Adapted and updated from a Response 2013 presentation developed with some data provided by the CMO Council. Presented at the MENG San Diego meeting in November, 2013
Vince Ferraro and CMO Council 2014 Marketing Trends, Directions, and Insights
1. CMO Council & Vince Ferraro
Trends, Directions and Insights
Vince Ferraro
Former VP of Corporate and Consumer Marketing,
Eastman Kodak Company
CMO Council Board Advisor
SDSU College of Business Board Advisor
VincentFerraro.com
11/28/13
MENG San Diego
2. What I Will Cover
• Top C-Level marketing trends
• Research from the CMO Council that will
highlight C-level executives’ sentiments on
the trends in the marketing mix
• What you need to do starting tomorrow
11/28/13
MENG San Diego
3. We All Want the Same
Thing!
New customers, conversion, sales
Source: http://www.4webmarketing.biz/sitemap.htm
11/28/13
MENG San Diego
5. The CMO Council
6,500+
Senior Corporate Marketing
Leaders
$350 billion
in annual marketing spend
controlled by CMO Council
Members
Seven
11/28/13
Influential regional chapters
led by Advisory Boards of
brand leaders
MENG San Diego
9. 144.8 billion emails sent
worldwide…per day
8.6 trillion SMS
messages sent
5.5 trillion App
messages sent
11/28/13
228 billion MMS
messages sent
554 million pieces of USPS
mail processed per day
MENG San Diego
11. Channel Reality: Mobile
By the end of 2013, there will be more mobile devices on Earth than people.
The average age for the first cell phone is now 13.
50% of the average global mobile web users now use mobile as either their primary
or exclusive means of going online.
The average consumer actively uses 6.5 apps throughout a 30-day period.
Global mobile traffic now accounts for 15% of all Internet traffic.
91% of mobile Internet access is for social activities versus just 79% on desktops.
One in three mobile searches have local intent versus one in five on desktops.
41% of people have used a mobile device to browse for a product after seeing it in a
show or advertisement.
80% of mobile device owners use mobile to enhance their shopping experience.
36% of shoppers search for other store locations on their phones while shopping in
store.
Tablet users spend 50% more money than PC users.
Source: http://mobileorchard.com/infographic-state-of-mobile-2013/
11/28/13
MENG San Diego
15. Video Drives Shopping
•52% of consumers say that watching product videos makes them more
confident in online purchase decisions.
•Video is a driver of consumer confidence. Consumers are willing to watch
videos 60% of the time they are found, and 52% of consumers report that
they are less likely to return a product after viewing a video.
•More than three out of five consumers will spend at least two minutes
watching a video that educates them about a product they plan to
purchase, and 37% will watch for more than three minutes.
•The Step2 Company found that shoppers who view video are 174% more
likely to purchase than viewers who did not.
•Online retailer Bizchair.com found that 33% of online sales came from
the13% of site visitors who viewed video
•34% of apparel shoppers are more likely to purchase after viewing an
online video ad, versus 16% after watching an ad on TV
Source: Invodo Video Statistics
11/28/13
MENG San Diego
17. Channel Reality: Social
What do they like?
• 67% of consumers want to be
eligible for exclusive offers
• 60% want the opportunity to
interact with other customers
• 65% want to gain access to
games and contests
11/28/13
MENG San Diego
(Source: CMO Council “Variance in Social Brand Experience)
18. Customer Reality: Over It
What’s the reaction?
• 41% would consider halting all
business and no longer purchase
from a company that continues to
send impersonal, irrelevant
clutter
11/28/13
MENG San Diego
19. Customer Reality: Over It
Why did they disconnect or
opt-out?
