[Research Round-Up] B2B Highlights from "The CMO Survey" - Part 1

Source:  "The CMO Survey" (Christine Moorman, 2022)

(This month's Research Round-Up is devoted entirely to the September 2022 edition of "The CMO Survey." This research has been conducted semi-annually since 2008, and it consistently provides a wealth of valuable information about marketing trends, spending and practices.)

The findings of the latest edition of "The CMO Survey" were released earlier this month. "The CMO Survey" is directed by Dr. Christine Moorman and is sponsored by Deloitte LLP, Duke University's Fuqua School of Business and the American Marketing Association.

The September 2022 survey results are based on responses from 273 senior marketing leaders at for-profit companies based in the United States. Over two-thirds (68.4%) of the respondents were affiliated with B2B companies, and 95.6% were VP-level or above. The survey was in the field from July 12 - August 4, 2022.

Dr. Moorman and her colleagues typically produce three reports for each edition of the survey.

• "Highlights and Insights Report" - This is a relatively brief and graphically-rich report that provides mostly overall survey results, along with an analysis of those results and major marketing trends.
• "Topline Report" - This report provides response data at the aggregate level for all survey questions.
• "Firm and Industry Breakout Report" - This report provides response data by four primary industry sectors (B2B product companies, B2B services companies, B2C product companies and B2C services companies), company size, and volume of internet sales. This report is quite lengthy, but it provides the most detailed view of the survey data.

In this post, I'll be discussing the responses of B2B marketers exclusively, unless otherwise indicated. The percentages and other numerical values in this post are the mean of applicable survey responses, also unless otherwise indicated.

Declining Economic Optimism

For the past several years, "The CMO Survey" has asked participants about their level of optimism regarding the overall economic environment. When the September survey was in the field, two economic issues were top-of-mind for most business and marketing leaders.

Inflation had been rising for several months and had reached a four-decade high in the spring of this year. To combat this inflation, the U.S. Federal Reserve had begun tightening monetary policy and had signaled that monetary policy would probably need to be restrictive for an extended period of time. As a result, fears that the U.S. economy is heading for a recession had increased substantially.

Under these circumstances, it shouldn't be surprising that B2B marketers have become less optimistic about the state of the economy. The survey asked participants to rate their level of optimism regarding the overall U.S. economy on a 100-point scale, with "0" being least optimistic and "100" being most optimistic. The following chart shows how B2B marketers rated their optimism in the five surveys conducted since June 2020.

As this chart shows, B2B marketer optimism reached a post-pandemic high in the August 2021 survey and has been slowly declining since.

The September survey also asked participants if they were more or less optimistic about the overall U.S. economy compared to the previous quarter. The following table shows how B2B marketers responded.

In the February 2022 survey, only 41.0% of respondents from B2B product companies, and 39.1% of those with B2B services companies said they were less optimistic about the U.S. economy compared to the previous quarter.

Marketing Spending Expectations

Perhaps because of their lower expectations regarding the performance of the economy, B2B marketers responding to "The CMO Survey" generally expect the growth of their marketing spending to slow or be flat in the coming year, although the survey revealed a notable difference between the views of marketers at B2B product companies and those at B2B services companies.

The survey asked participants by what percent their marketing spending had changed in the prior 12 months and by what percent they expected their spending to change in the next 12 months (relative to the prior 12 months). The following table shows how the B2B survey respondents answered these questions.

As the table shows, marketers at B2B product companies expect the growth of their marketing spending to slow substantially over the coming year (compared to the previous 12 months), while marketers at B2B services companies expect their spending to continue growing at about the same rate.

Changes in consumer spending patterns may partially explain these differing growth expectations. During the early part of the pandemic, public health measures caused consumer demand for many services (travel, dining out, etc.) to decline sharply. Many consumers responded by increasing their purchases of products.

As the impacts of COVID-19 began to wane, the pent-up demand for vacation travel, eating out and many other services was released. As a result, consumer spending on services has increased substantially over the past year or so, while spending on many types of products has slowed.

These changes in consumer spending patterns eventually impact the entire product/service value chain and ultimately affect the business conditions that B2B companies are facing.

***

In next month's Research Round-Up post, I'll discuss some of the other major findings from the September edition of "The CMO Survey."