Almost a year into the Covid-19 pandemic and amidst enormous death and suffering, we have witnessed a year full of transformation and challenge for the field of marketing. The 26th Edition of The CMO Survey captures the digital, social and political upheaval the field has experienced and offers insights to guide marketers. Here are the top results based on a sample of 356 marketing leaders at for-profit U.S. companies, 94.5% of whom are VP-level or higher.
- Marketers’ optimism about the overall economy has rebounded beyond mid-pandemic and even pre-pandemic levels. Optimism hit 66.3 (out of 100), up dramatically from 50.9 reported in June 2020 in which optimism plummeted nearly to Great Recession levels of 47.7 in 2009.
- A strong customer experience emerged as the most important customer priority—more important than product quality, a trusting relationship, and superior innovation—with over one-third of marketers rating it their customers’ key priority. Perhaps because of this, 72.2% of marketers reported that the importance of marketing in their companies increased during the last year. With customer demands for digital experiences growing, marketers have been placed in a stronger position to deliver this value.
- Internet sales rocketed to 19.4% of overall sales—the highest level reported in survey history, reflecting a 43.7% increase over the last year. B2C Product and Service companies reported the highest levels (32.1% and 26.8%).
- Marketing spending decreased by 3.9% over the last year but is expected to grow by 14.3% in the next year. Despite overall losses, marketers report an 11.5% increase in digital marketing spending in the last year, pointing to a major shift in how marketers are spending their budgets. This focus is expected to continue with digital budgets predicted to grow by 10.1% in the next year.
- Marketers converted this digital spending to returns with a 32.7% increase in contribution from digital marketing to company performance over the last year. One reason for these returns is that marketers made investments to expand their digital marketing capabilities, reporting a 27% improvement in digital marketing skills. Company website optimization was the main focus, with 73.8% of marketers reporting investment, and 65% of marketers reporting investments in digital media and search, followed by direct digital marketing (57.3%), data analytics (56.5%), and marketing technology platforms (54%).
- Marketers focused their attention on building brand value that connects with customers and retaining customers throughout the pandemic and into 2021. However, their focus also shifted to acquiring new customers (+48.6%) and improving marketing ROI (+105.5%), indicating companies are moving from survival to a renewed focus on growth and profits—in other words, from defense to offense. Considering opportunities, marketers continued to shift resources to building digital interfaces and transforming go-to-market business models during the pandemic with digital interfaces growing by 21.0% since June 2020. In addition, reflecting an emphasis on growth, marketers report an increased emphasis on expanding into new products and services (+14.3%) and building partnerships (+9.6%).
- This pandemic year has been filled with social and political upheaval that has also challenged marketing leaders in important ways. Marketing leaders reported an increase of 8.8% in marketing spending on Diversity, Equity, and Inclusion (DE&I). Work on brand and marketing communications were the areas of greatest focus for this spending. Only 5.6% of companies reported “very highly” that they developed an inclusive approach to marketing decision making.
- More marketers now believe it is appropriate for brands to take a stand on politically-charged issues, with a 49.7% increase in the last year to reach 27.7%—the highest level in survey history. Considering the types of political activism appropriate for brands, the dominate response was encouraging citizens to vote (92.9% of marketers), followed by supporting a specific piece of legislation (43.5%) and making changes to products and services in response to political issues (26.5%). Marketers have made significant efforts to support or change social issues in the past year. Actions to encourage COVID-19 safeguards dominated (82.2% of marketers) led, followed by racial equality (59.4%), gender equality (43.9%), and LGBTQ+ equality (40.0%). Climate, health, education, and immigration lagged and tended to be backed by sectors with a stake on the topic (e.g., climate issues were the focus of the energy sector).
- Companies reported 8.2% of marketing jobs were lost in the last year. These numbers are similar to the 9.0% loss in the June 2020 survey, indicating levels did not worsen over the last six months. Of these losses, 28.1% were senior manager roles. The hardest hit sectors were B2C Services (12.3%). Job additions have also occurred in the last year—a 9.1% overall increase occurred with 17.7% of these being senior managers. Looking across job losses and gains at the company level, gains were slightly higher (net job change = 0.9%) but that this metric varies by sector, with Education (9.9%) and Healthcare (9.2%) rising to the top on net gains. In other sectors, job levels stayed constant, but the mix of marketers changed—likely reflecting the influx of more digital marketers.
- AI and machine learning in the marketing toolkit has shown increasing implementation, with ~10% increase in use year over year since 2018. Expectations for future AI and machine learning use are even higher and are predicted to increase ~20% in the next three years.
Detailed analysis of these results and a set of companion reports from a pilot of The CMO Survey run in the UK in conjunction with London Business School are available at https://cmosurvey.org/results/. The effect of Brexit on marketing is addressed in the UK results.