CMOs see shift in consumer engagement
Global - While most of the world's CMOs acknowledge a shift in the way they engage with their customers towards digital, many question their ability to manage rising challenges.
In a study conducted by IBM, it found that 82% of CMOs say they are planning to increase their use of social media over the next three to five years. Currently only 26% are currently tracking their blogs, 42% are tracking third party reviews and 48% are tracking consumer reviews to help shape their marketing strategies.
Close to two-thirds of CMOs think that return on marketing investment will be the primary measure of its marketing effectiveness by 2015. However half of them feel insufficiently prepared to provide hard numbers.
A majority of the respondents say they lack significant influence in key areas such as product development, pricing and selection of sales channels.
"The inflection point created by social media represents a permanent change in the nature of customer relationships," said Carolyn Heller Baird, CRM research lead for IBM institute for business value and global director of the study.
"Approximately 90% of all the real-time information being created today is unstructured data. CMOs who successfully harness this new source of insight will be in a strong position to increase revenues, reinvent their customer relationships and build new brand value."
With the internet, customers are their experiences widely online, giving them more control and influence over the brand. This shift in power requires new marketing approaches to stay competitive.
However 50% of respondents think they are unprepared to mange key market forces such as social media, customer collaboration and more, many indicated they would make changes to their traditional methods of brand and product marketing.
Customers across various demographics have embraced social media, presenting marketers with opportunities to increase revenue, brand value, and relationship between enterprises and buyers.
There are four challenges that marketers are confronted with, with a large majority of CEMs feeling unprepared to mange their impact.
Data explosion is a concern because everyday we create 2.5 quintillion bytes of data. The increasing volume, variety and velocity of data from digital sources such as social networks, in addition to traditional sources make it difficult to analyse vast quantities of data to extract meaningful insights.
Social platforms are difficult because tools such as social media enables anyone to become a publisher of information. 56% of marketers view social media as a key engagement channel, but struggle to capture valuable customer insight from the unstructured data.
The growing number of marketing channels and devices such as smartphones and tablets, it is quickly becoming a priority for CMOs. Mobile commerce is expected to reach US$31 billion by 2016, while the tablet market is expected to reach nearly 70 million units worldwide by the end of this year.
Shifting demographics is a challenge to CMOs due to new global markets and influx of younger generations with different patterns of information access and consumption. The middle class is expected to rise up by 5% of the population to more than 40% in the next two decades.
Most CMOs have traditionally not been expected to provide hard financial evidence of their ROI, but given the current economic situation, organisations want evidence results from their marketing initiatives.
In order to meet these challenges in the next three to five years, 28% of CMOs said they would boost their technological competence, while 25% said they would sharpen their social media expertise and 16% said tightening their financial acumen.The study was conducted between February and June 2011, coming to face-to-face with 1,734 CMOs in 19 industries and 64 countries. The respondents came from a wide variety of organizations, ranging from 48 of the top 100 brands listed in the 2010 Interbrand rankings to enterprises with a primarily local profile.
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