Simon Falconer
For many businesses in this industry the mission has been to understand what customers think. However, increasingly the big question is not so much ‘what’ as ‘why’? If we can understand the underlying motivations behind consumer behaviour then we can more accurately predict what they will think and do in the future.
But too often, in our pursuit of this mission, we forget to suitably consider our clients’ businesses. Whilst we engage with them on a daily basis, do we always, hand on heart, pay enough attention to understanding their thinking and how the broader objectives they have for growing their business relate to the work we are developing for them?
Prompted by a desire to delve deeper into the mind of the international CMO, we ran a series of one to one interviews in late 2011 – probing specifically on the role digital is playing in their work as marketers to grow their businesses – for 2012 and beyond.
With a cross-section of verticals and B2C / B2B business engaged, you’d expect a broad range of themes and priorities to emerge but we were somewhat surprised at the level of consistency across the different organisations.
The initial tsunami-like impact of digital on business structures, capabilities and strategies has now been well absorbed. The early confusion and complexities that first wave created meant a thorough and rapid rebuilding phase has ensued. The second wave is now upon us, bringing significant challenges again, but with firmer foundations on which to brace and tackle them. This second-wave is also more focussed, with fewer, but still sizeable challenges and opportunities.
Here’s how we see the current trends, the challenges they throw out, and from those challenges, three imperatives
Current trends
Digital Integration
“…digital is the love of our life. It’s very important in communications, it’s very important in customer service, it’s very important in how we build our customer experiences. Digital is pervasive in everything that we do.”
Barry Judge, CMO, Best Buy
That digital must be integrated throughout the entire marketing function is now a given. Few CMOs see significant standalone functions remaining in place much longer. The focus is now on the role digital should be playing as an enabler across all functions of the business. Digital is blurring organisations boundaries, making horizontal links where there used to be silos between business functions – for instance between core marketing and retail or shopper marketing.
As such, CMOs’ responsibilities and required areas of expertise are being stretched horizontally. Two areas in particular are keeping this catalyst so active: social media and data analytics.
Focus on brand building
The priorities are changing; for those marketers who have been focussing on channel-defined activation, attention is moving back to deeper, brand-led engagement activities.
One of the drivers is increased consumer accessibility enabled by digital infrastructure and platform improvements. Another driver is social media, which offers marketers the potential to develop richer experiences in the context of the environments where people are already spending more of their online time.
A new set of brand-building priorities is emerging, including:
- Shareable content: content and experience development that has ‘share-ability’ and is designed to enable and encourage advocacy. This applies to B2C and B2B businesses, and also for PR or Corporate Communications influencer outreach.
- Co-creation and experience marketing: encouraging and welcoming consumer input to brand marketing campaigns.
- Brands as enablers: consumers are looking to express themselves online and usually welcome brands who enable this.
Renewed faith in the brand idea
CMOs have developed renewed faith in the central ‘brand idea’. They are exploring how this can – and should – manifest in the digital realm: where the idea is central and channel selections and execution approaches all flow from it. For some the brand idea has guided their digital work from the outset. But for many others, the strong tides of digital response, such as Search Engine Marketing (SEM), have moved them further away from the central brand idea. For these CMOs the current redirection is a more significant change.
The resurgence is for two main reasons:
- Today’s more empowered digital consumer has more influence on a brand’s digital manifestation and reputation. With a stronger central idea, the CMO is seeing more success in maintaining the key essence or message they wish to convey, as it is remixed and shared by consumers.
- The proliferation of digital touchpoints means it’s now rarely feasible (and increasingly ineffective) to develop highly tailored ideas for every touchpoint – so they must be prioritised. Using the central ‘brand idea’ as the northern star, touchpoints are then more readily selected on their ability to effectively deliver the idea; a great balancing force to the temptations offered to marketers by the ongoing influx of new technologies & digital touchpoints.
“It’s been our experience so far that – because of the global nature and the speed in which information travels – you have to define your brand very clearly upfront. You have to really know who you are. And then you have to drive those values consistently.”
Simon Sproule, CVP Global Marketing Communications, Nissan
CMOs’ challenges
The need for executional speed
CMOs agree that execution needs to be faster, whether it is planned for or reactive. This is especially true for the multinational CMO who must drive growth across disparate markets.
