Abstract
The 2009 calendar year has brought with it a new world economy. How are managers and executives in scientific industries adjusting the funding of their marketing and communications programs? We conducted an online survey of over 100 industry marketing personnel between September and November of 2008, when the majority of the industry was planning marketing programs and media for the upcoming year. The survey quantifies the distribution of budgets across different channels within the marketing mix, as well as managers’ intentions for allocating budgets in the coming year. The findings suggest several trends and opportunities for marketers, which we discuss in this issue of Linus Report.
Introduction
As the last calendar quarter of 2008 progressed, it was evident to most companies in the scientific industries that the world economic recession was going to impact this industry as well. Many companies reported a slowing of sales and cancellation of orders for capital equipment, and as a result, softened their outlook for 2009. At the same time, marketing management was in the midst of planning their activities for the coming year.
However, with many companies cutting back their marketing budgets, others saw enormous opportunity to outflank their underspending competitors, and optimize their own marketing mix. To better understand how marketing managers were planning their marketing programs and allocating budgets, we fielded an online survey during the months of September, October, and November of 2008. Our goal was to collect data around different marketing tactics to see where marketers were putting their dollars in the face of a changing media landscape and a steep economic decline.
In this issue of Linus Report, we present several key findings based on how our respondents claim to manage their marketing programs and allocate budgets. We report on the 2008 and 2009 budget allocations per channel, the most top-of-mind goals that marketers are trying to reach, and the perceived effectiveness of each channel at helping marketers reach their goals. We end the report by providing a quick diagnostic test that marketers can employ to optimize their own budget allocation within the marketing mix.
Survey Methodology
As an initial exploration of the topic, we first conducted in-depth interviews with four marketers from a variety of companies that sell scientific products and services. While we do not report the results of these interviews, they helped form our hypotheses, which we measured quantitatively through an online survey.
Next, we designed and published our online survey instrument using the QuestionPro platform. To solicit respondents, we sent invitations to a total of 714 marketers via three separate email blasts (Figure 1). We offered no personal or monetary incentives in exchange for responses. Instead, we offered to send a copy of the complete data set, in aggregate, to each respondent.
| DATE SENT | NUMBER OF RECIPIENTS |
|---|---|
| September 24, 2008 | 100 |
| September 25, 2008 | 100 |
| November 6, 2008 | 514 |
Figure 1: Two pilot email blasts were sent in September 2008, followed by a main blast sent in early November, 2008.
Of the 714 marketers who received our invitation, 291 clicked on the survey link, representing a 40.75% click-through-rate, and 114 completed the survey, a 15.96% completion rate. These response rates are several folds higher than the typical response rates of marketing programs.
The online survey consisted of 30 questions, divided into three sections. The sections were: Profile, Marketing Communications Activities, and their Personal Information. Branch logic guided respondents to answer only the sections that pertained to them. In all, each respondent spent an average of 16 minutes with the survey.
All data were imported into SPSS, a commercial data analysis software package for analysis and initial visualization (www.spss.com).
Subsequent data visualization was done in Microsoft Excel.
In this report, we use present company revenues and marketing budgets in total dollar amounts to profile our respondents. In order to normalize the data, however, we analyze and report all subsequent budgetary data in relative percentages instead of absolute dollars.
Profiles of Respondents
All of the survey respondents work in scientific companies that range in annual revenue size from less than $1M to over $1B. Figure 2 illustrates this distribution.
Figure 2: A graph of the distribution of company sizes shows our respondents represent companies with a wide range in size (n = 158). More than half (61%) of the companies have revenues of less than $100M.
Every survey respondent is involved in some aspect of senior management, marketing, marketing communications, or sales and focuses on selling products and services to a variety of industries from basic research, healthcare (pharmaceutical, biotechnology, diagnostics, hospitals), manufacturing (chemical, petrochemicals, food, energy), and testing (environmental, forensics, agriculture, defense).
As expected with a sample set representing a wide range of company sizes, annual marketing budgets from our respondents ranged from less than $100,000 to over $10,000,000. The full distribution of budgets can be seen in Figure 3.
Figure 3: The diversity in annual marketing budgets is to be expected based on the wide range of company sizes that are represented in our sample (n = 158).
