It comes as no surprise that CMOs are concerned with growth. Two-thirds of those surveyed in Deloitte’s Spring 2019 CMO Survey ranked it as their number one challenge, with more than a third ranking it as their top challenge. Interestingly, concern with growth was consistent across the board, regardless of size, industry, or sector. Below we’ll highlight a few CMO insights for 2019 from the study.
Overall, marketing executives are increasing their acceptance and use of analytics for decision making. One of the areas specifically called out is the use of artificial intelligence (AI) for marketing to personalized content, uncover consumer insights, and predictive analytics. The marketing function is also growing in their responsibility for new and different growth activities.
Areas of concern for CMOs are not that different from their c-suite counterparts. They are worried about the current uncertainty regarding economic conditions, spurred by various predictions of a global recession sometime in the next 18 months. They are also concerned with the increase in competition from known and unknown players. Finally, while they are embracing technology, the speed at which it moves also presents threats, both internally and externally.
The report covers ten topic areas listed below and we are highlighting five of them.
- Marketplace Dynamics
- Firm Growth Strategies
- Market Spending
- Firm Performance
- Social Media Marketing
- Mobile Marketing
- Marketing Job
- Marketing Organization
- Marketing Leadership
- Marketing Analytics
As mentioned above, optimism for the US economy among CMOs has dropped. It is at its lowest level since 2011. Another factor CMOs are taking notice of is the changing nature of the customer experience. Product quality is taking a back seat to relationships and pricing, which is a shift from past surveys. Finally, channel partners are expected to play a larger role in go-to-market execution, with nearly three-quarters of companies expected to use channel partners. This is up from just over 50% the past couple of years.
Firm Growth Strategies
Even with their concerns, CMOs remain positive in their ability to drive growth. The primary focus is on market penetration followed by product development and market development. Diversification is expected to see the least amount of investment. Overwhelmingly, spending is focused domestically, at 87% of total spend. This is a 10% increase over the past seven years. One interesting note is the drop in the percentage of overall company sales through the internet, falling under 10% for the first time since 2013. B2C services leads all economic sectors at 21%, while B2B product sales have the lowest percent of internet sales at 5.7%.
Overt the past three years, key financial performance metrics indicate growth over the past three years. Both profit and marketing ROI are increasing, and marketing metrics also indicate growth in brand value and customer acquisition.
With growth being the number one challenge, CMOs are more motivated than ever to show the ROI of marketing campaigns. The ability to illustrate financial results based on specific metrics to drive business growth is an imperative with their C-suite counterparts. With the increasing responsibility for growth, a new and evolving approach for many companies, two-thirds of CMOs said their roles are not well defined. Another area that is causing heartburn for marketing leaders is cause marketing. Consumer expectations are growing in this area, as is transparency. Combined with the politically charged atmosphere, it’s no surprise CMOs are wary of connecting their brand to specific causes or issues.
Spending on analytics is expected to grow over the coming years. Use of analytics has grown to its highest point in the study’s history, even though spending dipped. Improving perception of marketing contributions to overall company performance is one of the drivers of the increased focus on analytics. Just over one-third of CMOs said they have the quantitative tools to demonstrate the impact of their campaigns.
For the detail behind these trends, please check out the Deloitte report. And if you have questions or need help with your marketing leadership, from hiring to training options, send us a note, and one of our executive recruiters will respond as soon as possible.