CMOs are in a precarious position in 2015. More budget is going toward digital marketing, but they can’t quantify the business impact—and CEOs are losing faith.
Duke University’s Fuqua School of Business released the findings from their CMO survey, a biannual report on the budgets, strategies, and opinions of marketing executives.
The three stats below reflect the current challenges facing CMOs this year, when the pressure to deliver quantifiable results is higher than ever.
Digital marketing spend is estimated to rise by 14.7%, the highest figure in at least 3 years.
Traditional advertising spend is projected to decrease by 1.1%, while digital marketing spend is expected to shoot up significantly and across all sectors (B2B and B2C products and services). It shouldn’t come as a big surprise, as this trend has been consistent when it comes to allocating marketing’s budget to better optimize web properties to increase conversion, generate leads, and—as we’ll see below—tie these efforts to revenue.
Online, marketers can track behavior, track and target specific people based on behavior, personalize messaging, and inexpensively test tactics for engaging prospects. By going digital, marketers are taking key steps toward proving business value, not to mention keeping up with consumer trends and habits. But…
Only about 4 in 10 CMOs report being able to prove the short-term impact of marketing spend on their business quantitatively. Even fewer (34%) are able to prove the long-term impact quantitatively.
CMOs know they need to focus on digital—this is hardly a new revelation. But there are still a lot of gaps to close. The problem? Lack of alignment across teams and tools.
Digital marketing technology is powerful because it allows marketers to track behavior, gather metrics, and deliver relevant content based on the specific interests of a prospect, and gather metrics. But to get meaningful results, technology needs to be integrated across teams, channels, platforms. Unless these tools can “speak” to one another, CMOs will never be able to map their efforts to short-term—and definitely not long-term—results.
6 in 10 CMOs surveyed say that they feel pressure from their CEO or BOD to prove the value of marketing, and all say that the pressure is either increasing (58%) or remaining steady (42%).
80% of CEOs say they don’t trust their marketing teams—and marketers know it. Marketing budgets have been increasing, but this study shows that marketing budgets are down from 10.9% of the total firm budget to 10.1%. If CMOs can’t start proving value by mapping revenue and opportunities to their efforts, they’re going to lose the faith of the organization (if they haven’t already). The gaps need to be filled, and it can’t wait any longer.
The need for an integrated technology strategy and firm marketing metrics has come to a head—and it’s resting on the shoulders of the CMO.Business & Finance Articles on Business 2 Community