• 46% because communications
were not relevant to them
• 73% were irked over receiving
a promotion on a product they
already bought
• 39% ignore messages
because they are flooded (in
their mailbox and inbox)
11/28/13
MENG San Diego
26. How Has Social Impacted
Marketing?
a. Improved customer listening &
engagement
b. Opened new avenues to gather
insights
c. Increased the complexity of
planning
11/28/13
MENG San Diego
29. What Concerns You About
Social Investments?
a. Requires resources we don’t
have
b. I can’t quantify ROI or impact on
brand
c. Requires new competencies we
don’t have
d. I can’t control what’s
said about my brand
online
11/28/13
MENG San Diego
33. Marketing’s Mandate
a. Lower costs & improve go-tomarket efficiencies
b. Grow & retain market share
c. Drive top-line growth
d. Maintain high quality sales
pipeline
e. Improve customer insights
11/28/13
MENG San Diego
34. Budget as % of Revenue
11/28/13
MENG San Diego
40. where are
the digital
hero's?
9% enjoy highly evolved digital programs
4% feel they are leading their category
7% are extremely advanced in leading with data
41. What Are the Leaders Doing?
• They have high levels of approval
and strategic support at the LOB &
CEO level
• Formed task forces with IT and
partner with CIO
• Turning to customers – not internal
teams – to identify valued
technologies and channels
11/28/13
MENG San Diego
42. What Are the Leaders
Doing?
• In the next year they will add:
Marketing resource management
Campaign & workflow management
• 72% focused on the delivery of
timely, relevant and targeted
communications
• Measure success through:
11/28/13
Conversion rates
Up-sell & cross-sell opportunities
Response and engagement rates
MENG San Diego
43. Where Marketing Needs
Help
How can you help us?
Source: The Economist Intelligence Unit Limited 2012
11/28/13
MENG San Diego
44. It is All About Integration
Source:www.jamalaplanit.com
11/28/13
MENG San Diego
46. Content in action
Integrated Marketing
Requires Content to Be
Actionable
http://www.interleado.com/images/call%20to%20action.jpg
11/28/13
MENG San Diego
50. be
DISRUPTIVE!
Customer Evolution = Customer Revolution
Social, Social, Social
Have LOTS of BFF’s
Encourage Disruption..Then Make A
Commotion!
51. Change Management in
C-Suite
•
•
•
•
•
•
Big Data
Customer Experiences
Customer Engagement
Mobile Shift
Revenue Optimization
Personalized Content
To do all of this heavy lifting, marketing needs be viewed as a
center of excellence and take on dual roles as functional and
business leader
11/28/13
MENG San Diego
It is my pleasure to be here today.
Thanks to Tom Haire, and the CMO Council and the Response Expo 2013 team
I am speaking to you today not as direct response guru. There are plenty of them at this event.
Instead, I am going to speak as a chief marketing officer and business leader who procures all elements of the marketing mix, including direct response.
Here is what I will cover
Research from the CMO Council that will highlight C-level executives’ sentiments on the trends in the marketing mix
The role of direct response in a integrated marketing campaign
Thoughts on how the direct response community can get a greater share of our marketing budgets
In fact, a marketers we are all after the same things
We want a well qualified funnel, we want communications that present compelling offers and reasons to believe in our brands and products
We want to convert qualified leads into sales – both for repeat and new customers
And the role that response marketing plays is also evolving
This response time line shows how the marketing you all do has changed over time
From direct response of the 1950s fueled by radio, TV, and print to new forms of response enabled by the computer, internet, interactive web marketing, and the trend towards mobile, and social media
We have “responsive” web designs and we are heading (as ResponsiveAds) indicates to the world of responsive advertising …
By extending your existing desktop advertising/web assets to mobile and tablets instantly. The idea that mobile inventory should not be undervalued!
And a belief that all devices are created equal!
I am here representing the CMO Council.
Who Are they?
The Chief Marketing Officer (CMO) Council is the only global network of executives specifically dedicated to high-level knowledge exchange, thought leadership and personal relationship building among senior corporate marketing leaders and brand decision-makers across a wide range of global industries.
I sit on the North America board of advisors for this organization
The CMO Council represents:
Over 6,500 marketing brand leaders that
That control almost $350B in marketing spend
And has regional and international chapters all over the world, in 110 countries
OK So do I have your attention now?
Every Year The CMO Council conducts research with this base of marketing leaders
The findings of the 2012 “State of Marketing” report indicate that the role of the CMO now encompasses more critical customer touch-points that directly impact the customer experience, and executives who are up to the challenge are being compensated based on their performance and impact on the business.
