The budget crunch: Why marketing costs are rising across B2B SaaS

B2B SaaS marketing is facing rising customer acquisition costs (CACs) due to macroeconomic factors and shifts in buyer behavior, with advertising becoming more expensive and less efficient as digital competition intensifies. Studies show significant increases in CACs from 2014 to 2019, further exacerbated by the COVID-19 pandemic, with ad costs on platforms like Facebook and Google rising sharply. This is compounded by increased competition and supply-demand imbalances in digital ad inventory, alongside a growing number of companies vying for attention. Privacy regulations such as GDPR and Apple's app tracking transparency have further complicated targeting and personalization efforts, forcing marketers to spend more to achieve previous results. Additionally, changes in buyer research behavior, with a preference for anonymous browsing and peer recommendations on dark social platforms, further challenge traditional marketing strategies. Declining engagement on paid platforms and shifting consumer behavior necessitate a reevaluation of marketing approaches, as old methods are no longer as effective. As a result, marketers need to update their go-to-market playbooks to adapt to this new landscape and counteract rising CACs effectively.