There is a sense of optimism drifting through Canadian marketing. Budgets have blipped upwards, staff numbers are staying intact or growing and even the influence of the marketing department is perceived to be on the rise.

Those are some of the heartening results we found in strategy’s 1st Annual Report on the Canadian Marketing Sector. A total of 415 marketers from across the country responded to our queries about everything from the biggest issues facing the industry (ROI pressure for 36.5% of respondents) to the last time they had a raise (for 75.1% it was a year ago or less). Generally, it seems, you’re all rather rosy.

Alan Middleton, professor of marketing at Toronto’s York University, has noticed it, too. ‘The [Canadian marketing industry] has been optimistic for about six months now. [It’s] tied to the fact that for the last few years sales numbers haven’t been bad…everyone is feeling quite bullish.’

That sentiment has been buoyed by a stable, even encouraging Canadian economy. Recently, the big banks forecasted between 2.5% to 3.2% economic growth for 2005, which Middleton says coincides with the over 70% of marketers in our survey who have noticed increasing or stable marketing budgets. And you’re all spending more. Nielsen Media Research 2004 figures reveal that ad spend was up a staggering 28.5%, January to November 2004, compared to the same period the previous year.

Five-year-old brand Garnier, a division of cosmetics giant L’Oréal Canada, is a shining example of the big-spend-big-results school of thought. ‘There is an increased belief [at L’Oréal] that marketing is driving sales,’ says Scott Moon, director of marketing at Garnier. ‘From that respect the CEO and head of corporate finance are letting us increase marketing spend year after year.’ Case in point: For 2005 Garnier’s marketing and ad spend is up another 30%.

As a result, the brand continues to outpace average growth in all its categories. Its hair colour line for example (which includes Garnier Nutrisse and Garnier 100% Color) is experiencing over 30% growth in a market Moon says is otherwise flat. ‘Really, it’s [because of] increased spending. We’ve [also] been launching more and more products into the market,’ the most recent being the Garnier Skin Naturals in January.

Likewise, Ian McIntosh, Goodyear Canada’s GM of advertising and marketing, says the company is riding high. ‘We fully believe we’re on the upturn,’ he says.

The shift couldn’t come any sooner for the tire manufacturer which has suffered slumped stock prices, stagnant marketing budgets and staff cuts over the past few years. But, thankfully, the times are a-changing. Goodyear’s stock prices, for example, have doubled in the past nine months.

‘Overall morale is terrific internally and on the improvement curve,’ says McIntosh. ‘We’re feeling it most on the dealer level: They’re really starting to get excited again. New product innovation is starting to happen.’

McIntosh says he’s recently started to add to his staff and is gearing up for a summer advertising push of a new line of products developed for Goodyear’s light truck and SUV category using Dupont’s Kevlar, an ingredient used to make bullet-proof vests. The usual mixed bag of TV, print, direct mail and P-O-P are planned, but McIntosh is also looking beyond the conventional.

Many of you are making similar strides and using those additional marketing dollars in increasingly innovative ways. When led with the statement: ‘When it comes to new marketing disciplines, in the last year I’ve spent the most on…’ 61% of you said you had dabbled in brand integration. Another 10.4% answered viral marketing, 5.5% said SMS and 3.1% said advergaming. In the coming year those numbers shift slightly with 56.5% choosing brand integration and 15.2% viral, while the number of marketers choosing SMS stayed relatively constant at 4.8% and those pointing to advergaming slightly decreasing to 1.9%. Blogging rounded out the list with about 1% of marketers in each year.

Peter Francey, president and CEO of Toronto-based branding and design agency Spencer Francey Peters, considers these remarkable statistics. ‘They didn’t exist five years ago,’ he says. ‘I think it’s fascinating that now almost 20% [of marketers are spending on them.]’

Says Goodyear’s McIntosh: ‘We’ve dabbled in the last six or eight months in the e-campaign arena, which we haven’t done in the past,’ he says. ‘We’re starting to look at that sort of stuff because there’s more money in the till.’

