Gartner, a marketing research company, recently conducted a survey on companies’ use of marketing. Overall, Gartner found that the companies studied spent 10.4 percent of their total revenues on marketing. The percentage ranged from 9.1 for high-tech firms to 12.7 for media firms.
With regard to digital marketing, Gartner found that: “The majority spends between 10% and 50% of their marketing budget on digital marketing activities — the average is 25%.” This means that the companies surveyed spend an average of 2.5 percent of their total revenues on digital marketing. For some firms, this amount is higher than than net profit margins!!
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5 Replies to “Gartner Study: The State of Digital Marketing”
For some companies, the amount spent probably exceeds the benefit.
The money that some companies spend on digital marketing is astounding. This is basically a roll-of-the-dice situation. There is no way of telling whether their digital advertisements will pay off. The risk is greater than the reward depending on what type of product the marketer is trying to sell. I think that the changing technological times have a huge impact on this trend. The products that appeal to a younger audience are usually marketed through online techniques.
I feel like we need to take into consideration what the particular industry is. The demand is different for each type of service, and as a result, digital marketing numbers would vary to meet that demand. For example, media companies have a higher percentage of their marketing budget as company revenue simply because media companies in general have more online services and they know their customer base is coming from the internet. The list really does not surprise me, and it is all very relative to that type of industry. However, I do believe that these numbers will continue to rise in the future as a result of the growing popularity of the internet and its effects on our everyday lives.
When companies spend more money on marketing than they have a net profit they know the importance of getting themselves out there. The more marketing the better off a company is in the long run. Even if a company is just mentioned that is what they want. Digital marketing is a good form of marketing because everyone uses the internet. It will be seen by many, it’s just a matter if the ad appeals to the viewer.