Things Are Looking Up for Marketing

May 29, 2019

By Cliff Campeau


According to Gartner Research, North American and U.K. companies will spend 11.2 percent of corporate revenue on marketing in 2019. Nearly two-thirds of CMOs are expecting to see marketing budgets rise this year. The recent IPA Bellwether survey indicates that U.K. marketers saw an 8.7 percent increase in the size of their advertising budgets during the first-quarter of 2019. Martech budgets will account for almost 30 percent of marketing expense budgets in 2019. On the strength of its break-through brand building efforts Burger King is "cool again" proclaims INSEAD. Former Anheuser-Busch InBev CMO, Miguel Patricio is promoted to CEO of Kraft Heinz.

What do these seemingly disparate items have in common? In short, organizational confidence in both marketing and marketers appears to be on the rise and zero-based budgeting (ZBB) has helped, not hindered, marketing's resurgence.

By way of background, U.K. marketers, including Unilever and Diageo, have been at the forefront in adopting ZBB. AB InBev is a ZBB organization, and 3G Capital, which owns Burger King and Kraft Heinz, has employed ZBB. And finally, martech budgets are soaring because organizations have driven out marketing budget inefficiencies, applying savings to fund productivity enhancing research and innovation initiatives.

Over the last decade or so, marketers had to renew their focus on demonstrating that the marketing function could in fact drive business, including both top line revenue and net profit. Marketers had to do this at a time when companies had shifted their focus to cost management and categorized marketing as an expense, not an investment.

The message sent to marketing was clear, budgets and the success of the CMO would be tied to achieving quantifiable results that supported the organization's goals. For many firms, ZBB was an integral part of this process. ZBB provided a framework for eliminating unproductive costs and identifying areas, which better supported firm strategies and that were worthy of financial support.

At a time when "faster, better, cheaper" has become a guiding principle and where big data and technological advances are driving dizzying rates of marketplace change, building a successful marketing infrastructure has become increasingly difficult. Yet, there are numerous indicators that would suggest things are moving in a positive direction. The structure, processes and accountability that is part and parcel of a ZBB process appears to have aided marketing's resurgence.

In the words of American economist, Emily Greene Balch: "The future will be determined in part by happenings that it is impossible to foresee; it will also be influenced by trends that are now existent and observable."

Cliff Campeau is a principal with AARM.

The views and opinions expressed in Marketing Maestros are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.

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