There are two main areas of focus for CMOs in order to deliver this:
- Agency consolidation
- Strengthening the marketing organisation
Agency consolidation
CMOs are consolidating agency rosters to create a more seamless service which mirrors the way digital is now horizontally embedded across all their marketing capabilities and the broader business. Crucially this is allowing them to execute faster. As digital has become the ‘new normal’, so agencies are integrating it across their offer and there is less need for specialists. A reduction of the time a CMO allocates to managing the roster and executing account reviews is a must.
With the renewed focus in the central brand idea, CMOs see it as a natural move to up-weight relationships with agencies that are the guardians of the central idea or have a long-term role in building the brand.
Strengthening the Marketing Organisation
Digital has changed the structure of many marketing functions. Social media and direct interaction with consumers has led to powerful co-creation in innovation and relationship management. CMOs are strengthening their capabilities to capitalise on this impact by working more closely with colleagues in product development and shopper marketing.
Further strengthening is coming from the following areas:
- Centrally resourced and executed marketing ‘innovation and experimentation’ – and for some, centrally orchestrated innovation, executed locally
- Enhanced ‘IT’ for marketing capabilities
- Best practice identification and dissemination
- Development of ideas that maintain their integrity across markets, but are flexible enough to allow local customisation for relevance
- Standardised creative development processes
- Standardised metrics for digital ROI evaluation allowing faster norms development and market on market comparisons (more below on ROI)
“Digital has led to a complete revamping of the view and role of IT and their role within the organisation. We have created a digital marketing IT function that works adjacent with my team – that incorporates data reporting so that the IT function is marketing-driven.”
Larry Bruck, SVP Global Media & Marketing Operations, Kellogg Company
Making data work harder
For the CMO sourcing data is not a problem. The issue is more one of over-supply. The main focus is on how to make digital data assets work harder; to generate insights, improve targeting and personalisation and deepen engagement. Advantages are seen in data’s ability to provide more tailored experiences.
“When I have had that face-to-face with a consumer, I have a huge opportunity to grab data and start building ……and if I use your data right I am serving up experiences, data, content, information, engagement that is really useful and interesting for you. So experience is actually a huge net for us to get data and get opt-in and that sort of thing.”
Wendy Clark, SVP Integrated Marketing & Capabilities, Coca-Cola
Enhancing analytics capabilities
Many are ramping up their in-house data and analytics expertise. Departments are doubling in size for some, with specialists being sought from outside the usual marketing recruitment pool; analytics and statistics specialists, data visualisation experts and user experience designers are all now actively recruited.
This is an exploratory phase for most CMOs, with some looking to develop expertise in-house, and others bringing in third-party specialists to help define the objective and shape the solution.
A high priority is placed on connecting currently disparate data streams in a bid to create value that is greater than the sum of the parts. The challenge is that whilst there is consensus on the importance of connection data, there isn’t yet any clarity on the destination yet let alone the route to get there. For the time being it is first-party data integration that tends to be number one on the agenda. The CMO and CIO are increasingly working together and the CMO is now a ‘shared stakeholder’ in data sources previously considered outside their usual remit – for instance, CRM and ecommerce data.
Summary
Through these trends and challenges, three over-riding CMO imperatives emerge:
Imperative 1: Digital engagement and the brand idea
Attention is now very much on deeper consumer engagement through ‘owned’, ‘earned’ and ‘shared’ media – with ‘paid’ increasingly marching towards automation. Through a renewed focus on the core ‘brand idea’ across all digital efforts, the CMO is realising notable gains in effectiveness and efficiency.
Imperative 2: Analytics to make data work harder
Data is proving to be the bonding ingredient across the marketing mix. If anything, data supply exceeds demand for the CMO. Instead their main focus is on how to make digital data streams work harder – to generate insights, improve targeting and deepen engagement.
Easily said, but what does this mean exactly? CMOs currently see clear advantages in data’s ability to provide more tailored and personalised consumer experiences. The CMO and CIO/CTO are working more closely together, with the CMO now a ‘shared stakeholder’ in data sources previously considered outside their usual remit.
Imperative 3: Speed of execution and organisational change
‘Digital is the new normal’ for the CMOs we engaged. It’s integrated throughout the marketing function and where it has not already done so, the CMO-led integration is now catalysing digital’s role as a broader business enabler and creating new horizontal connections across business functions. From this wide-ranging role of digital flows one particularly important implication – the need to execute more quickly. From internal capabilities to agency partner selection, many CMOs are structuring their teams to ensure that they can deliver more quickly – to respond to real-time customer feedback and to stay relevant with a broader group of influencers at the speed the business and customers now demand.
Simon Falconer is Global Digital Director at TNS
