Forrester’s Non-Program Spend Categories: What They Are and Why They Matter

The Forrester marketing budget framework divides total marketing spend into two broad categories: program spend (the money that goes directly into campaigns and media) and non-program spend (everything else that makes the marketing function run). Non-program spend covers people, technology, agencies, data, and infrastructure. Most marketing leaders underestimate how large this category is and how much strategic leverage sits inside it.

Understanding where non-program spend sits in your budget is not a finance exercise. It is a diagnostic tool. It tells you whether your marketing function is structured to produce output or structured to produce results.

What Does the Forrester Framework Actually Cover?

Forrester has been publishing guidance on marketing planning and budget structure for years. Their framework is not a rigid template, but it gives marketing leaders a consistent vocabulary for categorising spend, which matters more than most people admit. When everyone in the room means something different by “marketing budget,” you cannot have a useful conversation about where the money is going.

At its core, the Forrester model separates what you spend to reach and influence customers (program spend) from what you spend to build and maintain the capability to do that (non-program spend). Program spend includes paid media, content production, events, sponsorships, and direct campaign costs. Non-program spend is the operational layer underneath all of that.

Non-program spend typically breaks into five sub-categories:

• People costs: Salaries, benefits, and employment costs for the internal marketing team.
• Technology: Software licences, platform fees, and martech stack costs.
• Agencies and contractors: Retained agency fees, project-based agency costs, and freelance spend.
• Data and research: Market research, audience data, competitive intelligence, and analytics tooling with a research function.
• Overhead and facilities: Office space allocated to marketing, shared services costs, and administrative overhead.

Each of these categories behaves differently in budget planning and each carries different risk. Understanding them separately is the starting point for managing them well.

If you want more context on how budget structure fits into broader marketing operations thinking, the Marketing Operations hub covers the operational frameworks that sit behind effective marketing functions.

Why Do Marketing Leaders Underestimate Non-Program Spend?

I have sat in a lot of budget reviews over the years, both as an agency CEO presenting to clients and as someone managing the P&L of a marketing services business. The pattern is consistent: program spend gets interrogated, non-program spend gets assumed. Media budgets get challenged line by line. The agency retainer gets renewed with a brief conversation. The martech stack gets reviewed when something breaks, not on a schedule.

Part of the reason is psychological. Program spend produces outputs you can point to: impressions, clicks, leads, revenue attribution. Non-program spend produces capability, which is harder to quantify and easier to take for granted. Nobody asks whether the marketing team is sized correctly for the volume of work it produces. They ask whether the Facebook campaign hit its CPA target.

The other reason is structural. In most organisations, non-program spend sits across multiple budget lines, often in different cost centres. Headcount is in HR. Technology licences sit partly in IT. Agency fees might be in procurement. Nobody has a clean view of the total, which means nobody is accountable for optimising it.

Forrester’s framework is useful precisely because it forces that consolidation. When you see all non-program spend in one place, the picture tends to be uncomfortable.

People Costs: The Largest Line Nobody Reviews

Headcount is almost always the single largest component of non-program spend. In a mature marketing function, people costs can represent 30-40% of the total marketing budget before a single pound or dollar has been spent on reaching a customer.

The strategic question is not whether you have enough people. It is whether you have the right people doing the right things at the right ratio to your output. When I was running an agency and grew the team from around 20 people to over 100, the temptation was always to hire ahead of the work. Sometimes that was the right call. Often it was not. Headcount is the stickiest cost in any business, and marketing functions inside larger organisations are not immune to that dynamic.

The Forrester framework encourages you to think about people costs relative to the other non-program categories. If you are spending heavily on headcount but also carrying a large agency retainer, that is worth examining. You are potentially paying twice for the same capability. That overlap is more common than most marketing directors would like to admit.

Team structure also matters here. How you organise your marketing team affects both cost and output. A function structured around channels rather than outcomes tends to accumulate headcount without accumulating accountability. You end up with specialists who own their channel metrics but nobody who owns the customer.

Technology Spend: Where Budgets Go to Hide

Martech has become one of the most significant and most poorly managed components of non-program spend. The average enterprise marketing function carries more software licences than it can effectively use. Tools get purchased to solve specific problems, those problems evolve or disappear, and the tools stay on the books because nobody is assigned to review them.

I have seen this at close range. Working with a mid-sized client a few years ago, we mapped their martech stack properly for the first time. They were paying for four separate tools that all had some form of landing page functionality. None of them were being used for landing pages. Two had been purchased to solve problems that were subsequently solved differently. The combined annual cost was material. Nobody had noticed because the licences renewed automatically and sat in different budget lines.

The Forrester framework helps here by treating technology as a distinct budget category rather than a line item scattered across operational costs. When you aggregate it, the number tends to be larger than expected, and the utilisation rate tends to be lower than expected.

The right question for every tool in your stack is not “do we use it?” but “does it produce measurable value relative to its cost?” Those are different questions. A tool can be used regularly and still not justify its cost. A tool can be used rarely and still be essential. Cost-per-outcome is a more useful lens than usage frequency.

Agency and Contractor Spend: The Category With the Most Strategic Flex

Agency and contractor spend is where most marketing functions have the most room to move, in both directions. It is also the category most likely to drift without active management.

Retained agency relationships are particularly prone to scope creep in reverse: you pay for a scope of work that made sense when you signed the contract, but the business has changed and the work has changed, and nobody has renegotiated the arrangement. The agency delivers what was agreed. You pay for what was agreed. But the alignment between what you are buying and what you actually need has quietly disappeared.

Having spent most of my career on the agency side, I have been on both sides of this dynamic. The honest truth is that agencies will not typically volunteer to renegotiate a retainer downward. That is not cynicism, it is commercial reality. The responsibility sits with the client to review the arrangement regularly and ensure it still reflects the work required.

