Be effective: Marketing ROI and budget management Despite concerns that marketing budgets could come under pressure from company-wide cost-cutting programs, the participating European CMOs signaled optimism in our survey. A significant 72 percent plan to increase their relative marketing spending in 2025 (compared to 49 percent who actually did so the previous year), while 27 percent intend to keep spending constant (versus 49 percent actually doing so in 2024). This indicates a belief in the potential for growth in Europe. However, this optimism comes with pressure from the board, as CMOs are increasingly challenged to demonstrate the value of marketing spend and operate more efficiently. Notably, five of the ten topics cited as most important by the CMOs surveyed center around proving and enhancing marketing’s contribution to business outcomes. Aligned with their primary objective for 2025—achieving profitable growth—the participating marketing executives focus on driving marketing efficiency gains and re-investing freed-up spend into activities with higher effectiveness. This is enabled by two principles: — Budget management (ranked #2 among the most important topics) is about strategically planning and allocating, as well as monitoring marketing spend. It aligns investments with marketing objectives and helps continuously optimize and adapt them to changing insights and market conditions. — Measuring the financial return from marketing activities, the MROI, ranked sixth among respondents. It helps to create transparency and accountability for the value delivered by marketing activities, enabling a sufficient and optimized spend allocation in the future. Marketing budget management to drive profitable growth The European CMOs surveyed are focused on profitable growth. When asked which main objectives their companies were pursuing with their marketing activities, 60 percent named profit growth among their top three. Yet revenue growth remains a close second and was the most frequently cited number-one goal, while market share growth was third. These three goals were cited significantly more than any others (Exhibit 9). Given the strong focus on profitable growth in a challenging and uncertain external environment, it may seem logical to anticipate cuts in marketing budgets. But while there have been suggestions that may happen—one report found around 54 percent of marketers were either likely or very likely to reduce advertising spending in 2025—there have also been forecasts that absolute advertising spending will maintain the upward momentum of 2024, albeit at a slower pace, or anticipating at least stable budgets relative to sales throughout 2025. Our survey found virtually all participating CMOs were inclined to take a through-cycle investment perspective that balances profit and revenue ambitions. Just 1 percent of respondents expect their marketing budgets to decline relative to sales: 72 percent believe they will grow while 27 percent of CMOs surveyed said they would at least remain stable (Exhibit 10). Still, there are decision-makers in addition to CMOs involved in final budget decisions (especially the CFO and CEO) and we surveyed for budgets in relation to net sales and not total budgets, hence expectations might be slightly optimistic. However, our research indicates that investing in marketing to drive growth during tough economic times can result 26 Past forward: The modern rethinking of marketing’s core