in the twelve months preceding the survey. The following table shows how B2B marketers answered this question in the five surveys conducted since August 2019.
This table clearly shows that marketing spending in the survey respondents' companies slowed or declined in the June 2020 and February 2021 editions of the survey. However, marketers in both B2B product companies and B2B services companies reported increases in spending in the latest survey.
My view is that this is one of those issues where averages aren't particularly meaningful. In fact, The CMO Survey found that changes in marketing spending varied substantially across industries. For example, in the August 2021 edition of the survey, respondents with banking, finance and insurance companies reported a mean increase of 20.2% over the preceding twelve months, while respondents with manufacturing companies reported a mean increase of only 3.6%
In my next post, I'll discuss more of the B2B findings from the August edition of The CMO Survey.
Top image source: The CMO Survey