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Where SaaS CMOs are Spending Their Money

Where SaaS CMOs are Spending Their MoneyAs MarTech continues to change the game, we know CMOs can’t ignore the trends that are revolutionizing how teams market and how consumers interact with brands. Software as a Service (SaaS) is an area particularly ripe for growth in this age of digital explosion and cloud-based-everything, and SaaS marketing trends differ greatly from other industries, especially when it comes to adoption of MarTech. If you really want to see how trends transition to action, pay attention to an old but good rule: follow the money. Let’s examine where SaaS CMOs are spending their budgets.

Mixing it up with Content Marketing

According to data from Bloom, some SaaS companies are prioritizing content marketing—and in different forms. Eleven percent of the world’s biggest SaaS companies have a blog, for example, and the results are pretty even when it comes to the type of content delivered: 24 percent say they post educational content, 20 percent say they post company news, and about 45 percent say they do both. The results appear to be paying off, as these blogs generate an average of 573 organic search visits monthly. (Not surprisingly, the educational content outperforms the promotional.) Blogs aren’t the only thing SaaS CMOs are spending budgets on, either. Bloom also found 18 percent of companies polled, for example, have their own podcast.

Diversifying (and Steadily Increasing) MarTech Spend

According to Gartner’s CMO Spend Survey 2017-2018, overall marketing budgets decreased close to 1 percent—from 12.1 percent of company revenue to 11.3 percent, to be exact, in tallies from 2016-2017. One important caveat: That figure includes data from CMOs across all industries. MarTech spending specifically across all industries also went down during that timeframe, too, from 27 percent to 22 percent.

Is it the same for SaaS CMOs? No. When we look at data specific to SaaS MarTech spend, though, we find that figure is between 30 and 35 percent of annual revenue (and it is as high as 50 percent for sales and marketing combined in top performing SaaS companies).

The reason for the difference is twofold: First, the cloud market itself has been in a perpetual growth phase as more companies look to public cloud offerings to streamline operations, boost productivity, and conserve resources. Second, it just makes sense: SaaS companies make tech their business, meaning an investment in new solutions is a direct investment in the advancement of the organization. Plus, if it’s cost-effective to produce SaaS products, it’s cost-effective to leverage and diversify that investment, making the reason for the spend percentage difference easy to see.

Leveraging Machine Learning and AI

AI is a big piece of the marketing puzzle in 2018, impacting bread and butter activities like website design, SEO, content creation, customer service, and more. (More on that here: Eight Examples of AI In Marketing.) SaaS CMOs are paying attention, investing in machine learning and AI-backed applications like customer service chatbots, robust analytics capabilities, and initiatives that use data to improve the ever-important customer experience.

What’s Next?

MarTech is here to stay, and it’s especially close to the hearts and budgets of SaaS CMOs who live and breathe cloud. I’ll continue to watch these spending habits closely and bring you insights into how they impact the SaaS industry and beyond. In the meantime, what is your MarTech investment of choice for 2018? I’d love to hear your thoughts.

Additional Resources on This Topic

Selecting an SaaS Vendor? Key Considerations for Evaluating Prospects

How CIOs Become Invaluable in the Age of SaaS

The CMO Personality, Demystified

 

 

Eric Vidal
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Eric Vidal

Chief Marketing Officer at The Marketing Scope
Eric is the Chief Marketing Officer of The Marketing Scope and Editor at Converge, both BMG properties. He is also the acting SVP of Marketing at BMG and has ran marketing for companies of all sizes. He has extensive experience working to achieve measurable business results for organizations like IBM, Cisco, WebEx, Canon USA, Capgemini, adidas, Subaru, SAP and more. Connect with Eric on LinkedIn
Eric Vidal
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