Sunday, February 19, 2017

How Small and Mid-Size Companies Will Practice Marketing in 2017

Target Marketing magazine recently published the findings of its annual "Media Usage Survey," which was designed to identify marketing spending plans for 2017. The survey was conducted in December 2016 and produced 725 responses from members of the audiences of Target Marketing and subscribers to Total Retail and NonProfit Pro magazines. The researchers suppressed participation by list services firms and creative services/advertising agencies so that all responses would be from marketers.

Forty-two percent of the respondents were affiliated with B2B companies, 36% with hybrid B2B/B2C companies, and 22% with B2C companies. Most of the survey respondents worked for small and mid-size companies:

  • 17% were with companies having $51 million or more in annual revenue
  • 22% were with companies having annual revenue of $5 million to $50 million
  • 50% were with companies having less than $5 million in annual revenue
Most of the respondents to the Target Marketing survey reported that their marketing budget for 2017 would the same or higher than in 2016. Thirty-seven percent said their 2017 budget would be higher, and 40% said their budget would stay the same compared to 2016. Only 15% of respondents said their marketing spending would be lower in 2017 than in 2016.

At larger companies, changes in marketing budgets showed greater variation. Fifty-one percent of respondents from companies with annual revenue of more than $50 million reported an increased marketing budget for 2017, while 20% of such respondents said they have a lower marketing budget this year.

Target Marketing also asked survey participants about the allocation of their marketing budget. The top four media categories identified by survey respondents were:
  1. Online marketing - on average, 36% of the total marketing budget
  2. Print (direct mail, magazines, newspapers, circulars, etc.) - 22%
  3. Live events - 19%
  4. Other - 13%
The report's authors noted that print experienced the biggest year-over-year change, falling from 29%  of the total marketing budget in the 2016 edition of the survey.

The survey also asked participants how their spending on specific marketing methods would change in 2017. The following table shows the top six marketing methods slated for spending increases this year:

Survey respondents reported that email marketing produces the best ROI for both customer acquisition and customer retention purposes. They also said that "Other" marketing methods produced the second strongest ROI for both acquisition and retention, and that direct mail produced the third-best ROI for both purposes.

The survey report did not indicate what marketing methods were included in the "Other" category. Given that these marketing methods command a significant percentage of the total marketing budget and produce strong ROI, it would be nice to know what specific methods the "Other" category encompasses.

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