2027 Marketing Budgets Need New Categories, Not Bigger AI Line Items
About a year ago, I made a recommendation that chief marketing officers should “hire an economist or a chief economist” to address the pressing challenges of changing consumer behavior, rapid technological advances, and economic uncertainty.
Earlier this month, nearly 200 economists and technology leaders signed a letter to policymakers warning that AI “could bring risks, including mass displacement.” Basically, the letter called for policymakers to do more to understand and respond to potential disruptions from artificial intelligence.
Very few CMOs employ an economist or chief economist. And I doubt policymakers will move as fast as artificial intelligence, which is transforming the economy faster than any previous technology. So, as most managers, directors, and executives plan their marketing budgets for 2027 sometime after Labor Day, they might want to remember what poet June Jordan wrote in 1978, “It’s what we’ve been waiting for.” What should they do?
They should start by using an audience research tool to find out who their customers are, what they do, and why they do it.
Then, they should submit a request like this:
“Based on real reporting, research, data analysis, or evaluation from authoritative and reliable sources with knowledge and experience of the industry, should I consider changing my budget to completely new categories? Yes, I know that this may cause a terrible review of the reorg or the agency. But now is the time to analyze what is working and what is not without fear or awakening?
Next, they should enter this notice into Google to compare what AI Overview and AI mode recommend. They should also enter this same information on ChatGPT, Claude, and Gemini to check what all three recommend. In addition, they must check the truth, confirm the truth, and look to accept any recommendations that search and artificial AI tools make.
Finally, they should adopt David Ogilvy’s old-school practice of “a long walk, or a hot bath, or half a pint of claret,” which he recommends in his classic book, Ogilvy on Advertising.
I did most of this last week, though I reviewed Ogilvy’s suggestions. Instead, I came up with critical data, market trends, strategic insights, and tactical advice.
The legacy channel buckets in most 2026 budget templates measure a version of the disappearing customer journey. Ewan McIntyre, the Gartner analyst who runs the firm’s CMO Spend Survey, put the numbers on how fast. CMOs now dedicate 15.3% of marketing budgets to AI initiatives, yet only 30% say their organizations are actually ready to scale that investment. At the same time, awareness and conversion now demand 62.6% of total media spending, a jump of more than 10% from 2024, while spending on loyalty and retention has dropped by 29% to less than 15% of the total. McIntyre’s data found exceptions to that shift. Most AI-mature organizations are clinging more to reliability and savings than chasing adoption, suggesting that immature organizations are over-targeting any AI that can easily scale and automate. That is not a contradiction. Reallocations are underway, and many budget templates have yet to reach it.
Christine Moorman, who directs the CMO Survey out of Duke’s Fuqua School of Business, found something pointing in the same direction from a completely different source. The 35th edition of his survey, conducted in January among 308 marketing leaders, found that generative engine optimization (GEO) is already being used in four out of 10 companies, a category that was absent from his research until recently. At the same time, he did not find a marketing technology job that scored more than 5 on a 7-point performance scale. That gap is where a restructured budget for work, not a legacy channel, gains its keep.
So instead of asking which channel gets the most money, I think CMOs should build their 2027 budgets around five performance categories.
AI visibility and quote management. This replaces a chunk of the SEO line, but not all of it. The task is no longer just to measure the page. It earns inclusion in the answer itself, tracked by something closer to what I’ve been calling Citation Share of Voice rather than keyword rank.
Trust the confirmation. I wrote in mid-July that only 28% of Americans trust AI search results. That gap is a budget line now, not a footnote. Brands that sponsor the work to get their facts, guarantees, and reviews built so that an AI model can validate them are the ones closing that trust gap before a competitor does.
Distribution engineering. This is where the DIRHAM 2.0 framework I taught in Dubai this spring comes into its own. Once the content is created and transferred to managed, earned, and crawled sites with AI at the same time, instead of funded channel by channel, it is a budget decision similar to production.
Human judgment and planning oversight. Gartner’s data indirectly contradicts this linear phenomenon. Labor rose from 21.9% of marketing budgets to 24.5% this year, as 43% of CMOs told Gartner they expect to reduce labor costs. CMOs who win that internal debate are the ones who can show what a professional planner or strategic thinker can do with a model.
Estimating reconstruction. The last click attribute cannot identify a customer who asked ChatGPT for a recommendation and never clicked anything. On 20 May 2026, AMEC (International Association for Measurement and Evaluation of Communications) launched its GEO Principles. This and the original Share of Citation of Voice metric are a very reliable place to put your rating dollars for next year.
None of this means that SEO, paid media, content marketing, social media marketing, or digital marketing are going away. It means that your budget organization chart stops showing the outdated PESO (paid, earned, shared, and managed) media model, which did the real work to filter budgets and assign campaigns to channels. But that framework was addressing the question of distribution, not the one that retailers face now. Knowing where you put content doesn’t tell you whether it’s viewable, and viewability today is determined by algorithms, not people scrolling through feeds.
Reorg Your Budget for 2027: 3 Steps Before Moving
Step 1. Re-mark the money spent last year against the five jobs, not the old channels. Pull 12 months of budget data and organize every dollar into AI visibility, trust verification, distribution engineering, human supervision, or measurement reconstruction instead of SEO, paid social, email, and display. This alone often comes from work you’ve already funded that doesn’t have a name on your budget template yet.
Step 2. Use your audience data against each activity, not each channel. Use SparkToro or GWI to check where your customers are currently spending their attention. Bring in work where the gap between spending and attention is too wide first, not the loudest channel in a planning meeting.
Step 3. Join the CFO conversation with one number that is not the last click. Bring your share of Citation of Voice, or similar GEO metric, as proof of reorg. A CFO who hears “AI is changing things” will push back. A CFO who sees a quote trend line next to last year’s organic traffic will ask what’s next.
I will conclude this column by saying that Gartner’s news segment will not. A CMO delivering a 2027 budget planned on outdated channels, in an environment where AI is already shifting attention faster than any technology I’ve used in 20 years, is unintelligent. They are not prepared.
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