CMOs Not Optimistic in Post-COVID Era
As the country slowly reopens after months of COVID-19-related shutdowns, chief marketing officers are still bracing for hard economic times ahead, according to research from business and technology consulting firm West Monroe Partners.
Among CMOs, the top concern right now is burning through their cash reserves, cited by 35 percent of them. Layoffs had been the top concern in March as the pandemic was ramping up, but West Monroe believes that those fears might no longer be a concern if layoffs have already occurred.
The research found that 65 percent of CMOs expect the current economic crisis to last longer and to go deeper than the Great Recession of 2008. That is up 10 percent since March.
At the same time, 41 percent of CMOs expect their company operations to stabilize in this year’s third quarter. For comparison, 55 percent of chief information officers believe there will be a shorter recovery, and 37 percent of CEOs don’t expect a recovery until 2021 or beyond.
“Our first survey in March found that half as many CMOs (24 percent) thought recovery would be short compared to CEOs (50 percent),” says Casey Foss, CMO at West Monroe.
“At the beginning of this crisis, CMOs were pushed to completely rethink their go-to-market strategy and target markets to address the behaviors of buyers that were forever changed. CEOs, meanwhile, were hoping for a V-shaped rebound. Now that seems to have flipped.… The shift in CMO perspective is not because the belief that buying behaviors were forever changed was wrong, but businesses have mobilized to meet their buyers where they are. Meanwhile, CEOs are realizing the amount of change their organizations are going to have to undertake, and as a result expect a longer recovery.”
To help their organizations strategically pivot, more than half (53 percent) of CMOs are setting up significantly new digital/e-commerce capabilities, the research found.
Additionally, once shelter-in-place orders lift and employees can return to the office, the biggest challenge will be managing a business through social distancing measures, including flexible scheduling and work locations, say 41 percent of CMOs. Gartner found recently that 74 percent of companies plan to increase remote work rather than having everyone return to an office.
Company leaders have also been forced to change tactics and approaches.
“CMOs have taken greater responsibility to propel efforts that align brand and client interactions better with corporate values. Organizations that have always valued authenticity and integrity are positioned to thrive, while organizations that didn’t put grace, humanity, and integrity at the center of their culture and core values pre-pandemic cannot shift their market-presence now because it will be seen as opportunistic and inauthentic,” Foss says.
But CMOs have other post-COVID-19 challenges. Forrester Research recently identified outside agencies as the one marketing component that will be hit the hardest, projecting negative growth of -30 percent and -20 percent, respectively, during the next two years.
In that same time frame, Forrester estimates that U.S. marketing agencies will shed 52,000 jobs through 2021.