Did you know what global IT players are spending on marketing? Have you always looked for statistics and data to support your views in your organization? – Through this new section, we aim to bring to you some important statistics and metrics.
Overall indicators
- A recent survey by B2B Magazine shows that 29% of marketers are reducing their marketing spend, the biggest cuts are not surprisingly in print (-45%). At the same time, 12% of marketers are increasing their budgets and online marketing is the largest area of increase 48%
- IT vendors spend an average of 3.6% of revenue on marketing. Software vendors spend the most (6.5%), hardware makers (3.7%), and IT service firms spend only 1.1%
- IT vendors spend 63.5% of their marketing budget on programs and 37.5% on headcount
- IT vendors spend the biggest portion of their budget on advertising (23.2%). Other significant budget items are events (19.3% of the marketing budget); sales tools such as case studies, whitepapers, and interactive on-line tools (16.8%); direct marketing (12.9%); PR (6.5%) and AR (2.3%); and collateral (5.1%)
- IDC found that at tech companies with less than $500 million in annual revenue, 59% of the total marketing budget is spent on corporate marketing; 32% is spent on regional marketing; and 9% is spent on business unit marketing
- At tech companies with more than $3 billion in annual revenue, 43% of the marketing budget is spent on corporate marketing; 36% is spent on regional marketing; and 21% is spent on business unit marketing
- IT hardware, software, and services vendors, including Adobe, Cisco, HP, IBM, Intel, SAP, Symantec, and Xerox represent over $400 billion in IT revenues and over $15 billion in marketing spending
Looking at the big league
- Cisco, with measured media spending of $79 million, is outgunned by the marketing budgets of larger competitors like IBM and Hewlett-Packard, which spent $123 million and $248 million respectively last year
- Global IT major IBM, whose revenues are in the region of $50 billion plus, spends around 22% of its revenue on SG&A (Sales, General and Administration) expenses
- Google is on track to spend nearly $2 billion this year on sales and marketing , yet its offline advertising budget is estimated to be only $20 million a year
- Indian companies like Infosys, TCS, and Wipro spend in the range of 10% to 18% of their revenues, though Cognizant has consistently invested higher at around 23%
- Cognizant, by spending 8-9% more on marketing compared to Infosys and Wipro, managed to add 182 clients in the last three quarters, while TCS had 138, Infosys 129, Wipro 107 and Satyam added only 99 clients
- Sales and marketing expense alone is in the range of 4% to 6% for IT majors Infosys and Wipro and there has been a marginal change in marketing expenses on a year-on-year basis
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In the case of TCS, this expense has consistently declined over the last three fiscal years; TCS embarked on a cost cutting program that saw SG&A down to 19.9% of revenue compared to 22.16% in March 2008
- Infosys spent $16 million last year on its brand building exercise to focus on earning the respect of all its stakeholders
- Wipro launched its “Applied Innovation Campaign” in January 2008 which saw increased spending on marketing and branding - (70%) - over the past year