In order to uncover the most important business trends affecting CMOs, their marketing teams, and their companies, we’ve systematically reviewed the literature on the subject. Drawing from sources like Deloitte’s latest CMO Survey and articles written by McKinsey’s subject matter experts, Agency Spotter has determined the hardest-hitting trends to be 1) multiplying consumer channels, 2) the growing influence of third-party content, and 3) new accessibility to previously unavailable markets. Here’s why each of these trends matter.
1. Multiplying consumer channels mean CMOs don’t know where to begin
The Internet has created infinite opportunities to engage consumers. One-on-one marketing is now possible – a prospect that has inspired frenzied exploration of new, promising distribution media. In fact, the average percentage of marketing budgets allotted by companies for the development of this media is projected to double in the next three years.
Even though close to a quarter of marketers admit they haven’t determined how this media will deliver value (Figure 1), they are spreading their budgets and attentions thin in order to accommodate them despite their uncertainty. To avoid an endless series of sunk costs, the modern CMO must strike a balance between innovation and judiciousness.
In 2017, the ANA Masters Circle denounced the lack of transparency associated with “unmanageably complex digital media supply chains” as one of the biggest problems marketers face daily. That means every possible step to ensure marketing alignment and transparency should be taken. As things get more complex, it is critical that the CMO, their organization, and their agencies know exactly what is being done and who’s doing it.
CMOs can be proactive in this effort by making sure they have the right agency partner working on each channel (e.g. a specialist social media agency versus a generalist agency of record who may not go deep enough on key social media channels). Agency Spotter’s ability to filter agencies by service areas, audience specialities, MarTech platforms, and even industry expertise can help you take advantage of specialization and avoid digging money pits. That way, CMOs are able explore more new channels under less pressure.
2. The power of an individual’s content outweighs what a company has to say about itself
Around 70 percent of people look up product reviews while in the physical shop. Thus, the advice of in-store sales staff is increasingly ignored, even at stores were associates are not paid on commission.
This logic also applies elsewhere: As 60 percent of baby boomers use the Internet to supplement their physician’s advice, even doctors are losing credibility. CMOs should know and act upon the fact that new found buyer skepticism is influential, and it is causing consumers to flock to a more reliable source: other consumers.
As of August 2017, the first contact a person has with a product is more likely to occur via a third-party source (e.g. a blog, YouTube video, product review sites) than on a company website (Figure 2). This is not surprising when you consider the fact that one third of the time people spend online is spent consuming user-generated media.
Major shifts like these signify a change in the way people connect with businesses and a drop in the amount of control these businesses have over their reputations. Third-party word of mouth – be it good or bad – now travels more easily than ever, especially to the 2 billion people active on social media worldwide.
Some agencies specialize in services that help shape the conversation and give some control back to the CMO and their teams. Explore what agencies in service areas like affiliate marketing, influencer marketing, word of mouth marketing, social media, and of course PR are doing to help companies pro-actively navigate third party content.
Finding the right marketing mix on this front can mean the difference between collaborating with the public as an ally or fighting against it in an uphill battle. Use Agency Spotter as a tool to help you take the right course of action while managing your spend effectively.
3. Markets are not emerging, our ability to access them is
Many CMOs say they’re targeting emerging markets, but perhaps it is better to think about it as taking advantage of emerging access to these markets. Basically, we now have the capability to access a more diverse set of people than ever before.
This is because the Internet is becoming more available to the people within these markets thanks to a) loosened restrictions on content in some places and b) increasing incomes in others. Although the information playing field is becoming more level, the culturally-specific needs of the people in these markets remain. Top CMOs (e.g. GE’s Linda Boff) are completely restructuring their marketing organizations in order to keep up with the demand for local understanding.
A CMO establishing a presence in a new region must keep in mind that a centralized team can only do so much. Outsourcing is one way to face this fact, and because of this it has been steadily trending up for the past few years (Figure 3). Though the practice is generally thought of as an easy way out, there is value in cultivating partnerships with agencies that understand your business but also understand locational nuances. Why not tap into resources that are already operating within target market? Thanks to Agency Spotter, finding a marketing agency partner in India, Brazil, Singapore, China, or Australia is now much easier.
The time to philosophize about the changes affecting CMOs has run out. These three CMO trends will shape the future of most large marketing organizations and they have already begun to change media spend and processes. A crisp understanding of these shifts will help you identify which of them are most relevant to your role within your organization, and to act accordingly. As always, Agency Spotter is here to help.
- Consumer channels are multiplying… Using analytics to track efficacy from the get go will help you explore them more responsibly.
- People care less and less about what companies have to say about themselves. Dedicating yourself to different types of reputation management across your channel strategy will help you harness the power of increasingly powerful third parties.
- Markets are more accessible than ever. Building capability to access and efficiently apply local knowledge of them will help sustain profitable global engagement.
The CMO Survey, Deloitte – 2017
Forbes’ Reinventing the Role of the CMO
The Truth About Online Consumers, KMPG – 2017
How the Role of the CMO is Changing, MarketingProfs
Building a Marketing Organization that Drives Growth Today, McKinsey – 2017