7 essential insights to help you determine your marketing budget for 2025

Different sectors in the business world use a variety of benchmarks to determine marketing budgets. As a result, budgets vary significantly across different industries. 

Finance 
Gartner's CMO Spend and Strategy Survey for 2023 shows that the financial sector, which includes banks and insurers, spent an average of 7-10% of their revenue on marketing. What is striking is that their focus is offline and devoted to more traditional marketing than other sectors. For example, about 60.7% of their marketing budget went to non-digital channels, which is above average. It’s worth bearing in mind that these are averages. Depending on their situation, size and goals, companies deviate significantly from this. 

Technology 
In 2023, the technology sector spent an average of 10.1% of their revenue on marketing, with 65.7% going to digital channels. Startups were advised to invest 11% of their revenue in marketing to stay competitive. The industry led the way in digital spending, and for the first time, more money was invested in buying online media than TV advertising. 

Automotive & mobility 
The mobility sector saw a significant decline in marketing spending in 2023, with an expected decrease of 12.4% compared to 2022. This is in line with a continuing trend that started in 2016, except for a brief post-pandemic rebound in 2021. Car brands share of global ad spending fell from 10.1% in 2013 to an estimated 4.1% in 2023. This marketing budget is well below the average of 9.1% across all industries. 

What about your specific sector? 
Do you want to compare your marketing budget with the standards in your industry? Gartner's CMO Spend and Strategy Survey or Deloitte's CMO survey are reliable sources of information. 

Do you need help determining your marketing budget? iO has expertise in more than 20 sectors. Contact us, we will be happy to help you.    

In 2023, 56% of marketing budgets were devoted to online channels, and 44% to offline channels. This shows that there is a balance between digital and traditional media, rather than a purely 'digital first' approach. The resurgence of offline media is attracting more attention, which emphasises how important it is to use both online and offline channels in a smart marketing mix. 

However, it is expected that the split between online and offline marketing budgets will shift further towards digital channels in the coming years. Factors such as increasing digitisation, growth of e-commerce, and the emergence of new technologies such as AI and big data will ensure that online marketing becomes increasingly important. 

There is still space for offline marketing, especially in industries where physical presence or brand experience plays an important role. The presence of offline media in a specific context, is dependent on the industry, target group and objectives. A well-thought-out balance between online and offline remains crucial for success. 

In 2022, social media and search advertising claimed a prominent place in the budget allocation. Platforms such as TikTok, Meta and Google still offer interesting opportunities for marketers, but at the end of 2023, marketing spend on social media fell significantly. Don't want to miss out on those opportunities? Then it's smart to spread a significant part of your digital budget over both the 'classic' and new social platforms. This will prevent you from becoming dependent on one channel. It is important to find a good balance. 

The 70/20/10 model that we favoured in 2023 holds. It is still a solid guideline to base your digital marketing plans on. This model is beneficial for marketers because it promotes effective budget allocation and resilience in a market that is constantly changing. 

• Spend 70% of your marketing budget on established channels that have already demonstrated that they drive profit for your business or brand.  

• Spend 20% on emerging channels that your target audience is already embracing, even though the ROI may not be difficult to define.  

• Set 10% of your budget aside for new platforms — the so-called 'moonshots' — where your competitors are not yet active.  

Uncertain which established channels are working best for you? No problem: use our data modelling solutions to gain clear insights into your data. We look at the different types of data your company collects and generates, and how that data relates to the other so that you can see where the real opportunities are still up for grabs.  

Demand for in-person and physical experiences rose sharply after the pandemic. Offline channels, events and trade shows provide opportunities for face-to-face interactions with customers and are crucial for brand building and customer loyalty. A mix of online and offline marketing delivers a balanced strategy that covers your entire customer journey. Offline campaigns set you apart from the competition and reach some audiences better – especially with an audience that regard digital brands with scepticism. They also offer tangible experiences that create strong emotional connections with customers. By investing in offline channels as part of an integrated marketing strategy, you can take a more holistic — and highly effective — approach to reach and engage your target audiences.  

In this blog article, we explore why the balance between performance marketing and brand building is crucial. Of course, short-term results such as conversions and sales are still important. Nevertheless, we must not forget to invest in long-term brand value. A good balance ensures both measurable growth and a strengthened emotional connection with the target group. And that's essential for sustainable brand growth.  

If you want to make the most of your marketing budget, continuously monitor which channels and campaigns are generating the most revenue. This will allow you to shift your budgets from channels that are underperforming to channels that deliver tangible results. 

There is a clear trend in budget allocation, and many companies are hoping to address their problems with the help of AI. For example, capacity issues in marketing teams are a continuing issue. In 2022, 58% of CMOs felt their teams lacked the right skills to effectively execute their predefined strategies. 

To make sure that you, as a CMO, don't just spend money, but invest, it's a smart move to allocate some of your marketing budget to: 

• Support from an external agency 

• The right tools and resources for marketing data, analytics, and technology 

In 2023, we saw a sharp increase in demand for data analytics and technology. Many CMOs hope that AI will offer solutions to reverse certain shortcomings in the operation of their company. However, experts agree in the short term, AI may not deliver the expected results. 

AI's 'hope of salvation' goes hand in hand with a focus on greater efficiency. Due to budget constraints, marketers have started to focus more on reducing waste and increasing the effectiveness of their marketing efforts. In 2023, CMOs increasingly heard that they need to do more with less. These budget constraints show that the focus is now on innovation, efficiency, and strategy—in other words, sustainability.

CMOs invested significantly in marketing data and analytics in 2023, with AI as a key driver. This shows a clear trend towards more data-driven marketing. On average, 19.9% of the marketing budget was spent on marketing technology, including data and analytics tools. This percentage was expected to rise to 23.5% within a year. 

One thing is certain: AI was the marketing hype of 2023. More than 64% of marketers actively used AI for marketing purposes, which led to better sales, more satisfied customers, and lower costs. AI helped consumers make smarter choices, contributed to a more personal approach to customers, and streamlined processes. Marketers were able to focus more on the big picture while AI took care of the details. Still, there were bumps: yields were 34% lower than hoped for and the integration of new technology was still a bit difficult. 

But CMOs continued to invest and prepare their companies for a future full of data and tailored marketing. They recognised the true value of data, analytics, and AI to amplify the impact of their marketing and work more efficiently. The advent of AI accelerated this trend and revealed new opportunities for in-depth analysis and automation.

Determining the right marketing budget for 2025 requires a fresh, holistic approach that looks at what has worked in the past, but also keeps a sharp eye on future trends. While the marketing landscape is constantly changing, the golden rule is still: focus on real customer engagement and keep your ROI measurable. Whether you opt for digital strategies, offline connections, or a balanced mix of both, smart budget choices will lay the foundation for your marketing success in 2025 and beyond.