Gartner has some bracing — but perhaps unsurprising — news for marketers: We’re in what it calls the “era of less.”

That declaration was prompted by the global tech research/consulting firm’s just-released 2024 CMO Spend Survey, conducted in February and March, which reveals that average marketing budgets have dropped to just 7.7% of overall company revenue — down from 9.1% in 2023. The survey respondents were 395 CMOs and marketing leaders in North America and Northern and Western Europe across company types and sizes, with an emphasis on giants (“the vast majority of respondents,” per Gartner, report “median annual revenue of over $5.3 billion”).

A few key findings from the Gartner survey:

The 2024 marketing spend figure marks a post-pandemic low

In 2019, average marketing budgets amounted to 10.5% of total revenue, and that number crept up to 11.0% in early 2020 — but then COVID-19 hit, sending the percentage plummeting to 6.4% in 2021. The rebound seen in 2022 — when the percentage was 9.5% — has been sinking since, dropping to 9.1% in 2023 and now 7.7%. Ewan McIntyre, VP Analyst and the Chief of Research for the Gartner Marketing Practice, calls the average since 2020 “anemic,” adding that “CMOs are living in an ‘era of less.’”

“This definitely jibes with what we’ve been seeing in the marketplace,” says Quad CMO Josh Golden. As a marketing experience (MX) company that works with more than 2,700 brands across every conceivable vertical — from retail and CPG to health and financial services — Quad keeps close watch on how marketing budgets are being deployed. “Across sectors, some have been spending more while others have cut back,” says Golden, “but on average what we’re hearing from marketers is that their boards are asking them to do more with less.”

“The new normal is that we just simply have less funding in marketing now,” McIntyre told The Wall Street Journal’s Megan Graham.

Marketers don’t feel like they have the resources they need

“Sixty-four percent of CMOs say they lack the budget to execute their 2024 strategy,” says McIntyre, with many of them hoping that deploying AI can “save the day.” (See also: “First, ‘protect your brand’: Gartner speaks with Josh Golden about Quad’s marketing use of generative AI.”)

That feeling of being under-resourced is also being reflected in the marketplace. For instance, one of the most jarring data points in “Eliminating Complexity for a Frictionless Marketing Experience,” a new research report from Harvard Business Review Analytic Services sponsored by Quad: Just 30% of marketers rate their organization’s marketing as “very effective” today, per a new survey conducted for the report. (Read more about the findings here: “How complexity is hurting marketing — and how to deal with it.”)

Marketers are cutting back on martech, staff and agencies

In what Gartner calls a “radical reprioritization of the resource mix,” marketers have been cutting back spending on marketing technology, staff and agencies, while increasing investment in paid media. McIntyre says the martech drop “doesn’t signal a dulled appetite for technology,” but rather reflects CMOs’ diminishing influence over martech as other enterprise leaders, such as IT, take more control.”

As for the high hopes for AI, MarTech’s Constantine von Hoffman writes in her coverage of the Gartner survey that it seems “counter-intuitive” that “the declining martech budget” can properly fund AI-powered marketing solutions, regardless of whether IT or the marketing department controls deployment in any given organization. And, as The Wall Street Journal’s Graham notes, “For marketers facing lower budgets this year, AI won’t fill in the blanks quite yet” — given that marketing departments are still in test-and-learn mode with AI solutions.

“If there’s a silver lining to the ‘era of less,’” says Quad’s Golden, “it’s that marketers have been figuring out how to waste less on inefficient and ineffective marketing. That was one of the key takeaways from the HBR Analytic Services report — that having an overly complicated marketing machine, with a lot of external partners, really hurts marketing performance and impact. Whereas when marketers streamline smartly, campaign performance and impact actually rise, which is pretty awesome news.”

In other words, being forced to cut back on marketing spend can be a clarifying moment for brands.

Across creative, production and media, fueled by intelligence and tech, Quad’s MX solutions suite of solutions is designed to streamline the complexities of marketing, reveal cost efficiencies, improve speed to market, strengthen marketing effectiveness and deliver sustainable business value. Learn more here.