In today’s business, staying ahead is more than just planning ahead. Both planning and reorientation are required to drive short-term results and long-term business growth. The pressures and uncertainties of the global economy make it increasingly important for marketers to balance early planning with the need to remain agile.
To maximize your return on investment (ROI), your marketing and finance teams must work closely together to allow flexibility in how resources and budgets are managed. This allows us to move our investments where the greatest opportunity exists.
Key Marketers Are Budget-Agile
To explore digital marketing agility specifically, Google recently partnered with Kantar to survey over 2,400 global marketers to understand their approach to planning, allocating and optimizing their digital budgets. Nearly a quarter of marketers surveyed are considered “budget nimble”. That means we adjust our budgets weekly or more frequently across our digital channels. The budget agile marketer also reports better marketing his performance than other marketers. His 48% of budget-aware marketers said his marketing performance exceeded internal expectations and key performance indicators (KPIs), compared to 33% of non-budget agile marketers.
Budget agility does not mean “unprepared.” Thirty-one percent of budget-agile marketers involve strategy and digital media budget allocations in their formal marketing plans each month, compared to 18% of non-agile marketers.
Agility allows marketers to flex their plans and reallocate budget to areas that are more likely to improve ROI. His 31% of budget-savvy marketers said they could “very easily” get additional budget to launch tests that weren’t included in their original media budget.
Having the flexibility to work on your plans while leaving room for new improvements and growth opportunities can produce better business outcomes. A budget agile marketer is 25% more likely than a non-agile marketer to report outperforming his industry competitors.
Most Marketers Overestimate Budget Agility
Based on their budgeting behavior, many marketers think they are more budget sensitive than they actually are. On average, his 60% of marketers who are “very agile” make budget adjustments monthly or less frequently across digital channels.
This gap between perceived budget agility and actual budgeting behavior exists both up and down the organizational ladder, but is particularly large for executives. A C-level executive is twice as likely to perceive her business as highly budget sensitive as an individual contributor.
Overall, there is room for improvement in adjusting and optimizing the budget on the fly. Teams often lack the ability to make flexible adjustments to allocate spending where the highest ROI opportunities exist. Only 17% of budget-aware marketers and 6% of non-agile marketers have channels with uncapped or unlimited budgets that allow them to easily increase their budgets for new opportunities. And even marketers who are considered budget agile face time-consuming approvals to get budget changes passed. For 59% of budget agile marketers, 20% or more digital budget changes take him over a week to approve.
4 Factors for Budget Agility
The good news is that for organizations struggling with budget agility, drastic changes aren’t necessary to make meaningful progress.
A Google/Kantar study uncovered four behaviors organizations are adopting to improve budget agility.
- Break down organizational silos: 58% of marketers create cross-channel team touchpoints such as meetings, training, and information sharing to improve collaboration. Budget-conscious organizations are also more likely to prioritize cross-channel collaboration and develop integrated marketing teams. Budget-aware marketers are twice as likely to refer to marketing across multiple channels as “very tightly integrated” compared to non-budget agile marketers.
- Embracing cross-channel automation: Budget-aware marketers are 29% more likely than non-budget marketers to use automation to optimize performance across various digital channels in real time and improve ROI.global streaming service Discovery+ has moved away from managing siled campaigns Digital media purchases into one holistic optimization P-MAXis a goal-based campaign that optimizes performance across all Google advertising channels and inventory.
- Implementing consistent measurements: By sharing goals and measurements across marketing channels and teams, you can improve cross-team collaboration that supports budget agility. His 41% of marketers surveyed set shared metrics and her KPIs across channels to improve collaboration.
- Rely on agency partners: Agencies can encourage fluid thinking Budgeting and breaking down silos within the organization. His 42% of budget-agile marketers say their agency has a greater impact on the adjustments his partners make after initial budget planning, compared to 31% of non-agile marketers.
What budget agility means
In this challenging business environment, investing in strategies that deliver ROI is critical. Don’t get caught up in outdated strategies for budget planning. Plan ahead, but be prepared to turn quickly.
Budget agile marketers can reallocate based on what works well, invest in new opportunities, and optimize organizational design to improve business performance. Marketers who don’t have as much budget agility as they need have opportunities to improve with simple actions, such as increasing collaboration across teams or investing in automation to improve budget control and optimization in real time. I have.
By becoming a more agile organization, you can move faster and pivot to capture more performance opportunities and drive business growth.
Source: Google/Kantar Budget Agility and Channel Desiloing Research, US, CA, AU, BR, DE, IN, JP, UK, Advertisers: Agile n=416, Not Agile n=1,677, Desiroed n=514, Siled n= 1,579, March 2022 to June 2022.
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Marie Glynn Maar Vice President of Global Advertising Marketing at Google, responsible for building and executing global marketing strategy for Google’s advertising business and advertising products.