The old saying “spend money to make money” seems paradoxical. But what if B2B CMOs could harness Forrester’s data and insights to show that’s exactly what high-growth companies are doing? Simply put, as they substantiate 2023 budget asks, CMOs should emulate the spend patterns of successful organizations.
Where to start? Marketing expense as a percentage of revenue. Forrester’s 2022 B2B Marketing Survey revealed that just over over half (51%) of enterprise companies that grew annual revenue by over 20% in 2021 invested 6.1% to 9% in marketing. Conversely, only one-third of enterprise companies that were flat to declining in annual revenue invested that range.
Where are they investing? According to the survey, the top three areas of investment that are most important for high growth companies to support their marketing strategy are:
1. Addressing Changing Buyer Behaviors
CMOs must insist on rigor to connect marketing efforts designed to drive reputation, create demand, drive post-sale engagement, and provide a personalized experience. The Forrester Campaign Framework is built for the purpose of connecting brand, demand, engagement, and enablement programs. This framework supports the entire customer lifecycle and coordinates core elements across the program families. With that planned 1% to 9% marketing budget increase, the largest allocation will go towards programs.
2. Implementing A Purpose-Driven Brand
Brand purpose is a statement of how an organization intends to change the world for the better and these days, all brands are being held to higher standards. Corporate social responsibility (CSR) has emerged as a strategic function with implications for the entire organization. Buyers and customers make decisions based on environmental, social, and governance (ESG) criteria, the best talent gravitates to companies that live their values, and investors are rewarding companies that lead on these issues. Our 2022 B2B Marketing Survey showed that brand and communications organizations’ number one focus to support continued high growth is to build a brand purpose that aligns to the brand vision, mission, and CSR goals.
3. Focus On Post-Sale Customer Engagement
B2B organizations must support post-sale customer engagement systematically to retain customers, grow existing accounts, and create advocates. This is something that high growth enterprise companies understand. In fact, 34% of marketing decision-makers who have management authority of customer engagement, plan to increase the budget for customer engagement headcount by 10% or more. The primary focus being tied between increasing the value of post-sale engagement programs by sharing customer experiences and demonstrating the impact of customer advocacy and references.
Our 2023 planning guide for B2B marketing executives provides more insight on where to invest in the coming year, as well as where to pull back and where to experiment. Clients can access the guide here and schedule a guidance session to discuss their specific challenges. (Not yet a client and want to learn more? Please reach out.)
Wishing you a simple “good luck” with your 2023 budget planning cycle would be disingenuous. I cannot emphasize enough that what lies ahead will require a spend-money-to-make-money approach. B2B CMOs can confidently request budget for the next fiscal year by emulating what other high growth companies have already managed to achieve. Even if all else fails, make sure to remind the naysayers that reactive, cost-saving decisions that satisfy the expectations of “now” could take years to undo, while having incalculable long-term impact on your brand, customers, employees, and other critical aspects of your business.