The Benefits of Front-Loading Marketing Spend in 2025 for Savvy Marketers

I’ve come across numerous projections about what marketers can expect, anticipate, or strive for in 2025. The rise of AI, potential advancements in other technologies, the utilization of CDPs, and the debate on whether marketers are effectively utilizing CDPs are some of the recurring themes. While some aspects may be novel, many have been foreseen for years.

As I mentioned in a previous post on MarTech, I don’t specialize in making predictions. I don’t follow the “New year, new you” trend. At 53, there’s no new version of me, just updated editions.

Instead of forecasting the future, I prefer to analyze the current state of our industry and suggest strategies for marketers to leverage opportunities or mitigate challenges. This article will focus on the latter.

From cutbacks to investment

In my previous post, I emphasized the importance of marketers having contingency plans to navigate potential downturns. These downturns could stem from national issues, internal organizational changes, or unforeseen obstacles. Such challenges could jeopardize annual objectives or targets and are often discussed at the executive level within your company.

Here are some common questions that arise in discussions with C-level executives. Let’s refer to it as my Top 10 list for January 2025.*

1. What defines our success, and how do we address underperforming channels?
2. With the new Congress, is there a path towards a national privacy approach in the U.S.? If we adopt GDPR, how will it impact our company practices?
3. How will tariffs impact our company, and what will be the consumer response? How should we communicate this?
4. How might tariffs influence our supply chain? Should we explore sourcing from non-tariff countries?
5. How will Meta’s decision to discontinue fact-checking affect the platform’s effectiveness and our advertising spend? What should our next step be?
6. If the Department of Justice relaxes certain government regulations, how will this impact us?
7. Are we appropriately embracing AI, and is our martech stack strategy aligned with our goals?
8. What message should we convey to consumers, particularly in a politically divided era, who seek to understand our values?
9. Should we increase investments in physical retail experiences with products or continue focusing on online investments?
10. We switched vendors post-COVID. Have we seen the innovation we anticipated? Do we need to renegotiate those contracts or initiate a new RFP process?

*While my list is geared towards U.S. marketers, many of these issues will impact marketers in countries with significant ties to American markets.

Similar questions were raised in 2024, prompting companies to pause or reduce their expenditures. This uncertainty led to a defensive approach, with companies fortifying their positions rather than venturing into new territories. While this year’s questions differ, could history repeat itself in 2025 with another pullback in investments?

I believe not, at least not immediately. There’s a glimmer of optimism stemming from pent-up demand following last year’s stagnation, which is gradually revitalizing the market for 2025.

However, this doesn’t mean marketers can afford to be complacent. Instead, they should strive to utilize as much of their budgets as possible in the first half of the year. Any funds allocated for new initiatives, technology upgrades, acquisitions, events, or conferences—move them up to the first half of 2025, if feasible.

While the uptick in spending may be a result of companies catching up after a year of restraint, it’s not a sustainable model, especially if competitors escalate their investments.

The need to remain competitive is likely to drive further investment in transformation, but that’s just the beginning of the story.

Dig deeper: 10 martech predictions of what won’t happen in 2025

From investment to cutbacks?

This year, we anticipate a substantial investment in change, which is positive news. However, how long will this investment persist? The six-month timeline I discussed earlier offers a glimpse into the next 12 months.

Let’s examine three factors that are likely to influence company expenditures this year and why front-loading investments in the first half is crucial. Uncertainty in the latter half of the year could prompt companies to halt or reduce their budgets.

1. Market instability

Markets abhor instability, whether it stems from inflation, interest rates, stock market volatility, reduced consumer spending, or unresolved queries. This uncertainty breeds caution among companies, leading them to economize wherever possible.

My list only scratches the surface of the discussions among executives as they attempt to forecast trends while planning product launches, expansions, and objectives for the next 18 to 24 months.

C-level executives will monitor market instability closely to inform their decisions, including budgetary allocations.

Consider a finding from a recent study by Statista:

“During a September 2024 survey among chief marketing officers (CMOs) from for-profit companies in the United States, respondents reported that, on average, 7.7 percent of their employers’ revenues were allocated to marketing activities. That was the lowest average share for an autumn survey edition since August 2018.”