Forrester’s framework encourages you to view agency spend not as a fixed cost but as a variable capability investment. The question is whether you are buying capability you cannot build internally, or paying for capability you already have but are not using. Both situations exist in most marketing functions. The framework gives you the structure to identify which is which.

Contractor spend deserves its own scrutiny. Project-based freelance costs are often the most responsive part of the non-program budget, but they are also the easiest to let accumulate without review. A series of small project fees can add up to a significant annual cost that, if consolidated, might justify a hire or a better-structured agency relationship.

Data and Research: The Category Most Likely to Be Underfunded

If technology spend is where budgets hide, data and research spend is where they disappear. In my experience, this is the non-program category most frequently cut when budgets come under pressure, and the one whose absence is felt most slowly and most painfully.

Market research, audience intelligence, and competitive analysis are not glamorous budget lines. They do not produce the kind of immediate, attributable outputs that justify themselves in a quarterly review. But they are the inputs that determine whether your program spend is pointed in the right direction. A campaign built on outdated audience assumptions or weak competitive intelligence is expensive in a way that never shows up on the media plan.

I judged the Effie Awards for a period, and the pattern in the winning entries was consistent: the strongest work was built on sharp audience insight. Not necessarily expensive research, but disciplined thinking about who the customer was and what they actually needed. The weakest entries had strong executions and weak strategic foundations. They looked expensive. They just were not built on anything solid.

The Forrester framework treats data and research as a distinct non-program category, which is the right call. It separates the cost of knowing from the cost of doing. Most marketing budgets conflate the two, which means research gets sacrificed when doing needs to be funded. That is a short-term saving with long-term costs.

For a broader view of how data infrastructure fits into the marketing operations picture, Forrester’s thinking on global marketing operations design is worth reading alongside the budget framework. The two are closely connected.

Overhead: The Category Everyone Ignores Until It Becomes a Problem

Overhead and facilities is the least glamorous non-program category and the one most likely to be excluded from marketing budget conversations entirely. In many organisations, marketing’s share of office costs, shared services, and administrative overhead is allocated by finance and treated as a fixed assumption rather than a managed cost.

That is fine when the allocation is accurate. It becomes a problem when the allocation no longer reflects reality, which happens frequently in organisations that have restructured, shifted to hybrid working, or changed the size of their marketing function without updating the overhead model.

The strategic value of including overhead in the non-program framework is not that you can manage it directly. It is that it gives you a true total cost of the marketing function. Without it, your cost-per-output calculations are understated, and your comparisons between internal capability and external agency costs are misleading.

When I was running a loss-making agency in turnaround, overhead allocation was one of the first places I looked. Not because it was the biggest number, but because it was the number most likely to be wrong. Overhead assumptions that made sense when the business was structured one way had been carried forward unchanged through two restructures. Correcting them did not solve the P&L problem on its own, but it meant we were working from an accurate picture rather than a flattering one.

How to Use the Framework in Practice

The Forrester non-program framework is most useful as a diagnostic rather than a prescriptive model. There is no universally correct ratio of non-program to program spend. It varies by industry, by the maturity of the marketing function, by the degree of in-housing, and by the strategic role marketing plays in the business.

What the framework does is give you a consistent structure for asking the right questions. Start by mapping your total non-program spend against the five categories. For most marketing functions, this exercise alone surfaces surprises. Technology costs are usually higher than expected. Data and research costs are usually lower than they should be. Agency and contractor spend often overlaps with internal headcount in ways that are not immediately visible.

Once you have the map, the useful questions are:

• What is the ratio of non-program to program spend, and is that ratio intentional or inherited?
• Within non-program spend, which categories are growing fastest, and is that growth producing proportionate value?
• Where does capability overlap exist between categories, particularly between headcount and agency spend?
• Which non-program categories are reviewed regularly, and which are renewed by default?
• Is the data and research budget sufficient to inform the program spend it is meant to support?

These questions do not have universal answers. But asking them on a structured basis, using a consistent framework, is how marketing functions move from reactive budget management to something more deliberate.

The marketing process that sits behind effective budget management is not complicated. It requires discipline more than sophistication. The Forrester framework provides the structure. The discipline has to come from the marketing leader.

For more on how budget frameworks connect to broader operational decisions, the Marketing Operations section covers the processes and structures that underpin well-run marketing functions.

The Ratio Question: Non-Program vs Program Spend

One of the more useful outputs of applying the Forrester framework is a clear view of your non-program to program spend ratio. This ratio is a proxy for operational efficiency, though it needs to be interpreted carefully rather than optimised blindly.

A marketing function spending 70% of its budget on non-program costs and 30% on reaching customers has a structural question to answer. That might be the right answer for a business in the process of building internal capability, or it might reflect a function that has accumulated overhead without commensurate output. Context matters.

What the ratio cannot tell you is whether the program spend is effective. A function spending 70% on program spend and 30% on non-program costs looks lean and efficient until you examine whether the program spend is producing anything. I have managed large media budgets across a range of sectors, and the most wasteful spend I have seen was not in the non-program categories. It was in campaigns built on weak briefs, pointed at the wrong audiences, with no clear commercial objective. The media cost was low. The return was lower.

The BCG work on agile marketing organisations makes a related point: the structure of the marketing function affects the quality of its output, not just the cost. Non-program spend, managed well, is an investment in that structure. Managed poorly, it is overhead that crowds out the work that actually matters.

About the Author

Keith Lacy is a marketing strategist and former agency CEO with 20+ years of experience across agency leadership, performance marketing, and commercial strategy. He writes The Marketing Juice to cut through the noise and share what works.

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