• April 14, 2009
  • By Jessica Tsai, Assistant Editor, CRM magazine

Can Marketers Afford Customer Centricity?

The Chief Marketing Officer (CMO) Council recently released the results of its Marketing Outlook 2009. The report -- sponsored by Deloitte Consulting, business community platform Jigsaw, and research firm Ad-ology -- surveyed 654 marketers worldwide. The economy has certainly motivated marketers to be more responsible, with a greater share (34 percent) of respondents indicating that economic conditions have "sharpen[ed] our focus and reduc[ed] our spend." An emerging trend for this year is an increased focus on digital and social marketing-a skill that companies will be training existing employees for, rather than hiring new talent. Yet, despite ambitious goals toward a more customer-centric strategy, marketers still lack the necessary level of collaboration with their technology teams.

From the CMO Council's perspective, marketers have a role that goes beyond just the bearer of the brand. According to Liz Miller, vice president of programs and operations at the CMO Council, the chief marketing officer should be both the chief sales supporter as well as the owner of the customer experience. "It's great to make sure you have that beautiful artistic marketing front," Miller says. "But at the end of the day, what marketing really needs to be doing is driving business."

By now, every marketer is touting the "customer-centric" business model, but based on Miller's research, it's more often said than done. Customer data, she says, is still siloed across the organization, an obstacle that can only be overcome once marketing embraces both business and technological intelligence.

The CMO Council, she admits, has traditionally been the organization that wags its finger at marketing's shortcomings. However, results of the study indicate that marketing is taking strong initiatives this year. "In a period where we would completely understand a gloomy, depressed view of budgeting and allocation," Miller says, "marketing has surprising everyone by bucking convention and...taking this opportunity to grab market share."

The largest share of respondents (48 percent) have goals of growing or retaining their market share. At the same time, 44 percent want to not only lower costs but improve go-to-market efficiencies. Fortunately, 81 percent of marketers believe their goals for 2009 are "realistic and attainable," while only 4 percent said no. More than half of marketers expect budgets to stay the same or increase in 2009.

Instead of reducing headcount -- 38 percent of marketers anticipate no change in staffing in 2009 and 57 percent say they don't feel their jobs are at risk -- marketers are instead opting for retraining and developing existing staff members (62.9 percent), while 28.6 percent reveal plans to recruit new talent and 17.1 say they will outsource. Existing employees already have a grasp on the company's value proposition and processes, such that additional training will serve more specifically to address the demands in new media, Miller says. However, new media, is "still a gray, fuzzy area for marketers," Miller says -- 33 percent reporting that they feel ill-equipped to handle new media opportunities, and 32 percent who say they have a "limited understanding."

According to the study, the top influencers for marketing budget allocations are:

  • Customer anxiety and cutbacks (49 percent);
  • Slower, more complex selling cycles (38 percent); and
  • Reduced consumer spending (33 percent).

Further down on the list at 14.9 percent was "financial market disarray." Miller views these results as a positive force because marketers are making decisions not for the sake of general economic precautions; rather, marketers are investing in areas that respond to consumer expectations, needs, and level of anxiety. Even before the economic crisis, Miller says consumers have been anxious by the shear number of choices available, so no matter what conditions consumers face, it's the marketer's responsibility to respond accordingly.

It seems strange, however, that despite goals toward more social capabilities, 45 percent of marketers say that email marketing -- by now, a fundamental communication tool between businesses and consumers -- will be a "new" marketing automation solution they will be deploying. This was followed by 33 percent who indicate social networking or online community building and another 33 percent for online surveying and research. The juxtaposition of the top two solutions seems surprising as it suggests that though marketers are looking to new channels, they are still struggling with the basics.

The data also reveals an inconsistency in marketing objectives as 28 percent indicate that they plan to deploy Web analytics and multivariate testing; and yet, in terms of tools for operational and functional efficiency, the majority of marketers cite Web properties and digital platforms (13 percent), strategy and branding (12 percent), and product marketing (12 percent), well above, marketing systems (5 percent) and customer data integration and analytics (4 percent).

There needs to be a strong push towards education and understanding of analytics, Miller says. Before, all marketers asked about were page views, clicks, and traffic. With Web analytics, they're able to create sophisticated predictive models that provide direct insight into returns and measurement.

It's not enough, however, to leave it up to the technology. "I've seen the metrics & data that can come out of an Omniture analytics package and sometimes you'll get that report and your eyes start to cross," Miller empathizes. "If you're a CMO with 90 things on your plate, you're looking at [Web analytics] person thinking, ‘You'd better bottom line this for me.'"

The disconnect is rooted in one critical misperception among marketers -- the idea that they can do it alone. One finding in particular, which Miller calls "disconcerting," is the fact that only 9.3 percent of marketers indicate that they want to build a closer relationship with the technology department or the chief information officer.

As much as software vendors boast "business-friendly" solutions, companies, especially enterprises, need technological expertise. "When something breaks," Miller says, "there's one group we call." At this point, the market is still relatively immature. There's still a significant amount of data that needs to be extracted, mined, and interpreted. Now with social added to the mix, the job is only going to get more technical, and more complicated.

"Sales and marketing can find valuable partners in technology," Miller says, "if only we stopped our internal rhetoric to figure it out."  

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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