Thanks to technology, today's customers are highly connected and vocal, demanding to be understood and thought of as individuals. The digital revolution - fueled by the increasing influence of social media, mobile commerce, and the proliferation of data is challenging conventional mass-marketing assumptions, skill sets and strategies.
To understand the implications of these changes, IBM conducted its first-ever Global Chief Marketing Officer Study interviewing more than 1,700 CMOs from 64 countries. CMOs are at the forefront of a seismic shift as organizations recognize the need to rethink how they create and deliver value to their customers. Like the CEOs we interviewed in 2010, 79 percent of CMOs anticipate significant levels of complexity over the next three to five years, and only 48 percent feel prepared to handle it.
Marketing to the Empowered Customer
Today's customers can shop around the globe, find out more than ever before about the organizations they're dealing with, and share their views with hundreds of thousands, if not millions, of fellow customers. Their expectations -- be they consumers, citizens or business customers -- are soaring. And they can make or break brands overnight.
CMOs must respond to these empowered customers by pioneering a new approach to marketing that focuses on individuals and not just market segments. Still today, at least 80 percent of CMOs rely on traditional sources of information such as marketing research and competitive benchmarking to make strategic decisions.
While these sources are important, other digital/social sources, such as blogs and consumer reviews provide rich information about customer sentiment that can help marketing understand how individuals think, feel and behave. But far fewer CMOs are leveraging these opportunities.
The rise of the empowered customer also demands increasing degrees of corporate transparency. Today, how a company behaves and operates -its corporate values--is becoming as important as what the company sells. More than half of CMOs said corporate character contributed to the success of their brands. And yet, 57 percent reported more work was needed to get employees on board. Although traditionally, corporate culture and values have been managed by HR, corporate transparency now places this also within Marketing's domain. Seventy-five percent of CMOs believe they must manage their brand reputation within and beyond the company.
Challenges Leading to Opportunities
The four factors CMOs say will impact them the most - and for which they feel least prepared to manage - are a reflection of the empowered customer being in control: the explosion of data (71 percent), social media (68 percent), the proliferation of channels and devices (65 percent), and shifting consumer demographics (63 percent).
In addition to grappling with these challenges, CMOs are now being asked to demonstrate the ROI of their marketing investments in advertising, new technologies or any other activity.
CMOs are well aware they will have to be much more financially accountable in the future. Sixty-three percent of respondents believe marketing ROI will become the most important measure of success over the next three to five years. This increasing emphasis on ROI also reflects the scrutiny the marketing function is currently attracting, itself a reflection of the function's growing prominence. The role of the CMO is evolving from gatekeeper and guardian to strategic business adviser.
These changes are not just fleeting symptoms of volatile times, but permanent shifts that require new strategies, new technologies, and new skills. The greatest risk lies in failing to act - while others commit, execute and evolve.
Learn more about the 2011 Global CMO Study at here.