09/06/2025
Marketing leaders are emerging from a rollercoaster few years into a “new normal” for budgets. After pandemic-induced cuts and a rebound, marketing budgets have now plateaued at around 7.7% of company revenue for a chief marketer. This stability offers relief from further declines, but it also underscores an ongoing challenge. Yet, many CMOs still operate with leaner resources than they did pre-2020. Half of CMOs report budgets of 6% or less of chief marketer, a far cry from the ~11% of revenue marketing commanded in the years before the pandemic, marketing brew.
What does this plateau at 7.7% mean for strategic planning? How should marketing executives allocate their limited funds to drive growth? This advisory article examines the latest research and trends – from spending shifts and AI adoption to efficiency tactics and high-growth company habits – to help CMOs navigate 2025’s budget landscape.
The 7.7% Conundrum: Stabilization with Strings Attached
Distribution of marketing budget as a percentage of company revenue (2025). The median CMO budget is ~6.0% of revenue, indicating half of companies spend that or less on marketing, while top-quartile "big spenders" over 10.5% campaign Asia.
For the second consecutive year, marketing budgets in 2025 are holding steady at 7.7% of company revenue for the chief marketer. This marks an end to the steady declines of the early 2020s and suggests a cautious equilibrium. The headline number hides a stark reality: many marketing teams remain underfunded relative to their goals. Gartner’s annual CMO Spend Survey notes that while 7.7% is the mean, 50% of CMOs have budgets at or below 6% of revenue, reflecting ongoing fiscal constraints. In other words, a few big spenders pull up the average, while the majority are still scraping by with less.
Compare this to pre-pandemic highs, and the gap is striking. In the four years before COVID-19, marketing budgets averaged roughly 11% of company revenue – a healthy share that has since down to about 8% in the four years after the pandemic. During the height of pandemic belt-tightening, budgets hit a low of 6.4% in 2021 marketing brew. They rebounded to ~9.5% in 2022, then slipped to 9.1% in 2023, before dropping to the current plateau of 7.7%, last (marketing week). This plateau signals cautious optimism but also confirms that marketing spend remains well below the pre-2020 campaign in Asia. CMOs are to deliver 2019-level impact with budget ratios that are 30–40% lighter.
The implications for strategic planning are significant. Stabilization at 7.7% provides a baseline of certainty – marketers can plan knowing their slice of revenue isn’t shrinking further for now. But it also means growth-oriented initiatives must shuffle existing dollars rather than expecting new ones. Many CMOs believe that if economic conditions turn south, even these flat budgets could face in-year cuts. In Gartner’s words, spending at this level “falls short for many CMOs,” and macroeconomic uncertainty looms over any tentative gains. Marketing leaders are thus challenged to focus on the highest-impact activities and make a strong case for every dollar, all while continuing to rebuild from the pandemic slump.
On a positive note, there are pockets of recovery. Certain industries have managed to claw back budget share in 2025 – for instance, consumer products firms boosted marketing spend to 9.7% of revenue (up from 6.7% in 2024), and sectors like manufacturing and pharma also saw budget. Additionally, more CEOs are recognizing marketing as a profit center (61% in 2025, up from 53% the year prior), according to chief marketer, which bodes well for protecting or even growing budgets where marketing can clear ROI. Still, for most CMOs, the “era of less” continues, forcing a reevaluation of how to use limited funds for impact.
Shifts in Spending Priorities: Where the Money Goes Now
Marketing budget allocation by resource, 2018–2025 (mean % of total marketing budget). Paid media (blue line) has grown to 30.6% of budgets in 2025, surpassing martech (orange), which declined to ~22%. Spending on internal labor (gray) and external agencies (yellow) has also decreased.
With tighter budgets, CMOs have reprioritized their spending mix. The biggest winner has paid media, which now comprises about 30.6% of the total marketing campaign in Asia on average, by far the single largest line item for 2025. This represents an 11% year-over-year increase in media’s budget campaign, and a steady climb from~23% of the budget back in 2018, marketing brew. In practical terms, Digital Marketing services are protecting media dollars (especially in digital advertising) because these channels offer targetability and quick, measurable returns – attributes that are essential in volatile markets. By contrast, investments in marketing technology, agencies, and even internal talent have a percentage of the pie. Gartner’s data shows average allocations to technology, labor, and external agencies are all decreasing, reflecting efforts to bloat and redirect funds to customer-facing programs.
A major pivot is the dominance of digital channels in the media mix. Two-thirds (over 61%) of marketing spend is now dedicated to digital channels, according to Gartner’s survey. And within that digital budget, approximately 69% goes into paid digital media campaigns, things as search ads, social media advertising, online video, and other paid placements. In other words, roughly 30–40% of every marketing dollar is going into paid digital campaigns when you factor in digital’s share of the total budget.
