Digital training is more important than ever before because more jobs are being automated. Now, more than ever, companies need employees who can do the things automation can’t, like design new, innovative products or create complex marketing strategies.
Let’s take some time to go through the data on corporate training, its measurable ROI and its effect on employee retention and satisfaction.
We’ll start by taking a look at how much time and resources are being spent on training in 2016 and analyze the impact of these types of investments.
In 2016, training expenditures totaled $71 billion in the United States. This fast growth in training investment stems from a number of factors, including the continued global economic recovery.
But the skills gap is also cited as a primary reason companies are investing more money and time into their hires. For instance, in the digital marketing industry, a study by The Boston Consulting Group and Google showed the average “skills level” of digital marketing departments is a 57 out of 100.
It’s no wonder marketing departments around the country (and the world) are pouring resources into training digital skills like web analytics, content marketing, digital advertising and much more. As marketers, we all know that we don’t know enough.
Training Cost Per Employee
According to ATD’s 2015 State of the Industry report organizations spend an estimated $1,252 per employee on direct learning expenditures. This includes the purchase of products and services.
Granted, among different industries the numbers obviously vary. According to the Association of Talent Development, industries that typically spend the most on training are:
- Healthcare and pharmaceutical
- Finance, insurance and real estate
As technology continues to improve and automation penetrates departments, it’s expected that other industries will see an increased investment in training as well. Digital marketing is just one of the many fields that’s constantly changing. To stay competitive, marketers need to keep learning new skills like content marketing, SEO, mobile and social media marketing.
Types of Training
On average, companies spend 35 percent of their training budget on leadership development. Nearly nine out of 10 companies view better leadership as very important — second only to organizational structure.
But leadership transitions are historically difficult for companies large and small.
Chris Ross, a research director that covers marketing management and leadership at Gartner, has also emphasized the need for digital marketing departments to train workers in multi-channel marketing, technology and collaboration, as well as foster business skills and leadership capability.
Impact of Training
On paper, spending money on training (rather than just giving employees free resources to peruse) seems like a high-cost expense with difficult-to-measure ROI. But when it comes down to it, high-performing companies always spend more on training.
This is because companies that train their employees see increased productivity and also ensure their workforce stays on top of the latest technologies.
Training is a crucial first step to staying competitive (and not losing out to disruption and automation). Just as an example, The Cheesecake Factory spends $2,000 on training per employee per year, which is much higher than the national average. But the restaurant chain enjoys sales of $1,000 per square foot — double the national average.
Effective training doesn’t just benefit employers, either — it also keeps employees happy and greatly improves retention. A whopping 68 percent of workers feel training and development is the most important workplace policy. It’s what gives employees a sense of value and aligns the company’s goals with their own career paths.
In a study of Sun Microsystems training programs, employees who participated in a mentorship training program were 23 percent more likely to stay with the company than those who didn’t.
Results from general studies are even more noticeable. The American Society of Training and Development (ASTD) has studied over 2,500 companies and their training policies. Those with comprehensive training programs enjoy higher profit margins (24 percent higher than the average) and more revenue per employee (218 percent more).
Training = Sustainable Success
For marketers in the 21st century, digital marketing training is absolutely essential to survival. Most marketers know this, but still aren’t willing to pull the trigger on the training they and their employees so desperately need.
If you’re on the fence about whether you should spend more of your budget on training classes and resources, it’s a no-brainer. Spending on training is always a good investment.
Digital classes offer employees the ability to access training anywhere, anytime on laptops, tablets and mobile devices.
The best part? These classes pay for themselves by cutting down the time you have to spend training, coaching and reviewing each hire’s work in a 1-to-1 setting.
And most classes are quickly updated every year (and sometimes every quarter) with the most current trends and data so that you never have to bring in a costly consultant.
So not only do training resources show your hires that you care about their success, they also free you up to get back to doing business so that you can focus on scaling and increasing your bottom line. And that’s time well spent.