CMOs’ Nightmare Alley: ROI, Private Labels, New Brands
Image above: Many CMOs are touchy about private label brands, among the biggest winners during the pandemic. These are Target’s.
When chief marketing officers are staring at the ceiling at 2 a.m., they can take comfort in knowing that most of their peers are stressed about the same problems.
In a new survey of marketing execs, Brand Keys finds that 98% of top marketers say their return-on-investment for marketing spending is a top concern, up 1% from the last survey back in 2019.
And a whopping 30% of worries are due to the pandemic. “They’re what I call ‘Nightmares of the new abnormal,’” he says. That includes pandemic-linked problems such as supply chain snags, managing work-from-home teams, vaccinations and masking issues.
But the biggest surprise on the list, says Robert Passikoff, founder and president of Brand Keys, is “competition from new brands,” the fifth-most mentioned fear, named by 91% of respondents.
“There have always been new brands,” he tells Marketing Daily. “But this stems from the disruption caused by supply-change challenges. When customers couldn’t find Charmin toilet paper or Purell hand sanitizer, they bought something else.”
Store brands and private labels were among the biggest winners in this scenario. And amid surging ecommerce and changing customer behaviors, regaining those customers is more complicated.
The survey, ranking every concern mentioned by more than 75% of respondents, finds that the fastest-rising fear is “keeping consumers engaged with my brand,” cited by 86%. That represents an 11% jump from the previous survey, giving that worry what Passikoff calls “monster-in-the-closet” status.
Managing agency relationships, a new concern, plagues 84%. And finding advertising content that relevant and engaging troubles 83%.
Passikoff predicts that the widening gap between consumer desire and brand delivery will become a much greater source of torment, even as COVID-connected issues recede a bit. “Customer experience will continue to get more complex,” he says. “People expect much more in the way of differentiation. Spending massive amounts on advertising isn’t enough to do that any longer.”
Brand Keys started the research as a companion to its ongoing loyalty research, the Customer Loyalty Engagement Index.
Over the years, the index has recorded plenty of disruptions, as some brands soar and others fade from consumers’ awareness. Against that backdrop, “we started asking the CMOs and brand execs we work with what keeps them up at night.”
Passikoff thinks consumer insights will ultimately offer CMOs the only path forward in the uncertain year ahead.
“Nobody can deny that COVID and its restrictions have changed consumers. If CMOs and brand managers take a deeper look at howconsumers shopped before the pandemic, they’ll see clues as to how consumers were about to transform.”
Those trendlines, he says, will continue to have predictive value.