Insights into the changing world of Chief Marketing Officers: IBM C-suite Study 2014
The world as CMOs (Chief Marketing Officers) know it is changing, which prompts the question: How are CMOs across the globe adapting to the digital transformation? Last week IBM released the first instalment of their 2014 Global C-suite Study – the seventeenth in the ongoing series of C-Suite Studies developed by the IBM Institute for Business Value. In this report 4,183 of the world’s top executives from over 20 countries were interviewed to help answer this very question.
The report aimed to understand how these executives are earning the loyalty of their “digitally enfranchise” customers. It focused on how CMOs are helping their enterprises to become more “customer-activated”. A total of 524 CMOs were interviewed in person, and the findings can be used as a great platform to develop predictions and build future successful marketing strategies to cope in the digital world.
CMOs’ Changing World
As the nature of the role of CMOs is changing due to the global digital transformation, they are being faced with many obstacles. The findings outlined in IBM’s “Stepping up to the challenge” report unveiled that although the digital transformation is bringing about positive and encouraging advancements, at the same time it is creating hurdles for many CMOs as they struggle to keep up with the rapid changes.
First: the positive news. On average CMOs are gaining more power in boardrooms and liaising more with CIOs world-wide, increasingly being called upon for strategic input. In fact, enterprises are 76 percent more likely to outperform others in terms of profitability and revenues when their CMO and CIO work cohesively together. In addition, many CMOs reported that they have plans to increase their use of key marketing technologies, such as predictive analytics, mobile apps, and CRM and collaboration tools.
However there is always a flip side to every coin. Although many CMOs have plans to utilise technology’s potential, unfortunately they seem to be experiencing difficulty actually building their digital marketing capabilities and developing a strong digital marketing strategy. This is highlighted by the fact that only 20 percent of CMOs interviewed had created social networks to engage with their customers. A retail CMO from the US highlighted this issue, stating that in order to be successful in rapidly changing digital era, marketers need to be “quick and adaptable”, and increasingly in tune with their customers’ behaviours and preferences.
Furthermore even fewer CMOs have successfully integrated their company’s interactions with customers across different channels, created digitally enabled supply chains to respond to the constantly changing consumer demands, and installed analytical programs to source and acquire customer data.
This situation is reportedly even worse than it was back in 2011, when 71 percent of CMOs interviewed reported feeling underprepared to respond to the “data explosion”. This figure has risen to 82 percent today. Furthermore, two-thirds of all CMOs responded to the survey saying that they feel unable to cope with social media. This number is only slightly smaller than reported in 2011, which highlights the current lack of social media awareness and understanding in businesses across the globe. CMOs and businesses need to shift their focus towards building a conversational relationship with their customers.
Although CMOs are not necessarily ignoring the opportunities created by technology, the report has exposed a serious disparity between CMOs’ objectives and their actions. This issue is further fuelled by the fact that CMOs are not progressing and adapting fast enough to keep up with the rapidly evolving commercial landscape.
The three distinct profiles of CMOs
1. ‘The Traditionalist’
This type of CMO is only just coming to terms with the technological and digital transformation. They are finding it difficult to adapt to the growth in social media and masses of new marketing channels, are struggling to assimilate their physical and digital sales and service channels, and are not yet connecting with their customers through social media networks. The Traditionalists are also not taking advantage of analytics tools to help collect customer data and information.
2. ‘The Social Strategists’
This category of CMOs is doing a much better job at assimilating and adjusting to the changing world of marketing, however they are not yet completely embracing the marketing revolution. They have acknowledged the huge potential for interaction with customers that social media offers businesses, and as a result they are focusing on building strategies to take advantage of this opportunity. Despite this, they are yet to take full advantage of the growing number of marketing channels and rapidly advancing analytics tools.
3. ‘The Digital Pacesetters’
This category represents the most advanced and best prepared segment of CMOs. They have wholly embraced the marketing revolution and data explosion with both hands. Already using many social media channels and having integrated their marketing strategy, the Digital Pacesetters are on their way to developing a “fully integrated physical-digital enterprise”. In addition they are not only aware, but also exploiting the opportunities created by advancing analytics tools to gather customer data and generate customer insights.
- CMOs are aware of the opportunities presented by the data explosion and marketing revolution
- However CMOs currently feel underprepared and ill-equipped to deal with it
- There is “a close link between the degree of digital acumen CMOs display and the financial performance of the enterprises for which they work”. (Stepping up to the challenge; IBM Institute for Business Value)
- There are still incredible opportunities available and potential financial growth for businesses when their CMOs embrace the marketing revolution, data explosion, advancing analytics tools and growing number of social and digital platforms.
All images courtesy of IBM Institute for Business Value