Where Will CEOs Increase Spending Over the Next Year? - eMarketer
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Where Will CEOs Increase Spending Over the Next Year?

CEOs expect the pressure of increased wages to affect business growth

More than a quarter of US CEOs said they plan to increase spending on advertising over the next 12 months, according to research. Marketing and sales promotion is another area they’re focusing on.

Areas Where US CEOs* Plan to Increase Spending, Q2 2014-Q4 2015 (% of respondents)

PricewaterhouseCoopers (PwC) looked at the areas where US CEOs, and their designates, plan to increase spending over the next year. Advertising was a key focus. For example, in Q2 2014, 11% of US CEOs said they planned to increase spending on advertising. Fast-forward to Q4 2015, and 28% of respondents said they planned to increase spending in that area.

Marketing and sales promotion was another focus. In Q2 2014, 15% of US CEOs said they planned to increase spending on marketing and sales promotions and that increased to 23% in Q4 2015.

There are some areas where respondents are not increasing as much spending on. For example, research and development has seen a decline in respondents who plan to increase spending, from 15% in Q4 2014 to 11% in Q4 2015.

Expected Barriers to Business Growth According to US CEOs*, Q2 2014-Q4 2015 (% of respondents)

Likewise, information technology is slightly down over the same period of time, from 31% to 27%. On the other hand, however, geographic expansion is modestly up, from 22% in Q4 2014 to 26% in Q4 2015. These figures indicate that there may be a shift to spending more on client-facing areas, away from internal increased spending.

US CEOs do expect some barriers to business growth over the next 12 months. While one-third of those surveyed in Q4 2015 expect the pressure of increased wages to affect business growth, only 18% expected the same to be true in Q4 2014. Perhaps related, concerns about the strength of the US dollar has jumped from 8% to 24% in the same period of time. Profitability and increasing margins are also a growing concern.

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