The results 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 results of the August survey are based on responses from 282 senior marketing leaders at for-profit companies based in the United States. More than two thirds of respondents (69.8%) were affiliated with B2B companies, and 94.1% of them were of the Vice President level or above. Field survey conducted from 4 to 25 August 2021.
The CMO Survey is conducted biannually, and provides a wealth of information. Dr. Moorman and her colleagues typically produce three reports for each edition of the survey.
- “American Glimpses & Insights Report” – This is a relatively brief and graphically rich report that often provides high-level results, along with an analysis of those findings and key marketing trends.
- “Topline Report” – This report provides response data at the aggregate level for all survey questions.
- “US Business and Industry Penetration Report” – This is the most detailed report. It provides response data by four primary economic sectors (B2B product companies, B2B service companies, B2C product companies and B2C service companies), fifteen industry sectors, company size and Internet sales volume. This report is usually very long, but it provides a more accurate view of the survey data.
The CMO survey does not mention that it uses a representative sample of senior marketing leaders in US for-profit companies. Therefore, the results of the survey cannot be expected over the entire population.
In this series of posts, I will be discussing the responses of B2B marketers exclusively unless otherwise noted. Percentages and other numerical values in these publications are the medium of survey responses, also unless otherwise indicated.
Marketer optimism reaches pre-pandemic levels
On average, B2B marketers’ optimism has returned to pre-pandemic levels. The survey asked respondents to rate their level of optimism regarding the overall US economy on a 100-point scale, where “0” is the least optimistic, and “100” is the most optimistic. The following chart shows how B2B marketers rated their optimism in the five surveys conducted since August 2019.
However, it also appears that marketers’ optimism may be moderating. The August poll asked respondents if they were more or less optimistic about the overall US economy compared to the previous quarter. The following table shows how B2B marketers have responded.
Marketers’ optimism appears to be reflecting the overall economic growth trajectory in the United States. According to the Bureau of Economic Analysis, US real GDP grew at an annual rate of 6.3% in the first quarter of 2021 and at an annual rate of 6.7% in the second quarter.
The Conference Board currently expects real GDP to grow at an annualized rate of 5.5% in the third quarter and at 3.9% in the fourth. For the whole of 2021, the Conference Board projects real GDP growth of 5.9%, slowing to 3.8% in 2022.
Marketing Spending Status
A CMO survey includes many questions regarding the state of marketing budgets and spending that usually get a lot of attention. The survey asked respondents to estimate the percentage of the company’s total revenue represented by marketing expenditures. The following chart shows how marketers from B2B product companies and B2B service companies have responded to this question in surveys conducted since August 2019.
In a recent post, I discussed some of Gartner’s findings CMO Spending Survey, 2021. The “key” findings of this research indicated a significant reduction in marketing budgets as a percentage of a company’s revenue. Gartner found that the average percentage of total company revenue devoted to marketing in 2021 was 6.4%, down from 11% in 2020. The average percentage of B2B companies represented in the Gartner survey was 6.2%.
The chart above also shows a decrease in marketing spend 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 service companies.
In its survey report, Gartner treated the decline in the company’s ratio of marketing budgets to revenue as evidence that marketing budgets were being cut — or at least that they had not recovered from the cuts that took place last year. I don’t think the survey data supports this conclusion.
As a measure of ratio, it is clear that the percentage value is affected by both components of the ratio. The company’s marketing budget may have increased in absolute terms, but the percentage would still fall if the company’s revenue grew sufficiently in the same time frame.
The CMO survey provides a more direct measure of changes in marketing spending. The survey asked respondents to estimate the percentage of their total marketing spending change in the twelve months prior to the survey. The following table shows how B2B marketers have answered this question in the five surveys conducted since August 2019.
This table clearly shows that marketing spending at survey respondents’ companies slowed or decreased in the June 2020 and February 2021 editions of the survey. However, marketers at both B2B product companies and B2B service companies reported increases in spending in the latest survey.
My point is that this is one of those issues where averages are not particularly meaningful. In fact, the CMO survey found that changes in marketing spending vary greatly across industries. For example, in the August 2021 edition of the survey, respondents from banking, finance, and insurance companies reported an average increase of 20.2% over the previous 12 months, while respondents from manufacturing companies reported an average increase of only 3.6%.
In my next post, I will discuss more B2B findings from the August issue of the CMO survey.
Top image source: CMO . survey