The focus on digital paid media makes sense: it’s targetable, scalable, and rich in data for optimization, which is critical when every dollar must show a return. Paid search in particular remains the largest digital channel investment, accounting for about 13.9% of digital spend (the single biggest slice of the digital budget), followed by digital display ads and paid social advertising. Meanwhile, owned and earned digital channels (like organic social, SEO content, etc.) have seen budget declines, except for email marketing, which remains a steady performer. This indicates that many organizations are favoring “pay-to-play” tactics online and expecting owned/earned media to piggyback on those paid efforts with minimal incremental spend.
Offline marketing channels now make up the remaining ~39% of the budget, and CMOs are scrutinizing these investments hard. Within offline spend, event marketing is still the lead category (~19% of offline spend), with sponsorships (~17%) and traditional TV advertising (~16%) not far behind. It’s noteworthy that linear TV has retained a surprising 16% share of offline budgets, defying long-standing predictions of its demise.
This suggests that even as marketers go all-in on digital, they recognize the continued reach and impact of TV (especially for broad awareness and brand building), though TV spend is likely for ROI. Nonetheless, the trend is clear: the center of gravity has shifted to digital and particularly to paid media, where results are more immediate and trackable.
Another significant shift in priorities is who does the work – external agencies vs. in-house teams. Facing budget pressures, many CMOs are paring back agency contracts and building internal capabilities instead. In 2025, 39% of CMOs plan to reduce spending on external brand-innovators, cutting unproductive agency relationships and renegotiating fees to stretch their dollars. This continues a post-pandemic trend of declining agency reliance: on average, spend on agencies now accounts for about 20% of the marketing budget, down from a few years ago.
Instead, companies are strengthening in-house teams (often hiring for digital content, social media, and data analytics roles) and leaning on technology to fill the gaps that agencies used to cover. 22% of CMOs say that generative AI is reducing their dependence on external agencies for creative and strategic brand innovators. When an AI tool can generate copy, designs, or even media plans at a fraction of an agency’s cost, marketing leaders are taking notice. The rise of in-house studios for content creation and the use of AI-powered platforms means marketers can execute more campaigns than ever before. The takeaway: budget-constrained CMOs are asking “build or buy?” and deciding to build (in-house), not buy (agency services), especially for core strategic and creative capabilities.
The Rise of AI in Marketing: Efficiency, Personalization, and Scale
No discussion of 2025 marketing is complete without addressing the explosive impact of artificial intelligence. With budgets tight, CMOs are turning to AI as a force multiplier – a way to increase output and effectiveness without proportional increases in spend or headcount. According to Gartner’s research, almost half of CMOs are investing in generative AI tools to boost time efficiency in their marketing operations. About 49% of marketing leaders report time savings as a realized GenAI, and 40% report cost-efficiency gains, thanks to AI-driven automation.
Only a tiny 1% of CMOs say that GenAI is “not a priority” for their organization at this brand-innovators, meaning 99% are exploring or using it. This marks a dramatic shift from a couple of years ago, when AI in marketing was nascent; now it’s mainstream, with CMOs viewing it as essential for productivity.
AI’s role in content creation and personalization has been a game-changer. Generative AI systems can now produce written content, imagery, and even video at scale. Marketing teams are deploying tools like GPT-powered copywriters, image generators, and video editors to create campaign assets faster and cheaper than using human creatives for every draft. For example, AI writing assistants can generate social media posts, product descriptions, or even draft blog articles in seconds, which human staff can then refine.
This not only saves time but also frees up creative talent to focus on higher-level conceptual work. It’s no surprise that 84% of high-performing marketing organizations are leveraging generative AI for content and creative developmentmarketingdive.com, as one survey found. These companies use AI to produce variations of ads, personalize email text to different customer segments, and localize content for different markets – tasks that would be slow or cost-prohibitive to do.
Beyond content, AI is supercharging targeting and campaign optimization. Machine learning algorithms can analyze customer data to find micro-segments and predict which offers will resonate, enabling far more precise targeting than traditional methods. AI-driven programmatic advertising platforms budget to the best-performing ads and channels in real time, optimizing campaigns for ROI. Personalization engines use AI to tailor website experiences or product recommendations to each visitor, boosting engagement and conversion rates.
