In a global research involving over 600 CMOs and senior marketing decision-makers, GfK has examined their perceptions of the success factors that drive effective marketing in their respective companies. These factors are categorized into three pillars: “Impact,” “Alignment,” and “Investment.”
The survey responses form the basis for GfK’s new” CMO Outlook Index”, which shows that most senior marketing leaders feel there is significant potential for improvement in their organization. It also identifies what CMOs can do to achieve marketing excellence.
The three central pillars of marketing effectiveness are: “Impact” (capability of team and demonstration of ROI), “Alignment” (leveraging the brand’s commercial value and purpose), and “Investment” (C-suite commitment to brand and marketing investment). GfK’s global study shows that there is still a lot of room for progress. While 40 percent of the senior marketers say they have all necessary resources in at least one of the areas, only seven percent say they feel optimally equipped across all three of the pillars.
“It is relatively common for CMOs to have optimized either their marketing team’s ability or their company’s brand alignment or its brand investment. The huge drop-off comes when we look at who feels optimally positioned across all three areas. The findings from our CMO Outlook Index help marketing leaders to understand how their peers perceive marketing and where growth is needed,” comments Gonzalo Garcia Villanueva, Chief Marketing Officer at GfK.
Companies where marketing leaders see strong “Alignment” have more responsibilities assigned to marketing teams
The “Alignment” pillar relates to leveraging the brand’s commercial value and purpose: A quarter of all marketing decision-makers in the survey very strongly agree that their company has a clearly defined mission and purpose beyond commercial goals, and also that the brand contributes to the company’s commercial success. In companies where the marketing leader feels they have a strong brand purpose, marketing typically has more influence: 81 percent of the marketing leaders in such companies include product development as a responsibility of Marketing (compared to 69 percent average for all respondents), and 78 percent say the same for pricing (compared to 67 percent average).
Budgeting for success: 60 percent of decision-makers in the survey prioritize long-term brand building in marketing allocations
For the “Investment” pillar, GfK looked at the balance between long-term brand building and short-term sales growth, as well as the backing of CEOs and CFOs for investing in long-term brand strategies. 19 percent of marketing leaders in the survey consider themselves to be optimally positioned in both categories. Within this group, 60 percent say they spend at least 7 in 10 of their marketing dollars on long-term brand building, compared to 52 percent of all respondents. This level of long-term investment seems high but likely captures the budget beyond immediate media and production costs.
20 percent of the decision-makers believe they are ideally positioned regarding “Impact”: They have a strong team with all necessary skills and a good understanding of which activities, channels, and marketing levers deliver the best ROI. Of these, 59 percent are extremely confident that their data, analytics, and insights systems will be able to answer the critical business questions of the future.
Index rating reveals critical differences by revenue and industry
The overall CMO Outlook Index is an average across all three pillars and takes the marketing frontrunners for each pillar into account. Looking more closely at company sizes, the index shows that marketers in companies with high annual revenues also consider themselves best positioned in terms of the success factors needed for effective marketing.
Interesting differences can also be observed across different industries: Technology and Durables as well as Financial and Professional Services companies have the highest score, each standing at 24.
Marketing Index rating overview by country
As expected, there are regional differences in outlook. The Americas exhibit a more positive perspective on marketing as a whole, closely followed by India, whereas Europe and the rest of the world have a more pessimistic view. All can agree that marketing investment makes sense – just what to invest, where, and when are key. For instance, In India, 30% of those surveyed expressed their commitment to investing in the brand, both in the short and long term.
The CMO Outlook Index will be tracked continuously, with the full report providing an even deeper analysis and recommendations being released in September. Get to know the health of marketing and its impact on business with the CMO Outlook Index.