The outlook is distinctly positive for marketers as executives head into 2013 with renewed confidence in their roles and business performance.
It is global benchmark of marketing spend and intentions was drawn from the insights and contributions of more than 550 senior marketing executives representing North America, Europe, Asia-Pacific, the Middle East, Africa and South America
Nearly 65 percent of these marketers report directly to a president, CEO or chief operating officer. More than 30 percent of respondents represent companies with more than $1 billion in annual sales; 11 percent represent companies having between $500 million and $1 billion in sales; and 30 percent are with companies with revenues between $50 million and $500 million.
I will share recent results from this survey
First, let’s look at the multi-channel customer
We like to imagine that our consumer lives like this…hanging out at home, surrounded by a happy family, with plenty of time to consume all of the amazing experiences we have created for her…
In fact, she is ready, willing and able to not just consume, but she is ready to act. She loves us, she needs our content. But here is the reality…
This poor family is drowning in a sea of messages…and they all want them to act now…
Ever since the advent of social media, e-mail has become increasingly relegated to second-tier technology status,
With new reports coming out on a regular basis that claim e-mail open rates are down
As a result, marketers are better served by focusing their efforts on social media marketing. … The story goes
While the reality is email click thru rates, open rates, and volume are declining, there is still a strong role for email marketing
Despite the plethora of new social technologies out there, e-mail remains "the most effective and inclusive" way for marketing professionals to reach consumers (study by Search Engine Watch)
And B2B business still believe in the power of email
Well What Do We Like?
We like Exclusivity, Offers, and Interaction
67% of consumers want to be eligible for exclusive offers
60% want the opportunity to interact with other customers
65% want to gain access to games and contests
And Truth Be Told, We Live in a Burger King World
We “want to have it our way”!
We want it personalized, customized based on our demographics, psychographics, and purchase history
We want it now, and on a variety of computing, smart phones, and tablets
The outcome if we fail to achieve this?
41% would consider halting all business and no longer purchase from a company that continues to send impersonal, irrelevant clutter. How is that for customer feedback?
Let’s look at these customer realities
Why do customers disconnect or opt out?
46% because communications were not relevant to them
73% were irked over receiving a promotion on a product they already bought
39% ignore messages because they are flooded (in their mailbox and inbox)
Now I want to turn my attention to the multi-channel marketer
Last year, Gartner released a blog post that predicted that by 2017, the CMO will spend more on IT than the CIO.
Believe this or not, what is obvious is that more and more customer experiences are powered through digital channels today…and yes, the CMO owns those experiences. But in reality…
CMOS KNOW NOTHING ABOUT MAINFRAMES AND DATA CENTERS!!!!!
And what CMOs are more often than not building is a loose tapestry of lots of little digital solutions.
36% of marketers admit digital strategy is made of random point solutions built over time.
This was certainly the case when I managed corporate and consumer marketing for Eastman Kodak.
In fact, My team spent countless hours trying to get 5 different reports all containing important information to integrate better so we could get the report we really wanted.
I love word clouds
When the CMO Council asked where marketers were seeing success in their digital strategies, these five areas were the top…but consider this…
We marketers have gotten caught in the channel comfort zone.
Someplace in between all the things we used to do in traditional channels…we started doing the same things in digital channels!
But here is the big problem…we have started adding faster moving channels…that still sit, alone, separated, and disconnected from an overall customer engagement strategy.
Let’s look at social as a prime example of this…
How has Social Media impacted marketing?
Engagement and customer listening
New insights that come from the conversations in forums, social media, and other online channels.
These are all good things to be sure.
Except … this has increased the complexity of digital channel marketing in an environment, where most marketing leaders whom I know, are trying to do more for less.
But ladies and gentlemen, let me introduce you to social media.
ALL of this…every single scary piece of this overwhelming pie is social.
You can see the various segments of specialization
Now, if you are like me and like a bit more order…then it starts to look like this…good luck thinking this is going to be any less confusing.
But here is marketing’s reality. It isn’t pretty is it?
In fact, it is overwhelming to most of us.
But when you REALLY look at this list, most marketers were concerned about number 4…
Many of us still think we can control it!
