A new report from Adobe (written by consulting firm Ovum) promoting its “experience cloud” surprisingly finds that digital is still a relatively small piece of overall marketing budgets and the pace of investment has slowed.
The report is the result of telephone interviews with representatives of “200 high-tech businesses – covering the software, internet, consumer electronics, technology manufacturer, and professional/IT services” in March and April.
Digital marketing investments slowing. A range of topics is explored in the report, including perceptions of market competition, digital transformation, customer experience challenges and digital marketing. It’s the findings on the last of these that caught my attention.
Are you planning to increase or decrease your digital marketing spend?
Source: Ovum, Adobe (2018)
The survey asks whether companies are planning to increase or decrease their digital marketing spend in 2018. Compared to 2017, a declining number of those surveyed are increasing their digital marketing budgets.
Small portion of overall marketing budget allocated to digital. That would make sense if they were fully invested. However a related finding (below) shows that the majority of these companies are spending only a small percentage of their total marketing dollars on digital. Nearly half of all respondents were only spending 5 percent of total marketing budgets on digital and about 70 percent of the sample were spending less than 10 percent on digital.
That raises the question of how “digital marketing” is defined. Regardless, spending levels that low seem outdated and inconsistent with efforts to provide the best possible customer experience today.
Source: Ovum, Adobe (2018)
Another question asked about future digital marketing investments. Almost all areas indicate increased investment vs. 2017. Campaign management, customer experience and “account based marketing” were the top categories identified by these respondents. Overall, there’s something strange and incongruous here in the findings.
Source: Ovum, Adobe (2018)
Why it matters. If these respondents are representative of “high tech business” generally — though it should be noted that the size of the firms interviewed was not reported — then there’s a significant mismatch between consumer behavior and use of technology by companies trying to meet their expectations.
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