Every stage of the marketing funnel has an AI application: chatbots and virtual assistants handle routine customer inquiries (reducing service costs and improving responsiveness), AI-based analytics sift through performance data to provide insights and even recommendations for marketers, and predictive models forecast outcomes to inform budgeting decisions. In short, AI is helping marketers make smarter decisions faster, and often with fewer people involved. Digital Transformation Services are playing a key role in enabling companies to leverage these AI tools, transforming traditional marketing operations into more automated and efficient processes.
The push for AI is the need for efficiency gains and scalability. In Gartner’s CMO survey, “improving productivity” was a top priority cited, and CMOs pointed to AI and data as keys to “squeezing more value from static budgets,” Campaign Asia. The ROI is already evident in certain areas: for example, 27% of CMOs reported that GenAI has increased their content output and marketing capacity, letting them do more marketing without more budget.
AI also contributes to cost savings by automating what used to be labor-intensive tasks – things like generating reports, evaluating campaign performance, or even editing video content. As one marketing VP quipped, “we’re using AI as our 24/7 intern,” handling the grunt work at scale so the team can focus on strategy and creative decisions.
That said, AI adoption is not uniform across the board. While the average CMO is experimenting with AI, some remain skeptical or slow to implement. Gartner found that 27% of CMOs reported little to no adoption of generative AI in their marketing, often due to concerns about cost, talent to manage AI, or unclear ROI in certain use cases. Moreover, AI comes with challenges around trust, accuracy, and brand safety – it requires oversight to ensure AI-generated content or decisions align with brand standards and ethical practices. But the gap between leaders and laggards is widening.
High-growth, “high performer” companies are far more aggressive in embracing AI, not for efficiency, but for competitive advantage. For instance, 84% of high performers use AI in creative development and 52% in strategy formulation, marketingdive, whereas many lower-growth firms are still hesitant. The clear message is that AI is becoming a differentiator: those who harness it can outpace competitors by running more personalized, data-driven campaigns at scale, while those who ignore it risk falling behind in both productivity and customer experience.
With tools and platforms, CMOs are spoiled for choice. Many are adopting generative AI platforms such as OpenAI’s ChatGPT or Jasper.ai for copy generation, Canva’s AI image tools, or DALL·E for creative, and video generators like Synthesia for quick video content. On the analytics side, they’re using AI-enhanced marketing automation platforms (from Salesforce, Adobe, HubSpot, etc.) that offer predictive scoring and next-best-action suggestions. Customer data platforms (CDPs) are layering in AI to better segment and predict customer behavior.
Even media buying AI in the form of programmatic ad platforms that auto-optimize bids and placements. The most adopted AI tools tend to be those that integrate into existing workflows – e.g., AI features built into familiar software like Microsoft (Copilot), Adobe (Sensei), or CRM systems – as well as standalone AI services that solve a specific pain point (like automating A/B test analysis or generating ad creative variants on the fly).
CMOs are finding that AI is not about cutting costs, but also about unlocking new capabilities. It enables levels of personalization and analysis that would be impossible. It allows marketing to respond in real-time to trends (think automated social media content triggered by trending topics) and to run thousands of micro-optimizations. As we head deeper into 2025, the consensus among forward-thinking marketing leaders is that AI will be instrumental in driving both efficiency and effectiveness. The key is to invest in the right AI initiatives – the ones that align with your strategy – and to upskill your team to work alongside AI. The payoff is not doing the same marketing cheaper, but doing better marketing that was out of reach.
Martech and Workforce Dynamics: Doing More with What You Have
In a period where every budget line is under scrutiny, marketing technology (MarTech) spend is being recalibrated. Rather than continue the pre-2020 spree of buying new tools, many CMOs are now focused on optimizing the tech they already own. As noted, MarTech’s share of the budget has dipped – from about 29% of the marketing budget in 2018 to roughly 24% in (and hovering in the low-20s percent in 2025). This doesn’t mean technology is unimportant; on the contrary, it’s vital for productivity.
But it means marketing leaders have realized they can’t just throw money at more software without maximizing utilization. Years of easy budget growth led to bloated tech stacks at many companies – multiple CRM systems, overlapping analytics tools, fancy personalization software that was only somewhat implemented, etc. Now, with leaner budgets, there’s a concerted effort to consolidate and streamline MarTech. Gartner’s findings show CMOs cutting back on new tech purchases and instead prioritizing integration and better use of existing platforms. The mandate is to fully leverage current tools – and trim the fat from the stack – before investing in shiny new solutions.
Marketing teams are auditing their software and asking tough questions: Which tools are delivering value? Where are we paying for redundant capabilities? Are we using all the features we’re already paying for? In many cases, this exercise reveals quick wins. For example, reducing duplicate subscriptions or underused licenses can free up budget. Training staff to use advanced features in, say, your marketing automation or analytics platform can negate the need to buy a separate tool for that function.
