Posts Tagged 'CMO priorities'

Nick Utton of E-Trade on client/agency relationships

The “Socratic Discussion” panel of agency and client executives was, to me, one of the real high points of Advertising Week.

Here is a link to E-Trade’s CMO, Nick Utton, responding to Susan Giannino’s challenge that CMOs seem to be losing their influence inside companies.

The whole segment is worth watching.  He is very insightful on the need for clients to bring in experts, for clients to be actively looking for the experts instead of waiting for their agencies to bring them.  And very funny, too!

Coca-Cola and BMW on reinventing marketing

Yesterday’s panel moderated by Stuart Elliott was particularly good.

If there is one thing to take away from that panel, if there is one priceless thing, it is the need for Client to take control of their branding and for them to orchestrate of all the agencies themselves.  That means the client needs to have an internal structure and resources.  They need to reinvent marketing.  They need to develop models of marketing unlike anything that ever existed before.

And it means that each agency must play well with the others.  They must collaborate and cooperate and be transparent.

As the communications landscape becomes more complex and new technologies mix up the world faster than anyone can strategically comprehend. No single agency can possibly serve the needs of an advertiser. They rely on 5,6 or 7 different agencies, buying a la carte. The CMO needs to know many disciplines since they now have to integrate the various silos.

Pio Schunkur, SVP of Integrated Marketing at Coca-Cola, made the following observations.  These are almost all direct quotes:

“Marketing today is non-linear.  How do we really begin to understand that and to structure around it?”  Clients have to knit it together themselves.

“No one agency can do it all for us.  So we have to create an infrastructure in-house, a center of expertise in-house to create and manage the expression of our brand.  We are not replacing agencies… We use agencies a la carte”

“The structure of the marketing group impacts the strategy.”

In response to a question from Stuart Elliott about how Coca-Cola deals with so many different processes from so many different agencies, Pio responded, “The agencies need to be controlled from our side.”

“Every good brand is about story telling.  The difference is that we are now telling the story in different places.”

The group responsible for began several years ago and one of their major challenges was to push the agencies to collaborate.

Patrick McKenna of BMW had many similar observations.

[Between CRM, PR, advertising, mobile] we have to work with 5 to 6 different agencies.  We want the agencies to work together and to integrate.  All parties need to work together.”

“Each car launch is a cross-collaborative process.  The agency partners put the ideas together.”  The agencies are expected to work together to develop and vet ideas before presenting to BMW.

“Sometimes the role of the client is to be the referee.  Clients have to referee between two agencies to make sure that a great idea lives on.”  So there are times when BMW has to force the issue but that is not often.”

From the media side, we heard Greg Coleman of The Huffington Post observe the way agencies are blurring their roles and trying to stay in the game. “We are seeing PR agencies getting into the branding area.  We need clients to be the referee.”

Of course Elliott’s sense of humor and skepticism is never far below the surface.  When McKenna said that advertising is storytelling, Stuart Elliott responded, “Fairy tales.”

If the economy has a double-dip recession, what happens to marketing?

The economic forecasts for the remainder of 2010 and into 2011 are not very promising for many parts of the world.  They range from modest expectations of a recovery in 2011(Ben Bernanke) to deflation/stagnation (Paul Krugman).  Today’s New York Times week in review has a couple of articles that cover the range of options, including an op-ed by Laura Tyson.

In fact, some economists say we’ve never had a real recovery, that we’ve never woken up from The Great Recession.

So what does this mean for marketing?

I am predicting that marketing will not see the same kind budget slash and burn as we saw in 2008 and 2009.  Cutting marketing goes right to the bottom line.  Nearly impossible to resist that kind of pressure in a tumbling economy.  In 2009 it was irresistible.  But this time around it will be different.

This time around a lot of companies have learned the hard lesson that even in a declining economy there are winners and losers.  It was a prediction that I made in 2008 and 2009. The evidence is in:  Look what happened in the restaurant industry where McDonald’s surged ahead.  Look at the electronics industry where Samsung surged ahead.  Look at the automotive industry where Hyundai, Subaru and Kia all surged ahead.  Ed Lebar at Brand Asset Valuator has confirmed this on a global basis, and reported it in a March presentation to the NYAMA.

