Here are my top ten results from the August 2019 CMO Survey. These results are based on a sample of 341 top marketers at for-profit U.S. companies, 95% of whom hold the position of VP-level or higher.
#1—Marketing Budgets: Marketing budgets are expected to grow by 8.7% in the next year-nearly reaching the 8-year high of 8.9% from 2017. This compares to a 6.3% actual increase in the last year. Consistent with this, marketing budgets as a percentage of overall firm budgets match the highest level in history of The CMO Survey at 12%, which is also 9.8% of overall firm revenues.
#2—Marketing Leadership: Three important findings related to marketing leadership emerged from the August 2019 CMO Survey.
- Although 73.5% of marketing leaders are unlikely to use their brands to take a stance on politically-charged issues, this percentage is trending down from the 82.6% who reported being unwilling in the February 2018 Survey. B2C companies are most likely to take a stance.
- Marketing leaders believe that new technologies have strengthened the importance of marketing in their companies, scoring an average of 2.75 on the scale where 7=significantly strengthened and -7=significantly weakened.
- On the negative side, 2 out of 3 marketing leaders state that they tend to focus on “managing the present” rather than “preparing for the future.” I would like to see the use of new technologies help marketers shift to a more dominant forward-looking stance.
#3—Marketing Analytics: Budget spent on marketing analytics has grown steadily over the last three years, rising from a low of 4.6% of marketing budgets in 2017 to the current 7.2%. This level is expected to grow by 61% over the next three years to reach 11.6% of marketing budgets. Contributions of analytics to performance remain moderate, however. One reason for this weakness may be that only 40% of marketers report having the right quantitative tools to demonstrate the impact of marketing spend on company performance. The silver lining is this is the highest reported level of use of quantitative tools in the history of The CMO Survey.
#4—Artificial Intelligence: Marketing leaders report a 27% increase in the use of artificial intelligence and machine learning in their toolkits over 2018 levels and expect this level to increase another 60% within three years. These rates are even higher for larger companies and for companies with a larger proportion of their sales through the internet. The top uses of AI in marketing involve content personalization, predictive analytics for customer insights, and targeting decisions. The adoption of blockchain technologies in marketing is slower, with no real growth reported over 2018 levels, which were very low.
#5—Customer Experience (CX): When asked to compare their CX performance to competitors, marketers generally rate their own companies poorly on various customer experience activities. In fact, they report above average performance only on “assuring customer experiences are compatible with the brand” while eleven other key strategic CX activities are rated on par with or below the competition. Combining their top challenges and weak competitive performance, the biggest opportunities for CX improvement appear to lie in: (1) “Developing the necessary capabilities to design, deliver, and monitor the customer experience” and (2) “Integrating touchpoints seamlessly across the entire customer journey.”
#6—Marketing and Societal Metrics: Societal metrics measuring the degree to which marketing benefits society and the impact of marketing on the ecological environment show no gains over an 8-year period. This is surprising given the pressure that customers and other stakeholders are placing on companies to create this type of value. Where is the resistance and how can companies move forward to make gains in these important areas? It might be worth studying the Education sector, which rates itself 20% above the average of other sectors on these metrics.
#7—Mobile Marketing: Spend on mobile has trended upwards over the past five years from 3.2% of marketing budgets to 12.8% this summer. This level is expected to continue to rise—growing 71% over the next five years—to a whopping 21.8%.
#8—Customer Priorities: Customers are expected to prioritize excellent service and superior product quality in 2020. Marketers expect customers to place a stronger emphasis on excellent service (28% increase) and superior product quality (12% increase), while pressures for low price have dropped by 17% since the last Survey.
#9—Marketing Organization: Although companies continue to build new marketing capabilities by training current employees or hiring new employees with needed skills (53.8% of firms), this number has decreased from 59.8% in August 2018. Partnering with agencies and consultancies to build new capabilities has, in turn, risen.
#10—Marketing Jobs and New Technologies: Planned marketing hiring rose with a 6.2% change in marketing hires planned in the next twelve months. B2C Services companies expect to hire the most at 8.6%. In response to the question, “To what extent are new technologies replacing marketing employees?” 57.6% reported not at all currently, but this number is expected to drop to 37.5% in the next three years. B2C Services companies report the most replacement.
A complete set of results can be found at https://cmosurvey.org/results/. I will offer a deeper dive on these results over the next 6 months, so stay tuned for more analysis and recommendations. To sign up for the next CMO Survey, visit https://cmosurvey.org/participate/.
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