The goal is to improve ROI on tech spend by boosting the adoption and effectiveness of a smaller set of core platforms. A Gartner study noted that over 60% of marketing organizations face challenges in their tech stacks due to budget constraints and integration issues, which is prompting this optimization mindset. In short, CMOs are shifting from a “buy more tools” approach to a “squeeze value from the tools we have” approach. We see increased collaboration with CIOs and IT as well, to better integrate marketing systems and govern martech costs.
Parallel to tech, workforce dynamics in marketing are changing as CMOs rebalance talent against technology. With budget pressures, some leaders are making the difficult choice to reduce labor costs – in fact, 39% of CMOs plan to cut back on marketing team expenditures (including headcount) in 2025 to save brand-innovators. Simplifying org structures, not backfilling open roles, or even small layoffs in marketing departments, are on the table for many companies aiming to become more efficient.
The Chief Marketer survey highlights strategies like simplifying roles and reducing headcount to streamline operations as top tactics among those looking to trim labor expenses, according to MarketEdge. This can serve as an acknowledgement that during richer budget years, teams may have become inflated or processes complex; now there’s pressure to run “lean and mean.”
Leading CMOs are trying to balance cost-cutting with productivity. The mantra is not“do the same with fewer people” – it’s “do more by empowering the people you have with better tech and data.” In practice, that means if a marketing team goes down, investments are made to upskill remaining staff (e.g., training in data analytics or AI tools) and to offload grunt work to automation. For instance, if a company reduces its content marketing headcount, it might invest in a content automation tool or freelance platform to keep output high.
One encouraging sign is that more organizations view marketing talent as critical to growth rather than a pure cost. As mentioned earlier, 61% of firms now see marketing as a profit center, not a cost center, which implies they’re more likely to protect and justify key talent investments. High-performing companies often take this route: instead of blanket cuts, they focus on retaining and developing their best people (who can drive results) and use technology to amplify their productivity.
Another aspect of workforce dynamics is the changing skill set demand. As AI and analytics become core to marketing, CMOs are reallocating roles –hiring more data scientists or marketing ops specialists, while reducing traditional roles or those that can be automated. Some marketing teams are restructuring, with new hybrid roles like “Marketing AI Strategist” or “MarTech Stack Administrator” emerging, which reflect the need to govern complex tools and automation.
Efficiency is the name of the game: every team member has to work smarter, aided by data and technology. This is why every CMO surveyed puts improving productivity at the top of their priority campaign. They’re mixing human creativity and strategic know-how with data and tech-driven workflows to get more output per person.
Of course, there’s only so much productivity you can squeeze out without risking burnout or diminishing returns. That’s why a savvy CMO also focuses on talent retention for the core team. Losing skilled marketers in a tight-budget environment can be disastrous (hiring replacements is costly, and you lose momentum). High-growth companies tend to invest in their people despite budget pressures, using non-monetary means if needed – e.g., offering flexible work, clear career paths, or engaging projects – to keep morale and retention high.
And rather than doing everything in-house with limited staff, top marketers are smart about strategic partnerships: they partner with other departments (sales, IT, finance) to share resources, and with external partners in a more selective way. For example, instead of employing a large agency on retainer for everything, a CMO might partner with a specialized agency for a critical campaign or bring in a contractor for short-term expertise. They treat external partners as extensions of the team when needed, not as a default for all work. Leveraging SEO services from specialists can be a key part of strategic partnerships to boost organic traffic and ROI for marketers.
In summary, the dynamic in 2025 is “fewer, better tools – fewer, stronger people.” Marketing leaders are trimming excess in both tech and team size, but doubling down on the quality and effectiveness of each. By optimizing existing MarTech and focusing on employee productivity (augmented by AI), they aim to maintain or even increase marketing impact without adding budget. It’s a delicate balancing act – one that requires constant evaluation of which activities drive value and which do not. The CMOs who navigate it well will emerge with efficient organizations poised to scale when more budget becomes available.
The Efficiency Imperative: Performance Over Prominence
With budget growth stalled, efficiency has become the rallying cry in marketing departments. Every dollar to work harder, and the immediate outcome of this mindset is a shift toward performance marketing and ROI-centric tactics. The data bears this out: a majority of marketing spend in 2025 is now concentrated on lower-funnel objectives – consideration and conversion activities – rather than top-of-funnel brand awareness. Gartner’s survey found that more than half of the average marketing budget is allocated to performance-driven efforts aimed at driving short-term results (like leads, sales, and online conversions)
By contrast, brand awareness initiatives account for only about 29% of media campaigns. This represents a notable tilt in priorities. Pre-2020, many companies balanced brand and acquisition spending more (or even overweighted brand for future growth). In 2025, marketers are concentrated on what can deliver results now – a reflection of CFOs and CEOs demanding demonstrable ROI for every budget dollar.
