How has US marketing spend performed in H1 2023?
While underlying economic conditions held up more than expected, caution has limited marketing spend. Furthermore, a correction in valuations in the technology sector has driven significant cutbacks in marketing spend. B2B marketing spend is more severely impacted due to a greater exposure to technology, with most segments experiencing a decline or slowdown in growth.
These macro conditions have resulted in a slowdown in marketing spend across categories, with traditional media and B2B having the most significant cutbacks. These factors are reflected in financial results from media companies and agencies.
Overall in H1 2023, US marketing spend underperformed expectations.
What is the marketing spend outlook for H2 2023 in the US?
- Growing optimism has resulted in a more positive growth outlook of the economy, with recent forecasts for US GDP showing slight improvement on January 2023 forecasts (from 1.4% to 1.8%)
- Plural estimates overall US marketing spend to grow by +2% 2022-23, revised down from +5%
Improved macro conditions should lead to stronger H2 performance, albeit below initial forecasts for 2023.
How have marketing budget cuts affected spending across channels?
Cuts in marketing budgets and increased scrutiny of marketing spend have led to an acceleration of the ongoing drive towards higher efficiency.
This increased focus on efficiency further drives the refocus of spend on high ROI activities in the near-term towards activities with shorter payback periods. Budgetary pressures have also led to the cut in channels offering flexibility, including digital channels and the use of external agencies. There is a refocus of marketing spend towards mid-lower funnel activities such as lead generation. Budget holders have also seen delays to investments considered non-essential, including martech.
In US B2C budgets, lower levels of spend in digital paid media, agencies and events in the near-term is driving slower growth.
Download our updated US marketing spend outlook to see details on:
- How a more cautious market environment has resulted in investor pressure and a shift from growth to profit-driven mindsets, driving significant cutbacks in marketing spend
- Company revenue growth by marketing segment
- Revised forecasts of total US marketing spend by company type and marketing segment
- How marketing spend is shifting in the near-term towards activities with high ROI
- Factors influencing trends in marketing spend
- Marketer priorities for the remainder of 2023
This update to our annual marketing spend outlook is based on publicly available data, statements from listed companies and Plural Strategy internal research.