According to a study by IBM, CMOs have made their way to the top table, but what challenges are they expecting to face? Alex Blyth reports
The role of the CMO is changing fast. It is becoming less focused on the creative aspects of marketing, and more focused on the analytics side, and this is putting CMOs right at the top table when it comes to strategic corporate decision making.
These are exciting times for all CMOs, but equally they are challenging times, a fact that was reflected in the study Stepping up to the challenge: How CMOs can start to close the aspirational gap, which IBM released in March 2014.
The study was based on findings from face-to-face conversations with more than 500 CMOs from 56 countries and 19 industries worldwide, and was conducted by IBM’s Institute for Business Value. The resulting study provides interesting reading not only for those currently in the role of CMO, but also those who aspire to it in the future.
Finding 1: Mobile has arrived
On one level the challenge for CMOs is to keep pace with the rate of channel shift. According to the IBM study, 94 per cent of marketing leaders believe that mobile applications will play a significant role in helping them reach their goals over the next three to five years. This is up from 80 per cent three years ago.
What is perhaps most surprising is that six per cent of respondents do not expect mobile to play a significant role. For some time now, sales of mobile devices have exceeded that of desktop PCs. We are seeing traffic on those devices taking off to an equal extent. Now for half the world’s internet users mobile is their primary tool for getting online, and 37 per cent of all digital media time is now spent on mobile devices.
As Simon Edelstyn, MD of Outbrain Europe and judge at the 2014 Mobile World Congress Awards, comments: “No matter which country they live in, people want to consume their content on the go, wherever they are and whatever they are doing. Mobile device penetration, whether phone or tablet, continues to increase in dominance and is reflected in the growing level of content created for and discovered through mobile devices.”
For many years mobile has been a channel on the rise. It has now risen to the point where no CMO can afford to ignore it, and all must be placing it right at the core of all their work.
Finding 2: Social media worries CMOs
Equally, social media has become the place where consumers and business buyers gain purchasing information. “The increasing control buyers have over the sales process is one of the main challenges facing CMOs today,” comments Judith Niederschelp, general manager at Harte Hanks Market Intelligence Europe. “Typically, buyers are now self-educated, and some sources say they don’t consult suppliers until their purchase decision is 57 per cent complete.”
Yet, according to IBM’s study, 66 per cent of CMOs feel underprepared for the growth of social media. Many of them admitted it is evolving too fast for them.
Another study perhaps points to a solution to this problem. The Global CMO Report 2014 from Salesforce ExactTarget Marketing Cloud found that dedicated social teams are almost as common as dedicated email teams: 57 per cent of respondents have a social team while 59 per cent have an email team.
It may be that the more forward-looking CMOs – the ‘digital pacesetters’ that IBM cites as the financial outperformers – are bringing in social media expertise. They may not be experts themselves, but they are building a team of experts.
Finding 3: CMOs are not ready for the data explosion
Another striking finding from the IBM study was that while 94 per cent of CMOs believe advanced analytics will play a significant role in helping them reach their goals, 82 per cent say their organisations are underprepared to capitalise on the data explosion. That is up from 71 per cent three years ago; remarkably, CMOs are becoming less, not more, confident about their ability to translate the data explosion into an insight explosion.
Kyle Lacy, senior manager of content marketing & research at Salesforce ExactTarget Marketing Cloud, comments: “Our own research has revealed a need among 52 per cent of CMOs for data and analytics expertise. Many cite data acquisition, testing and optimisation as their top internal priorities for 2014, and the number one external marketing priority is providing a personalised experience – which of course depends on data.”
The issue is not so much that CMOs lack data analytics expertise – as we have seen, the smart CMO is able to buy in skills and knowledge. The greater issue is the shortage of suitable experts and the absence of effective tools for data collection. Far too many marketers are focused on collecting data that keeps score, and too few use data to drive better insights. The 82 per cent of CMOs who are concerned about their ability to capitalise on the data explosion need to invest in analytics experts and processes that enable action.
Finding 4: Embrace digital for financial success
To further reinforce the growing importance of digital and data, of the three types of CMO identified by IBM in this study – ‘traditionalists’, ‘social strategists’ and ‘digital pacesetters’ – it is the last who deliver the strongest financial results.
They make up only 30 per cent of respondents, compared to 37 per cent and 33 per cent for the other groups respectively, but that will change. As Niederschelp at Harte Hanks Market Intelligence Europe, notes: “In this environment, fostering better alignment between marketing and IT is essential. One example of this in practice is revenue performance management – a systematic approach where people, process and technology collaborate to drive revenue growth. This makes use of data in a tangible way, enabling better optimisation and quantification of marketing activity within a demand generation model.”
She adds: “As marketing becomes more data and systems driven, achieving a
strong relationship with IT will be a critical success factor. Demonstrating the positive impact of IT-marketing alignment on revenue is a good starting point.” Indeed, according to the IBM study, the CMOs who enjoy close working relationships with their CIOs, are also likely to deliver better financial performances.
Finding 5: CMOs are closer to the top than ever before
Equally, marketing is finding itself ever more present in the boardroom. “Increasingly, CMOs are asked to be more than proficient marketers, but also to act as the stewards of the customer within their organisations,” observes Suzanne Kounkel, principal with Deloitte Consulting, and leader of customer and CMO services. “A spearhead for actionable customer insights via analytics, the CMO is at the centre of proving marketing ROI, innovating digital interactions, and launching new technologies that create enterprise-wide customer transparency.”
For years marketing has sought this place at the top table, and it now appears within the grasp of many CMOs. For the less digitally-literate CMO these may be challenging times, but for all CMOs – indeed all who work in B2B marketing – they are also exciting times.
