That’s according to a new research report, ‘The CMO of Tomorrow’ (registration required for a free copy) prepared by the Association for Data-driven Marketing and Advertising (ADMA) and Oracle Marketing Cloud.
Over 450 senior marketing executives around Australia, New Zealand, India, and Singapore, participated in the research survey which looked at how organisations are meeting the challenges and impediments faced in today’s digital market, and how their investments are likely to change in the year ahead.
The CMO of Tomorrow research found that marketers will need to be as familiar with a balance sheet as they are with an advertising campaign. They need to be comfortable around technology and have strong analytics skills around data. They must be able to engage with management peers at the top tier of the company to secure budget and get buy-in for significant cultural change.
At a media/analyst roundtable, Jodie Sangster, ADMA CEO, and Paul Cross, Group Vice President Customer Success, ANZ, Asia and Japan, Oracle Marketing Cloud, outlined the key findings of the report (for Australia):
- 62% have a specific revenue requirement in their KPIs.
- 84% say their analytics capabilities are either good or excellent.
- 36% consider themselves advanced to very advanced regarding “sophistication” in digital marketing with regards to people, process, and technology
- 29% failure by Australian executives to buy-in to digital marketing programs was the lowest level among all the countries studied.
Sangster said, “The CMO of Tomorrow understands marketing needs to translate directly to bottom line results. They build teams that can deliver a return on investment and create KPIs that deliver business outcomes.”
The research shows marketers are being given an increased remit, being responsible for customer experience. This extends beyond traditional marketing and requires other departments such as IT, Finance and Technology to play a critical role in delivering the outcomes. Marketers will need to collaborate and mediate at the executive leadership level to ensure the brand stays focused, and the executive team buys into an ethos of genuinely putting the customer first.
“Not every CMO is there today. The research shows significant differences between markets about CMO skills and focus. In many markets, there are major shortcomings that need to be overcome to ensure CMOs are prepared for the future,” Sangster added.
Cross said, “Senior executives want their marketers focused on business goals like revenue growth and return on investment, but many marketers are still too focused on traditional campaign metrics as a measure of success.”
The research highlighted the disconnect between what senior management define as a success which is revenue versus the campaign-specific metrics that many marketers still measure themselves on.
The main three impediments outlined in the report that marketers feel are preventing them from doing their jobs are:
- Budget: (50%) Budget was cited consistently around the region as the biggest or second biggest impediment. The failure of marketers to secure budget speaks to the wider issues of both seniority and an inability to describe the benefits and return on investment of digital marketing.
- Capability and Education: (48%) Marketers are grappling with the issue of finding the right skills and ensuring the capabilities of their existing teams are kept up-to-date.
- Return on Investment: (37%) Given their concerns over capabilities and skills and their knowledge and understanding of digital marketing technologies; it is little wonder that marketers struggle to mount a successful argument for further investment in digital marketing based on measures such as return on investment.
Cross said, “The research shows that significant impediments stand in the way of accelerating the roll out of digital marketing. There is a lack of education about digital marketing capabilities which makes it hard for marketers to understand ROI. Under the circumstances, it's no wonder they have trouble getting buy-in from other executives or getting their budgets approved. This has proved to be the biggest impediment of all around the region,” he added.
“On the upside, marketers are big believers in analytics. They believe they are gaining great insights already, with 44 per cent saying they enjoy analytics and 35 percent saying they are excited by them. “It is clear that the CMO of tomorrow is going to have quite a different role within organisations than in the past. Customer advocacy will be critical, and the CMO will need authority across much broader parts of the business to deliver the results,” he said.
Beyond the changes in their careers, marketers must also cope with the reality that digital disruption is transforming industries. It is breaking down the barriers between companies and even markets, and powering the emergence of fast-growing globally scaling competitors whose success rewrites the rules and discards the certainties of the past.
The research results provided an insight into key vertical markets including:
- Travel and Hospitality: Marketers in this sector are the most confident in their use of analytics. Over 90% rate their ability to gain insights from analytics highly, however, say their biggest impediment in their use of digital marketing technology is a limited marketing budget.
- Retail: Unlike other vertical markets where access to budget was considered the biggest impediment to digital marketing acceleration, marketers in retail cited a lack of understanding and education as the biggest impediment.
- Financial Services: Marketers in this sector, perhaps counter-intuitively, were among the least likely to have revenue targets and be accountable and measurable against those targets.
- Professional Services: Budget was rated as the biggest impediment to accelerating digital marketing efforts.
The convergence of communication and e-commerce channels, and the access to transaction data means CMOs of the future can link their marketing activity to financial outcomes. Making the right choice in marketing strategy, team, partners, and technology will be critical to their success.
As McKinsey & Company recently noted, in a paper called, ‘The Four Pillars of Distinctive Customer Journey, “… for every ten-percentage-point uptick in customer satisfaction, a company can increase revenues two per cent to three per cent.”