This decline poses challenges for companies seeking to leverage advanced technology to gain a competitive edge and rise above the noise generated by rivals.

As an informed marketer, it’s essential to monitor the same indicators that your executives are following. Stay abreast of statistics to anticipate market shifts and adjust your spending priorities accordingly to preempt potential cutbacks.

2. Political change

National elections or governmental transitions introduce uncertainty. This observation isn’t a commentary on the outcomes of recent U.S. elections but a recognition of the shifts that occur. New administrations bring fresh policies and priorities, creating an environment of uncertainty as individuals await the long-term impacts of these changes.

Executives are keenly observing how political developments will reverberate globally and locally, extending beyond the financial markets. As they craft business strategies and forecasts for the upcoming year and beyond, C-level executives are cognizant of the implications of political transformations.

Amidst their focus on sales and profitability, executives also bear the responsibility of safeguarding their organizations and employees. Political volatility introduces an unpredictable element that can influence market stability, necessitating strategic adjustments to shield their companies.

Political upheaval also influences consumer spending patterns, as explored below.

3. Consumer security

Consumer spending is intricately linked to consumer security, as individuals tend to curtail their expenditures when financial concerns loom large.

In the U.S., discretionary spending saw an uptick in 2024. Although consumer discretionary spending intentions improved for the fifth consecutive month in December 2024, they remained subdued compared to 2021 levels, as indicated by a Deloitte study. Both high- and low-income earners reported enhanced financial positions, with lower earners experiencing stagnant growth.

While overall consumer spending exhibited an upward trajectory, this trend impacted every sector. Executives often evaluate how market or political volatility influences consumer confidence and spending habits.

Earlier this year, MarTech highlighted a study demonstrating how political affiliations influenced consumer behavior:

“Half of Independents align their purchases and media consumption with their political leanings—whatever they may be—and 58% prefer purchasing from organizations that support causes aligned with their beliefs. This group also displays a preference for larger corporations over small, local businesses.”

These insights underscore the urgency of refining your email segmentation strategy. In addition to delivering the right message to the right audience, segmenting your lists effectively can aid in forecasting spending patterns. Consider the following:

• Are you segmenting your lists to identify loyal customers?
• Are you discerning macro and micro spending trends through segmentation?
• Are you proactive in gauging fluctuations in your program’s spending?

These considerations are pivotal for marketers, empowering them to anticipate shifts that may impact their company’s goals and marketing initiatives in the short and long term.

Consumer spending serves as a barometer for the broader economy and consumer confidence across industries. However, it’s imperative to focus on your specific sector, target audience, clients, and company.

An effective segmentation plan and robust reporting mechanisms are indispensable for marketers, enabling them to gauge how external factors may influence their objectives and marketing endeavors.

Dig deeper: Stop defending your marketing budget — start proving its value

Wrapping up: Use it before you lose it

Revisiting the six-month strategy I outlined, we have a window of approximately six months before the potential repercussions of market, political, and consumer spending uncertainties materialize.

Presently, the market exhibits a degree of stability. The U.S. economic recovery post-COVID is a global standout, with prices gradually normalizing. However, executives are contemplating the future trajectory and preparing for any eventualities over the next 12+ months.

As mentioned earlier, I foresee a surge in investments during the initial six months as companies aim to exhaust their budgets before directives for spending pauses or reductions are issued, particularly for ancillary functions like travel, new initiatives, and recruitment. For marketers, it’s imperative to expedite investments that were deferred last year or perpetuate ongoing initiatives.

While the immediate future may appear promising, it’s crucial to remember the spending gap that emerged in the corporate landscape last year. Sustained reductions in spending for two consecutive years pose challenges for any organization. If your budget was curtailed last year, channel the funds now to realign with your objectives.

This isn’t a free-for-all; demonstrating value and return on investment remains paramount. By safeguarding your email program from further setbacks, you fulfill your role as the email team leader. Let’s embark on this journey together!