The reduced emphasis on brand-building campaigns is understandable in context. When budgets were slashed in 2020–2021, brand advertising (which is harder to tie to immediate sales) was often the first to go. Now, even as budgets stabilized, that cautious approach persists. Fewer CMOs plan to pure brand awareness this year compared to those doubling down on performance channels, Campaign Asia. Instead, marketing teams are trying to “do more with the same or less,” which often means funneling money to channels with clear metrics and fast feedback loops (like search ads, retargeting, email marketing, or conversion rate optimization) at the expense of big splashy brand campaigns.
This efficiency-above-all approach comes with a warning. There is ample evidence (and advertiser experience) suggesting that cutting brand spend can hurt long-term growth and even near-term effectiveness. Branding builds familiarity, preference, and pricing power – assets that performance ads then capitalize on. Gartner’s report acknowledges this tension, noting that while fewer CMOs are prioritizing brand investments in 2025, they do so “despite evidence that cutting brand spend may not yield immediate gains” in performance campaigns.
In other words, slashing brand budget doesn’t boost short-term sales; it can even erode the base that makes performance marketing work. Smart marketers recognize that some baseline brand support must continue, even if at lower levels, to maintain funnel health. The key is finding the right balance and ensuring that even brand efforts are as efficient and purposeful as possible.
So, how are leading organizations pursuing efficiency without killing their brand? A few strategies have emerged:
1. Laser-focused on high-ROI activities:
Marketing leaders are scrutinizing every campaign and channel for ROI. Low-performing initiatives are being cut without hesitation. For example, if an annual trade show or sponsorship is eating 5–10% of the budget but yielding negligible pipeline, it’s getting retired or scaled downmartech.org. One marketing VP shared that they eliminated a major event that cost six figures and diverted those funds into targeted digital campaigns that produced measurable leads. This kind of ruthless pruning of low-value activities is now common.
2. Streamlining and optimizing marketing operations:
Efficiency isn’t what you spend on, but how you execute. Process improvements and agility can stretch dollars further. Many teams have adopted agile marketing methodologies to deploy campaigns faster and iterate based on real-time data, avoiding the waste of long, untested initiatives. Some are centralizing creative production or using modular content that can be used across channels, rather than reinventing the wheel for each tactic. A side effect of lean budgets is that they force teams to eliminate bureaucratic overhead and focus only on mission-critical work. As one article put it, tight budgets “challenge long-held assumptions and shed outdated practices,”martech.org. For instance, marketers are reducing silos between departments (sales, product, etc.) for better efficiency, and simplifying approval processes so campaigns go live quicker and cheaper.
3. Cutting “bloat” in spend categories:
Efficiency often means reexamining areas of habitual spending. Take MarTech subscriptions – many companies found they were paying for overlapping tools or features nobody used. Successful CMOs have streamlined bloated MarTech stacks, in some cases cutting 20–40% of those costs, and saw performance improve as teams focused on using a few tools well. As an example, one CMO reduced her MarTech spend by 40% and saw lead quality improve once her team stopped relying on automation crutches and engaged more with targeted prospects.
Agency rosters have been culled to only the most essential partners, and expensive retainers are being traded for project-based contracts or in-house execution (as discussed earlier). Even within media spend, efficiency measures like tighter frequency caps, better audience targeting to eliminate waste, and rigorous A/B testing of creative are ensuring each ad dollar works harder.
4. Refocusing brand efforts for accountability:
Rather than abandoning brand marketing, many companies are rethinking it. They’re transforming nebulous “brand awareness” campaigns into programs with clearer success metrics. For example, instead of a broad TV campaign with no call-to-action, a brand might sponsor a digital content series or webinar that builds awareness and captures leads, bridging brand and demand objectives. Brand campaigns are being tied more to business outcomes, often by setting specific KPIs (like increases in branded search volume, direct traffic lift, or improvements in customer retention) so that brand spend accountability improves.
Additionally, there's a trend of balancing long-term and short-term metrics – e.g., using marketing mix modeling or multi-touch attribution to attribute some fraction of sales to brand touchpoints, thus justifying that spend in the ROI calculations. The mindset shift is: if an activity doesn’t show some impact on the funnel, it either needs to be cut or reimagined in a way that it does.