Which, of course, is wishful thinking.
You see we used to think about brand marketing or customer engagement as a series of attempts…
if we got TWO PERCENT of people to respond…it was AWESOME!!!!! A BASKET!!!!!!
But then, customers decided they could talk back. And we had to change EVERYTHING.
We had to rethink and reshape where and how all of our “asks” were being constructed and connected.
I am going to shift gears now and talk about marketing spend intentions?
Remember that $350B I mentioned earlier?
Marketing’s mandate is pretty consistent
We are paid to do more with less
Lower costs
Drive GTM efficiencies
Grow or retain market share
Drive top-line growth
Drive sales pipeline
And get better customer insights.
No wonder the CMO position is a revolving door at most companies
79% of marketing budgets, as a % of revenue, is 6% or less
40% of marketing budgets are <=2% of revenues
And only 8% of company’s have budgets greater than 10% of revenues
40% of the marketing spend is focused on product marketing, strategy and branding, sales support and website properties
With 60% in a variety of other buckets
This chart shows the allocation of program spend in marketing. No surprises here
Pretty balance mix of marketing spend
The good news is that 82% of marketing leaders think the value of their vendors and partners is pretty good, average, or extremely valuable
When asked why they did not rank their vendors, the top 3 reasons were lack of innovation and value-added thinking, business results, and campaign outcomes, quality and consistency of service
Think about it … it comes down to innovation, ROMI, and quality measures.
OK, so who is doing it right…really getting this connected digital landscape together and connected…well, good thing is…we asked!
We conducted a study called Integrate to Accelerate Digital Marketing Value,
We noticed that 9% of respondents said they had highly evolved programs…4% said they were a leader in their category…and 7% were advanced in managing data and basing engagements on data…
So what did THESE guys have in common???
What are the leaders doing?
CEO & Line of Business Support (Crucial)
Formed task forces with IT and the CIO
Customer, external focus
Value Creation
My perspective is that this does not happen in most companies. Why? Marketing is not seen as strategic. Instead it is viewed as just enabling or supporting sales (which is also important. Conversation should be AND.
This slide is self explanatory
What should be notice is the fact that delivering communications and success rates of conversions, up-sell, cross-sell, and response rates
I had an epiphany here. You see … what we market leaders need is what the leaders in response channels make happen every day for your customers
Is this an opportunity for you. I think so
I like this list because this is what (we ) marketers think we will be investing next year
Analytics, CRM, Social media, and mobile are the largest.
How can all of you help us?
I like this slide because in demonstrates the complexity and integration that is required to manage the marketing mix
We must make these tradeoffs and mix decisions for most of marketing – whether that be brand management, new product launches, demand generation … the list just goes on and on!
And when you think about this what we are really talking about is delivering great content – whether that’s an offer, to educate our customer, or manage customer engagements online and through social media.
It is all about the content.
And if it is content, it needs to be made actionable.
When I was at HP we realized, back in 2007, that we could no longer afford to do marketing that did not have a call to action.
So from the mountain of Vesuvius (actually it was HP Palo Alto) there came the word … all future marketing deliverables must have a call to action.
But when you think about response channels, this what you do so well
And to make actionable content, requires a call to action.
If you asked me where I think the landscape is changing fast,
It is in gamification
More customization and personalization of marketing deliverables and sales communications
In what I call a “purchase cycle interruption”
Meaning with my GPS enabled phone (in Target), you can cross-sell or up-sell me something at Wall Mart. When I go online to compare prices
So where does this go for you and your customers?
How can you take these insights and make them work for your business?
Here are some ideas …
What does all of this mean?
There are changes brewing in the C-suite
While we are being asked to do big data analysis, deliver exceptional customer experiences, and create new ways to engage the customer
More and more marketing leaders must take on the role of business and marketing leader
Think Customer First…
we used to start with our push campaign. Start with an email…start with a commercial. Now, we have to think about the customer. Where is he/she?
Where and how could he/she start an engagement that ends with multiple transactions of product and content?
Add those media channels…and don’t forget ALL of the social channels where they might talk about their purchases…and then look to create a super-consumer…not just a single sale.