Survey: 34% expect marketing budgets to increase in 2025
December 5, 2024
Optimism around business in 2025 appears to be higher, with two out of three (65 per cent) of marketers expecting improved trading conditions, though marketing budget expectations aren’t quite as positive, according to The Voice of the Marketer 2025, a report by WARC released based on a survey of more than 1,000 marketers worldwide.
Global advertising investment is on track to surpass $1 trillion for the first time this year, and is set to grow +7.6 per cent in 2025 per the latest advertising spend forecasts by WARC Media. The research suggests that digital channels will continue to be prioritised over traditional media.
When exploring marketing measurement tools across the industry, the majority (93 per cent) of marketers use at least one technique to measure their marketing investments, with the use of experiments doubling over the past year.
Isabel Cleaver, Senior Analyst, WARC, commented: “The Voice of the Marketer report explores broader marketer thinking on budgets, media channels, measurement and investment plans. We hope readers find the insights outlined in this report useful as they begin to finalise their marketing plans for the year ahead.”
Key findings from the report:
- Two out of three marketers expect business to improve next year while a third expect marketing budgets to increase
Marketers are largely optimistic about the business environment for 2025. Two out of three (65 per cent) marketers expect business to improve next year, the highest in three years.
However, escalating geopolitical conflicts and the implementation of trade policies threaten progress. Nearly three-quarters (72 per cent) of marketers think economic conditions will significantly impact their marketing strategy in 2025.
Consequently, marketers appear less optimistic about increasing marketing budgets for the year ahead: just a third (34 per cent) expect marketing budgets to increase (compared to 41 per cent last year). However, more marketers seem to expect budget increases from last year to be maintained (44 per cent compared to 39 per centlast year), with those expecting lower budgets largely steady at 22 per cent (compared to 20 per cent last year).
Optimism on budgets is markedly lower among agencies: just over a quarter (28 per cent) of agency survey respondents expect budgets to increase compared to nearly half (46 per cent) of brands.
Some marketers will continue to prioritise long-term growth: one-third of marketers (35 per cent) expect investment in brand marketing to increase in 2025, and one-third (38 per cent) expect investments in performance to increase in 2025.
The impact of the environment and diversity, inclusion, and social justice on marketing strategies has decreased in recent years. Only 28 per cent of survey respondents expect the environment and 20 per cent expect DEI to significantly impact marketing strategies next year, versus 38 per cent and 30 per cent respectively last year.
- Online video and social to drive future investments
Almost half of marketers (44 per cent) highlighted media and audience fragmentation as one of the biggest causes for concern in 2025, an increase of 9pp from last year. Along with the challenges, there are more opportunities to experiment in reaching and engaging consumers.
For the second year in a row, most marketers expect investments in online video and social media to increase. According to WARC’s recent Global Ad Spend Outlook, online advertising now accounts for over half (58.7 per cent) of total advertising spend, while legacy media accounts for a quarter (25.3 per cent).
On average, 34 per cent of surveyed marketers do not currently invest in TV and cinema, compared to only 5 per cent for online video and social media. However, recent research – from Ebiquity and Lumen, as well as Thinkbox – has shown that legacy media outperforms digital channels in attention and effectiveness.
David Sandstrom, Chief Marketing Officer, Klarna, said: “I do think traditional media, versus the very hardcore performance media, still has an ability to create trust and tell a story. One thing that brands are lacking today is not their ability to optimise their Facebook ads, it is their ability to tell a story.”
- The adoption of experiments has doubled in the past year
Most marketers (93 per cent) employ one or more measurement techniques, but the techniques vary. While more than two-thirds (67 per cent) of marketers conduct brand health tracking, less than half (45 per cent) use econometrics and marketing mixed modelling (MMM).
Significantly, the percentage of marketers using experiments has doubled in the past year (18 per cent in 2023 to 36 per cent in 2024).
Controlled experiments are often regarded as the gold standard of marketing measurement, as they give the most rigorous evaluation of the incremental value brought on by the marketing investment and calibrate marketing mixed models (MMM), helping marketers generate more accurate and reliable insights for decision making.
Almost two-thirds of marketers (57 per cent) perceive brand metrics as the most impactful measure of marketing effectiveness, followed by ROI, with over half of marketers (54 per cent) indicating it has the greatest impact on strategy. Metrics such as revenue and profit are seen as less.