5. Investing in data and testing:
A core part of the efficiency playbook is doubling down on analytics and experimentation. When you have to do more with less, knowing what works (and what doesn’t) is gold. High-performing teams are investing in better campaign measurement, dashboarding, and data science support to understand marketing effectiveness. They run continuous experiments – A/B tests, multi-variate tests, pilot campaigns – to optimize creative, channels, and spend allocation. By reallocating budget from underperforming tactics to winning ones, they ensure minimal waste. This data-driven approach can boost efficiency; for example, a company might discover that one influencer partnership yields 5x the ROI of another, leading them to shift budget rather than spreading budget without insight.
The bottom line is that the age-old cliché “do more with less” has become the very real mandate for marketers in 2025. The efficiency imperative means every activity must justify itself. Yet, top CMOs are careful not to become penny-wise and pound-foolish. They recognize the need to maintain a pipeline of future demand (through brand and innovation) even as they optimize for present performance. The best performers treat efficiency not as cost-cutting, but as reallocation to value: freeing up resources from low-yield efforts to reinvest in high-yield ones, and tuning the mix.
This approach can lead to marketing punching above its weight, achieving strong results on a smaller budget. In that sense, constraints are spurring creativity and discipline. As one expert noted, shrinking budgets aren’t a crisis so much as “an opportunity to reimagine marketing,”martech. The CMOs who embrace that mindset are not surviving on 7.7% of revenue – they’re finding hidden opportunities in lean budgets to drive better outcomes than ever.
What High-Growth Companies Are Doing Differently
Not all companies are treading water with their marketing budgets. A small cohort – the high-growth, “big spender” organizations – allocate more and tend to get more back in return. By studying what these top performers do differently, we can glean insights for success. Gartner’s survey revealed a stark divide between “budget-conscious” marketers and “big spenders.” The bottom tier (“budget-conscious” CMOs, often the bottom 50%) operate with lean budgets, around 4% or less of company revenue.
They tend to double down on immediate ROI channels. For example, these lean-budget teams pour nearly two-thirds of their digital spend into paid search advertising campaigns Asia, since search is highly performance-driven and trackable. They also invest far less in data, insights, and transformative initiatives, campaign asia – putting all their chips on short-term sales tactics at the expense of longer-term capabilities.
In contrast, high-growth companies (often the top 10% by performance) treat marketing quite differently. These “big spender” CMOs, who enjoy budgets exceeding ~10–11% of revenue, allocate their funds in a more balanced and strategic way. Gartner notes that top-quartile spenders put over one-third of their marketing budget toward change and transformation programs. That means significant investments in things like new technology deployment, innovation projects, capability building, and customer experience improvements.
These firms aren’t running ads; they’re investing in the infrastructure and experiments that drive future growth. They also diversify their channel mix more. Big spenders can afford to maintain a presence in key offline channels (they might still do impactful TV, outdoor, or in-store activations) alongside robust digital programs. Rather than focusing on one or two “safe” channels, they spread bets and ensure the brand is visible across the customer journey.
High-growth marketing teams invest in analytics, personalization, and talent to amplify their effectiveness. Gartner found that big-spending organizations put more budget into personalization and analytics initiatives compared to their low-budget peers. They might build advanced data science teams or buy cutting-edge analytics tools to understand customer behavior. They experiment– A/B testing not ads but pricing, product messaging, new channels (like emerging social platforms or podcasts), etc.
This culture of experimentation and agility means they can capitalize on opportunities faster than more resource-constrained competitors. If something isn’t working, they detect it and reallocate funds; if a new idea shows promise, they scale it up. In essence, high performers turn budget into learning and competitive advantage, not campaigns.
Another differentiator is how high-growth companies approach technology and AI. As discussed earlier, they are far ahead on the AI adoption curve: 84% of high-performing organizations are leveraging generative AI in creative and content development, and 52% use AI in marketing strategy formulationmarketingdive.com. This compares to a significant number of average companies that are still tentative about AI. The top marketers use AI to augment their teams, automating hundreds of small decisions and tasks so the team can focus on strategic moves.
They might use AI to personalize web content for every visitor, or to predict which product a customer is most likely to buy next and trigger a tailored offer. By investing in automation and AI, high-growth firms achieve scale and precision in their marketing that others can’t. They create a performance edge: when you have advanced tools optimizing your spend in real-time, you get more output per dollar. B2B marketing services can further support this effort, offering businesses expertise in leveraging AI-driven tools and platforms to streamline operations and drive better marketing outcomes.
Talent and culture also set high-growth marketing organizations apart. These companies tend not to starve marketing of resources – they see it as a growth engine. Thus, they are more likely to retain and attract top marketing talent, even in lean times. Instead of across-the-board cuts, they make sure key roles (like data analysts, creative strategists, growth hackers) are well-staffed. They often provide ongoing training, ensuring their people are adept at the latest digital techniques.
