Marketing expenditures in the US have increased by only 2.5% over the past year, representing a flat growth rate compared to six months ago, according to the latest edition of The CMO Survey. Furthermore, marketing spending now constitutes a smaller share of company budgets than in recent years.

Chief Marketing Officers (CMOs) estimate that marketing expenses account for 10.2% of overall company budgets, compared to 10.6% in the Fall 2023 survey, 12.3% in the Spring 2023 survey, and a peak of 13.8% in September 2022.

Despite this, CMOs predict that budget growth will accelerate in the coming year, forecasting a 4.7% increase in marketing spending over the next 12 months, nearly double the growth rate of the past year.

So, what would marketing executives do with additional budget funds?

The answers provide insight into current CMO priorities. According to the report, with an additional budget of $1 million, the largest investment would be in hiring and talent development, cited by 16.6% of respondents. This reflects the importance of talent in contributing to company growth and some existing talent gaps within firms. The second most frequently cited area for additional budget investment is digital advertising and marketing. This is interesting, considering CMOs report that their digital marketing expenses have increased much faster over the past year than overall marketing expenditures (8.9% versus 2.5%, respectively). It appears that marketing executives believe their digital marketing efforts are yielding results. Beyond digital marketing and advertising, some CMOs also report that they would invest an additional million in brand building and awareness (7.9%). This is noteworthy, as brand building takes a back seat to customer experience in expected expenditure growth, according to the report. The fourth most frequently mentioned area for additional budget investment is artificial intelligence (AI) and automation (7%).

The findings are based on a survey of 282 marketing executives in profit-oriented US companies, with 94% being C-level executives.