The explosion of data in the world today of Chief Marketing Officers is remarkable. Even though this tsunami of information is overwhelming, when used smartly with the right tools, it can make an organization's marketing more powerful. So what are the skills needed today by the CMOs of the new millennium? How are CMOs fairing in the sea of 2.5 quintillion bytes of data? Are their organizations prepared to manage the change?
In a recent marketing event I attended last week, Tom Mangan, a North American Leader for Business Analytics & Optimization Strategy from IBM shared that more than 1700 CMO's from 64 countries and 19 industries revealed that majority of the world's brightest marketing executives recognize a shift occurring in the way they engage with their customers. This shift places customers in the driver's seat and new marketing approaches, tools and skills are required for companies to stay competitive. He went on to add that the two biggest forces that are affecting organizations today are market and technology factors. He further emphasized that the four challenges that could be universal game changers are Data Explosion, Social Media, Proliferation of Channels, and Shifting Consumer Demographics.
CMOs are aware of this changing landscape, but are struggling to respond. More than 50 percent of CMOs think they are underprepared to manage key market forces – from data explosion to social media to greater customer collaboration and influence. This indicates that they will have to make fundamental changes to traditional methods of brand and product marketing.
Managing the Four Challenges
Data explosion: Faced with 2.5 quintillion bytes of data, the increasing volume, variety and velocity of data available from new digital sources like social networks, in addition to traditional sources such as sales data and market research, tops the list of CMO challenges. As most of these data are unstructured, CMOs need to know how to analyze these vast quantities of data to extract relevant insights and use them effectively to improve products, services and the customer experience.
Social platforms: Social media has become an important platform for companies today. Marketers are using these platforms to communicate but they still struggle with capturing valuable customer insight from the unstructured data that customers and potential customers produce.
Channel and device choices: The growing number of new marketing channels and devices, from smart phones to tablets, is quickly becoming a priority for CMOs. Most companies would have gone mobile within the next 5 years. Mobile commerce is expected to reach $31 billion by 2016, representing a compound annual growth rate of 39 percent from 2011 to 2016. Meanwhile, the tablet market is expected to reach nearly 70 million units worldwide by the end of this year, growing to 294 million units by 2015.
Shifting demographics: New global markets and the influx of younger generations with different patterns of information access and consumption are changing the face of the marketplace. In India, as one example, the middle class is expected to soar from roughly 5 percent of the population to more than 40 percent in the next two decades. Marketers who have historically focused on affluent Indian consumers must adapt their strategies to market to this emerging middle class. In the United States, marketing executives must respond to the aging baby boomer generation and growing Hispanic population.
Taking a look at these 4 factors, CMOs who successfully harness this new source of insight will be in a strong position to increase revenues, reinvent their customer relationships and build brand new value. This is why I personally feel that Marketing Analytics will play a pivotal role in this road to success. In my previous post "The Future of Marketing: Where does Analytics fit in?". I explained how the growing role of Analytics is important for marketing in the future.
Taking a look at these 4 factors, CMOs who successfully harness this new source of insight will be in a strong position to increase revenues, reinvent their customer relationships and build brand new value. This is why I personally feel that Marketing Analytics will play a pivotal role in this road to success. In my previous post "The Future of Marketing: Where does Analytics fit in?". I explained how the growing role of Analytics is important for marketing in the future.
Even more so today, CMO's need to quantify the value they bring to the business, be it from investing in advertising, new technologies or any other activity. If they are to be held responsible for the marketing returns they deliver, they must also have significant influence over all "Four Ps": promotion, products, place and price. Sadly, CMO's only have a strong influence over the promotion factor. They play a smaller role in shaping products, place and price. To put it plain and simple, the traditional Marketing MBAs are not trained to have the skills that are needed to respond to this new era of social consumerism and advertising companies are facing a talent gap of employees who know digital and are quantitatively fluent.
Even though the traditional Marketing MBAs who are presently the CMOs of top companies recognize the importance of analyzing the real-time impact of data, the lack of ability to incorporate marketing analytics causes them to still focus on 20th century traditional marketing approaches such as market research and competitive bench marking. These methods won't cut it in today's business environment. Today’s CMOs have to cover more ground than ever before. They have to manage more data from disparate sources, understand and engage with more empowered customers, adopt and adapt to more sophisticated tools and technologies, while being more financially accountable to their organizations. This is where I feel fortunate as a student from the MSc in Integrated Marketing at New York University. Covering all the traditional aspects of marketing, as well as the more contemporary ones such as digital and marketing analytics, I will have the knowledge and ability to create a greater impact in all the Four P's of marketing.
CMOs of the past may be comfortable making decision based on gut feel, but today that will not cut it. The stakes are much higher. They have to make decision based on facts and this is where Analytics will take the front seat in an organization.
For organizations that still think marketing analytics is still hiding in the background, they need to think again. Companies need to ask themselves these questions: Would they like to be proactive in their decision making? Would they like to adjust their strategy based on the look into the future? Would they want to side step problems and capitalize on opportunities long before their competition? If the answer is YES, then they are on the right track to success. Marketing Analytics will provide the power to know. It will provide the power to know your customers, the power to know your suppliers, and the power to know each and every aspect critical to your business. Most of all the power to know and understand what lies around the next corner. After all to gain a competitive advantage is to be a couple of steps ahead from the competition. I will leave you with a video from the IBM CMO Study 2011.
Ideas from: Insights from the Global Chief Marketing Officer Study - From Stretched to Strengthen
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