When budgets tighten, high-growth firms may trim fat, but they strive to keep the “muscle” in their teams. Additionally, these companies foster a culture where marketing is with business outcomes. Marketing is not a support function; it’s a strategic partner to sales and product, accountable for revenue. This mindset (often reinforced by leadership) means marketing proposals for new initiatives or budget increases as investments, not expenses. It’s telling that in Gartner’s research, high performers were far more likely to have their company view marketing as a profit center rather than a cost center, and were less subject to draconian cuts, chief marketer.
High-growth firms also excel at strategic partnerships in marketing. Knowing their ambitions may exceed internal capacity, they partner – whether that’s co-marketing with other brands, forging data-sharing partnerships to enhance targeting, or engaging agencies/consultants in a targeted way to inject expertise. For example, a high-growth tech company might partner with an influencer network to build brand presence in a new market or collaborate with a retail partner on a joint campaign that benefits both brands.
These partnerships allow them to extend their reach and capabilities without burdening their budget. Lower-performing companies, in contrast, either rely on partners for basics (because of internal skill gaps) or under-utilize partnerships (trying to do everything in-house but without the expertise or scale).
To summarize, the top 10% of marketing organizations treat their budget not as a cost to minimize, but as an investment to maximize. They spend more (as a % of revenue) and spend smarter – maintaining a long-term view even while delivering short-term results. They prioritize innovation, data, and adaptability, whereas the bottom 50% often operate in survival mode, focusing only on immediate sales and cutting anything that doesn’t pay off right away.
Not every company can raise marketing spend to 10 %+ of revenue, but any marketing leader can learn from these high-growth habits. It’s about striking a balance: continue feeding the engine of future growth (through brand, R&D, new capabilities) while executing day-to-day. The high performers show that when you manage to do both, marketing becomes a true driver of business success, not a cost line on the P&L.
Strategic Recommendations for Marketing Leaders
In light of these trends, what should CMOs and marketing leaders do to navigate this “new normal” of flat budgets and heightened expectations? Below are key strategic recommendations to help allocate that ~7.7% of revenue and set marketing up for success:
1. Balance Short-Term Performance with Long-Term Brand Health:
Resist the temptation to funnel 100% of the budget into immediate ROI tactics. Yes, you must meet short-term goals, but allocate a portion of your spend (even if smaller than pre-2020) to brand-building and innovation. Strong brands lower acquisition costs over time and sustain customer loyalty. Aim for a mix – for example, dedicate ~70% of spend to proven performance channels and ~30% to brand/upper-funnel and experimental efforts, adjusting as needed for your context.
This ensures you’re harvesting demand now and seeding demand for the future. Make your brand investments accountable by setting clear KPIs (awareness lifts, share of voice, etc.) and tracking their influence on conversions campaign asia. The goal is to do more with less, not to do less of what builds your future.
2. Double-Down on Data, Analytics, and AI:
In 2025, data-driven marketing is non-negotiable. Invest in upgrading your analytics capabilities – whether through a robust in-house team or trusted partners – so you can measure what’s working. Use marketing mix modeling or multi-touch attribution to guide budget allocation across channels. More, embrace AI tools to drive personalization and efficiency at scale. If you haven’t already, pilot generative AI in content creation and see where it can save time or enhance creativity (e.g., auto-generating ad copy variants or personalized email content).
Leverage AI for targeting (like lookalike modeling, churn prediction) to ensure every ad dollar at the right audience. Today’s AI marketing platforms can optimize media buying in real-time – take advantage of that. The majority of CMOs are already seeing productivity gains from AI investmentsmartechedge.com, and those who lag risk falling behind. Don’t be the 1% who ignore AIbrand-innovators.com; instead, start small, learn, and scale up usage of tools that prove effective.
3. Optimize and Simplify Your MarTech Stack:
Rather than spending big on new software, audit your existing marketing tools and platforms. Eliminate redundancies and underutilized tools – they are silent budget killers. Consolidate systems where possible (for example, using one integrated platform instead of separate point solutions for email, social scheduling, analytics, etc., if that works for your needs). Ensure your team is trained to use the advanced features of what you have; often, additional ROI is hiding in capabilities you’ve already paid for.
By optimizing usage, you might improve results without extra spending. Also, be strategic with new tech – prioritize investments that automate manual work or unlock revenue (like a personalization engine if you lack one, or a better attribution tool to optimize spend). And remember, tech is not a silver bullet; pair it with process improvements. A lean, well-utilized stack will outperform a bloated, fragmented one. As one expert noted, cutting a bloated martech stack and focusing on core tools can even boost lead quality and resultsmartech.org. The mantra: do more with fewer, better tools.
