11 April, 2013
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Digital Marketing Budgets Up, Understanding Down
Digital Marketing Budgets Up, Understanding Down
It’s no
secret that digital marketing is a confusing topic. Companies know social media
and mobile marketing are increasingly important, and invest heavily in both
fields. At the same time, however, if a recent report is any indication,
understanding of digital marketing ROI is dwindling.
The
report, Marketing Budgets 2013, is a joint effort by industry analysts Econsultancy
and Responsys. The annual report surveyed over 800 marketers. The results were
a strange mixture of understanding and mystification.
Spending Up….
Digital
marketing budgets are on the rise, with 75 percent of respondents planning to
increase spending in 2013. In an encouraging move, 56 percent reported plans to
increase budgets by over 20 percent. This is great news if you’re in the
business of providing content marketing or SEO. Baltimore MD, Los Angeles, CA, New York,
NY – wherever you’re located, you should see increased spending on digital
marketing.
Content
marketing’s growing importance was obvious, with 70 percent of respondents
planning to increase spending on content, while 65 percent indicated they’ll
increase their natural SEO result budgets. Email marketing spending came in
third at 65 percent, with social media and mobile marketing coming in at 62 and
61 percent, respectively.
While in
the top five, mobile marketing spending seems low, considering the field’s
rapid rise in importance. Actually, it’s possible that the very speed with
which mobile marketing is developing explains relatively low budgetary
commitments; spending has yet to catch up with marketing potential.
…. Understanding Down
Despite
ever-increasing spending on digital marketing, only 50 percent of survey respondents
claimed a “good” or “very good” understanding of digital marketing ROI, while
18 percent reported “poor” or “very poor” understanding.
These
numbers reflect a continuing decline in understanding over the last three
years. The 2010 survey reported 67 percent of marketers had a firm understanding
of digital marketing ROI, with only 10 percent claiming a poor grasp of the
issue.
The
industry, it seems, is at odds with itself. Almost everyone’s willing to accept
the importance of digital marketing, but an increasing percentage of marketers
lack the knowledge or skills to accurately measure social media’s value. Half
the survey respondents are throwing large budgets at digital marketing and
essentially trusting the return on investment will be positive.
That’s a
dangerous game, because like any form of advertising, digital marketing comes
with no guarantees.
Part of
the problem may stem from the ever-growing, ever more complex nature of digital
marketing venues. Not so long ago, mobile marketing was unheard of, and social
media continues to defy traditional ROI measurement tools. Even so, any
marketer reporting less than a good understanding of digital media strategies
should be worried.
On the
plus side, attitudes in the industry are changing. Marketers increasingly devote
budget funds to training and education, so hopefully the disconnect between
spending and ROI understanding will come to an end. At least, until the Next
Big Thing takes the industry by surprise.
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