The Marketing Budgets 2011 Report published by Econsultancy in association with SAS, looks at how companies are allocating their online and offline marketing budgets in 2011.

More than 500 companies, mainly from the UK, participated in this research, which took the form of an online survey between December 2010 and January 2011.

The report looks at relative levels of planned spending this year across a range of marketing channels, comparing online and offline budgets while also looking at planned investment on different types of marketing technology.

Generally the results are positive and reflect an improving economic outlook with just over half (52%) of companies increasing their overall marketing budgets for 2011, up from 47% the same time a year ago.

Here are some key observations;

Digital continues to be a focus for increasing marketing budgets

  • Nearly three-quarters (72%) of responding companies say their digital marketing budgets are increasing this year – this figure is up from 68% a year ago
  • Comparatively, a quarter of companies (26%) who say that offline marketing budgets are increasing this year
  • Companies increasing their digital marketing budgets are doing so by an average 35% year-on-year, up from 33% last year

While digital continues to grow, the improved economic environment has improved the fortunes of some offline marketing channels. The effectiveness and measurability of digital is giving companies confidence that offline marketing investment is also paying dividends

  • The proportion of companies increasing TV investment is up by 8% (to 31%), while radio is up by 11% (to 25%)
  • Companies are investing in offline marketing channels to complement increased digital investment, with integrated campaigns which – for example – use television and radio advertisements to drive searches and website traffic
  • This revival of offline helps to explain why companies surveyed are spending, on average, 37% of their total marketing budget on digital, down from 45% last year

There is evidence to suggest that companies are becoming more reliant on digital marketing technology

  • Companies are most likely to be investing in business analytics and web analytics software, with 45% of respondents saying that spending on this will increase in 2011. This focus reflects the on-going need to understand and measure the effectiveness of marketing channels, and how they relate to each other
  • The next most buoyant areas for technology investment are CRM (40%), content management systems (39%) and email platforms (also 39%)

Surprisingly, despite increased investment in web analytics and maturity of some online marketing channels, the perceived ability to understand ROI from digital marketing is actually decreasing

  • Fewer companies than last year say that their understanding of their returns from digital channels is “very good” (20% this year compared to 27% last year), while a higher percentage of companies say their understanding is “poor” (11% compared to 7% in 2010)
  • In contrast with measurement of digital marketing ROI, the percentage of client-side respondents that claim they are good at understanding ROI from traditional marketing channels has significantly increased in the last year, from 31% to 40%

To download the report in full visit econsultancy.com/uk/reports/marketing-budgets.