Garnier’s Moon, too, is spending more on non-traditional media. He says it accounts for 20% of his marketing budget, up from the 5% to 8% allotted only three years ago, and he sees that number increasing.

‘We’re never going to move completely away from traditional advertising, but it’s no longer enough to only do that. We will definitely be integrating all of our activities with Internet, in-store and event marketing to tie in with our traditional campaign.’

Garnier’s recent partnership with Cirque du Soleil is an example of marketing models to come. During the 2003/4 Cirque run, ‘sampling squads’ took photos of attendees at each show, and as a souvenir of the evening, e-mailed the photos to them in a special Garnier frame. Moon says it was an opportunity to both interact with potential consumers and grow the Garnier database. This was supplemented by print and TV spots as well as an in-store contest to win a trip anywhere in the world Cirque was performing.

The trend is driven by the fact that boosting the value of a brand has become invaluable, says Francey, which has meant more spending and innovation to ensure the brand breaks through the ad clutter (which incidentally, our poll ranked as the second key issue facing the industry at 23.2%.) ‘There’s more of a recognition of the value of a brand,’ he says. ‘It’s not all about acquisitions and efficiencies, the brand can contribute a lot to the value of the companies and therefore deserves more of the spotlight.’

Perhaps that explains why it appears CEOs are becoming more involved. According to the survey, a whopping 74.9% say the CEO is everywhere from ‘too involved’ (6.5%) to ‘somewhat involved’ (34.9%) in marketing. ‘For the past few years there’s been a desire to get the CEO more involved because if he/she says it’s something that’s important to the company then everybody listens,’ says Francey. That finding also coincides with the 52.3% of you who feel that the influence of your marketing department is growing.

Most of you are also relating well with your AOR. Of the respondents, 16.4% say the relationship is ‘excellent,’ 28% say it’s ‘very good’ and 32.3% say it’s ‘good.’ Only 4.3% say the relationship is ‘troubled,’ which makes Rupert Brendon, ICA president and CEO quite happy. ‘That only 4.3% of the sample said their agency relationship was ‘troubled’ is to be applauded,’ he says. ‘I have never seen the source of the data that people in the industry use to claim that the life expectancy of a client/agency relationship today is about 5 to 7 years. This confirms that among competent, professional agencies the nature of the client/agency relationship is the determinant to how long it will last. Relationships trump the work.’

Serge Rancourt, president and COO of Toronto’s five-year-old Publicis, which boasts such big-name clients as Wal-Mart, Kia and CIBC, isn’t as confident. In fact, he says the 16.4% excellent rating could be too high since agencies still haven’t reclaimed their place at the right hand of the marketer.

‘The relationships are excellent, but the level of satisfaction is not there,’ he says frankly. ‘[All agencies had] been cutting down [in previous tougher years] to try to protect profits and basically stopped investing in people and training.’ He says ad agencies have been ‘good at delivering the day-to-day’ but haven’t exceeded [marketers’] expectations. ‘We’ve become the executors in their business,’ he says.

Publicis’ global parent company in Paris is currently doing a survey of some of its biggest clients to find ways to shake off the atrophy of the last few cash-strapped years. One of its initial findings is that clients are requesting more senior-level agency involvement on accounts. ‘[They] would like to see more from the agency in proactive thinking that helps grow their business,’ he says. ‘As agencies we have a lot of work to do to regain our position as partner.’

Despite all the signs of promise and revival, professor Middleton says it’s not all sunshine and roses. ‘Most marketers are not very sophisticated in setting their marketing budgets and tend to set them in some conscious or unconscious ratio with sales. But remember that as soon as there are signs of softness in the economy, the marketing budget is first to go.

‘Even with the new addition to the C-suite of the CMO, there is still very little that the marketing industry has done in general, and especially in Canada, to justify its spending. So what you’re seeing is the classic ‘when the tide rises all ships go up.’ The challenge is to use this period to get the measurements and the accountability in better order so that when the economy and the sales soften, [marketing budgets] don’t automatically get cut again.’