This time around there are companies who will take advantage of a downturn by holding steady their marketing or even increasing it.

These are strong reasons to believe that the free-fall in marketing will not repeat itself.

In the plunge or free fall that started in 2008, marketing for virtually all companies was slashed.  Budgets were drastically cut or, in the worse cases, simply frozen and spending eliminated for all but the most critical projects and programs.  At the time we conducted a survey with Forrester on the state of marketing among CMOs and Marketing Directors.  The results were dramatic.

The findings of our study were published  in the magazine of the ANA (Association of National Advertisers), AdWeek, BrandWeek, Marketing News and other industry magazines and online.

ANA_TheAdvertiserMagazine_May2009

Ringer BrandWeek_Dec2008

Ringer in Adweek

In our follow-up, which we conducted this year, we are clearly seeing winners and losers have emerged.  At the same time, the pressure on marketing has hardly eased.  In 2008, 89% of CMOs said marketing was under greater executive scrutiny that ever.  That number only dropped to 80% in 2010!

My next post will examine the effects of The Great Recession on consumer attitudes.  When the economy returns, will consumers resume old habits?  Or is this a fundamental turning point, a sea-change in attitudes that will last a decade or longer?

Clients not turning to agencies for Integrated Marcoms

More evidence that the advertising industry continues to need reinvention.  On many key measures CMOs are finding their needs are not being met by their agencies.

Some of those measures from our CMO study this year:

Only 12% of corporate marketers say they are looking for a single agency to handle all of their needs.

Only 14% are confident that they are getting the best work out of their agencies.

Finally, only 5% rate their advertising agencies as “excellent” overall.   Another 50% say “good” and 33% say “fair”.

CMOs need to rebuild their brands in 2010

Here it is, the trends reports on CMO attitudes about branding, advertising and marketing!

CMOStudy_Trends_040810

CMO study update

Another finding from our new CMO study.

The economic turmoil and cut-backs in marketing last year are showing up as a significant decrease in the strength of marketing communications and brand.  There has been a jump in the number of marketers who are making rebuilding their brand image a priority for 2010.

There has been no change in number of marketers who are looking for breakthrough methods to replace the traditional brand positioning.  That is because the majority of marketers surveyed view the traditional brand positioning approach as losing effectiveness.

Next week we expect to release a trend report comparing 2010 to 2009 data, showing how marketers are changing and adapting to evolving market needs.

Trends in marketing, Part 2

Some more insight from our new CMO study into marketing tools and techniques.  We surveyed 130 CMOs and marketing decision makers about marketing methods, tools and techniques.  In this post and some earlier posts I have been sharing topline findings from the research.

I compare marketing last year to a deep freeze.  Budgets were frozen, projects were frozen, innovation was frozen.  Last year pretty much everyone was focused on retrenchment.  They need to justify marketing spend with quantifiable ROI, cutting out costs, re-organizing the marketing functions.

Our study shows that marketing is clearly thawing.  But it isn’t even.  Some companies have moved forward to take advantage of the situation.  And others are still in a deep freeze.  We are now seeing 2 distinct segments of marketers.  [A special acknowledgement to Frank Woei of Bellwether Interactive for uncovering this].

One segment is the “Evolvers”.  This group is maximizing the situation by seizing new opportunities.  They are prioritizing evolving their marketing to match evolving business strategies, and preparing for the economic upturn by improving their brand image and reputation.

The other segment is the “Re-organizers”  This group is still frozen in place. They are analyzing and re-evaluating everything, seeking that measurable ROI and cutting marketing costs everywhere possible.

In past recessions we have seen that some companies have a great resilience and come out relatively stronger than going into the recession.  We are now seeing evidence that the pattern is repeating in this recession.  Hyundai and Apple immediately come to mind as winners emerging in a changed marketplace.


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