According to the current IBM C-Suite Study, CMOs are wielding more power in the boardroom, as CEOs increasingly call on them for strategic input. The CMO now comes second only to the CFO in terms of the influence he or she exerts on the CEO. A growing number of CMOs are also liaising closely with CIOs with remarkably positive effects on the bottom line. Where the CMO and CIO work well together, the enterprise is 76% more likely to outperform in terms of revenues and profitability.
CEOs rely increasingly heavily on CMOs for strategic input:
On the other hand, very few CMOs have made much progress in building a robust digital marketing capability. Only 20% have set up social networks for the purpose of engaging with customers, for example, even though online input is a crucial part of the dialogue between a company and its customers. The percentage of CMOs who have integrated their company’s interactions with customers across different channels, installed analytical programs to mine customer data and created digitally enabled supply chains to respond rapidly to changes in customer demand is even smaller.
In 2011, 71% of the CMOs interviewed felt underprepared to deal with the data explosion. Today, 82% feel that way. Two-thirds of all CMOs also report that they’re not ready to cope with social media, which is only marginally less than was the case three years ago.
CMOs, however, are not ignoring technology’s potential, says the report, planning to make even greater use of some key marketing technologies in the next three to five years. Predictive analytics and mobile applications are particularly high on their wish lists, although customer relationship management and collaboration tools come close behind. And 74% of CMOs intend to partner more extensively in the future to help them realize their goals.
“To succeed in the digital era, you have to be totally in sync with the behavior and preferences of your customers in a fast-changing landscape. You have to be quick and adaptable.” CMO, Retail, United States
With a current gap between aspiration and action, it’s questionable whether CMOs are moving fast enough to keep up with the speed at which the commercial landscape is evolving, opines the report. The study found that “… our biggest challenge is creating the data infrastructure.” A CMO, Insurance, New Zealand, says
The Traditionalists are just setting off. 37% of the respondents, they’re challenged by the data explosion, the growth in social media and the plethora of new channels and devices; have yet to integrate their physical and digital sales and service channels; seldom engage with customers via social networks; and rarely use analytics to extract insights from the customer data they collect.
The Social Strategists, 33%, recognize social media’s potential as a vehicle for engaging with customers, and are building the infrastructure they’ll need to operate in the social arena. But, haven’t yet begun to exploit the opportunities arising from the data explosion and advanced analytics.
The Digital Pacesetters, 30%, are reasonably prepared for the data explosion and well placed to handle the increasingly heavy social and mobile traffic from a growing range of devices. They’re also actively putting the resources required to operate as a fully integrated physical-digital enterprise in place, and regularly use advanced analytics to generate insights from customer data.
The Digital Pacesetters in the survey have invested far more heavily than Traditionalists or Social Strategists in capturing and analyzing data during every phase of the customer lifecycle. Digital Pacesetters typically have a far clearer picture of their customers than other CMOs. Enterprises with a deep understanding of their customers are 60% more likely to be financial outperformers, says the report.
The CMO of a German chemicals company notes that “… marketing is a data-driven science… (but) people often see it as a ‘nice-to-have’ because they don’t think it drives the future of the company… (however) marketing is actually about using data to target audiences and create value… it’s about monetizing things…”
Digital Pacesetters lead the way in building an infrastructure and rewarding customer experiences: 82% of Digital Pacesetters expect digital channels to play a bigger role in their interactions with customers in the next three to five years, compared with just 64% of Traditionalists and 76% of Social Strategists.
CMOs have the same top priorities for managing digital change, but they seem to have given up on taming social media. Monetizing social media has sunk to the bottom of their agendas. Only a quarter of Traditionalists and two-fifths of Social Strategists and Digital Pacesetters are attempting to make money via social channels. The rest see social mainly as a tool for building awareness and forging connections.
Design customer experiences for tablet/mobile apps
Position social media as a key customer engagement channel
Deploy an integrated software suite to manage prospects and customers
Monitor the brand via social media
Measure the ROI of digital technologies
Conduct online/offline transaction analysis
Develop social interaction governance, guidelines, policies, etc.
Gain comprehensive visibility of supply chain
Monetize social media
A significant number of Traditionalists are still wrestling with relatively basic problems such as developing a set of digital guidelines. Social Strategists, by contrast, are more concerned with conducting transaction analysis, while Digital Pacesetters are preoccupied with managing the customer relationship and creating a transparent supply chain to fulfill orders rapidly.
CMOs face different challenges for much the same reason, depending on how far they’ve gone down the digital path:
Lack of a cohesive strategy for leveraging social media/business 71%
Other competing priorities or initiatives 58%
Undefined return on investment 50%
Other competing priorities or initiatives 62%
Lack of appropriate technology 61%
Lack of a cohesive strategy for leveraging social media/business 54%
Other competing priorities or initiatives 61%
Undefined return on investment 59%
Lack of a cohesive strategy for leveraging social media/business 51%
Concluding, the report offers salient comments by two of the respondents:
The CMO of a Canadian bank noted, “… we’re increasing the emphasis on the customer… building a better understanding of digital, mobile and social media… drawing insights from knowledge and analytics… collaborating with technology partners to enhance the customer experience.”
But the gap between desire and daily reality large as the CMO of a Brazilian professional services firm explained, “… the only way CMOs can… close the gap is by invoking their growing influence in the boardroom… other C-level executives don’t have a deep knowledge of marketing… so they don’t understand marketing as a strategic role… ”
For additional information from IBM click here.