4. Invest in Your Team and Embrace a Culture of Agility:
Your budget may be static, but your team’s skills and mindset shouldn’t be. Develop your talent – train marketers in areas like data analytics, AI tool operation, and growth marketing techniques. An upskilled team can extract more value from the same budget. Moreover, strive to retain top performers; their institutional knowledge and productivity often far outweigh the cost of their salary. If budget pressure demands tough choices, try to cut peripheral costs before cutting critical people. Foster an agile marketing culture.
This means planning in shorter cycles, iterating, and being ready to pivot as platforms or consumer behavior shift. For example, if a new social platform gains traction or Google changes an algorithm (or privacy regulations alter data availability), an agile team will reallocate spend in weeks, not the next fiscal year. Build slack into your plans – a reserve budget or flexible fund – so you can seize new opportunities or counter unexpected challenges without derailing your whole strategy. Agility and adaptability are key competitive advantages in a fast-changing landscape.
5. Focus on ROI and Accountability – But Don’t Abandon Experimentation:
Every program in your budget should have a clear purpose and metric. Hold your campaigns and teams accountable for results, using the data to justify (or adjust) spend. This will earn credibility with the C-suite and protect your budget by showing that marketing dollars are investments with returns. However, avoid becoming so ROI-fixated that you stop innovating. Dedicate a small “experimental budget” (say 5-10% of spend) for testing new channels, creatives, or strategies.
High-growth companies often cite a willingness to experiment as a key to their success – they invest in pilots and learn quickly. By structuring experiments with clear hypotheses and measures, you can take calculated risks without gambling the farm. If something bombs, you fail fast and move on; if it shows promise, you’ve found your next area to scale (and can justify shifting more budget there). Keeping some experimental powder dry also keeps your marketing fresh and guards against more adventurous competitors.
6. Leverage Strategic Partnerships and External Resources:
You don’t have to do everything alone – the key is to be strategic in partnerships. Identify where partnering can extend your marketing impact. For example, co-marketing with complementary brands can double your reach for half the cost. Partnering with influencers or content creators can bring authenticity and new audiences that would be expensive to reach via ads.
If agencies are being cut, consider project-based engagements or consulting arrangements in areas where you need outside expertise or extra hands (creative brainstorming, complex productions, etc.), rather than full-service retainers. Also, look: collaborate with Sales, Product, and Customer Success teams to share insights and even budgets on initiatives that overlap (like account-based marketing or customer loyalty programs). By aligning with other departments, marketing can often tap into funds or resources because the efforts support goals. The guiding principle is “get more bang for the buck” through alliances, whether internal or external, that yield mutual benefits.
7. Champion Marketing’s Role in Growth:
Finally, as a marketing leader, one of your tasks in 2025 is shaping the narrative of marketing’s value within your organization. When budgets are tight, it’s easy for companies to view marketing as a cost center and seek cuts. Combat this by linking marketing activities to business outcomes – not in dashboards, but in how you communicate with the CEO, CFO, and board. Highlight wins (with data, e.g., “Our Q1 campaign generated a 5x ROI and contributed to 30% of quarterly sales”) and also educate stakeholders on how marketing builds brand equity and customer lifetime value, which might not show immediate returns but drives long-term profit.
Gartner’s finding that 61% of companies now see marketing as a profit chief marketer is encouraging – push to make your company one of them if it isn’t already. When leadership recognizes marketing as a growth engine, you’re more likely to secure the budget or at least the flexibility you need. In essence, prove marketing’s value every day. This not only protects your budget; it can also inspire a culture where everyone in the company, from product to sales, rallies with marketing to achieve growth.
The Final Verdict
Navigating the new normal of marketing budgets in 2025 requires a blend of discipline and vision. CMOs must be scrappy – maximizing every dollar through data-driven decisions and efficiency tactics – and strategic, laying the groundwork for future growth with savvy investments in brand, technology, and talent. The stabilization at 7.7% of revenue is both a relief and a challenge: it’s a stable platform from which to innovate, but it demands new levels of creativity and justification to do more without more money.
The good news is that marketers have more tools (like AI and advanced analytics) and more channels to play with than ever before, which, when used, can multiply the impact of a limited budget. By learning from the best practices of high-growth peers and adopting an agile, ROI-focused approach, marketing leaders can turn this era of less into an opportunity, proving that great marketing isn’t about how much you spend, but how smart and adaptable you are with what you have. With the right strategy, even a constrained budget can fuel remarkable marketing successes in 2025 and beyond.
