When it comes to digital marketing, “capability” and “accountability” are the words that CMOs have been mulling over for the past 12 to 18 months. Today, they’re adding one more to the mix: “profitability.”
In a recent study conducted by Forrester Research, Forrester confirmed that multichannel consumers--those who leverage multiple devices (laptops, smart phones, iPads, you name it…) to access the Web--are often worth five to six times more than a single channel customer. States Brian Walker, a principal analyst at Forrester and author of the consultancy's March 2011 e-commerce report: “The profusion of online touchpoints [including email marketing, social media, display marketing, company Web sites, and mobile applications] means that businesses need to develop cohesive systems to support each one.”
Never has this been more important than today, when, according to Forrester, more than 50% of U.S. online adults have two or more different devices connected to the Web to access information. And yet research conducted by Leapfrog Online indicates that marketing executives are struggling to build cohesive digital programs that drive profitable results among this critical consumer base.
It’s no longer a secret that the ROI on smart digital marketing is strong. Today’s leading CMOs know they can do more, and they know the online channel is one they must pursue. They also know it’s no longer about reporting on brand awareness or leads generated alone. Digital marketing is now recognized as a true channel to drive customer acquisition, loyalty, and growth. Though CMOs are confident in the promise, they seem to be far less confident in their ability to continually deliver on it.
Part of this stems from their uncertainty about their resources’ digital IQ. In Leapfrog’s study, the barriers to a marketer engaging outside resources centers around the marketers’ confidence in their current suppliers'/agencies' capabilities, as well as with their own lack of understanding of how to choose those resources. For many, this lack of confidence leads to status-quo approaches or, worse yet, total paralysis.
This reticence makes sense given the climate of the previous three years. At the same time the digital/online marketing space came of age, many companies were cutting their way to profitability. Today, as the C-suite comes up for air and is tasked with growth objectives, they are suddenly finding themselves overwhelmingly far behind the curve--at a time when the digital space continues to grow more complex, more fragmented, and more critical than ever before.
Surely, But Slowly
As a result, CMOs are looking at their teams, unsure of whether they have the skills and structure to handle this unprecedented intersection between marketing and technology. For the past several years, they have sought a core marketing team that can do it all: set the strategic framework, deliver niche expertise to execute on the strategy, and evolve the plan to reflect a constantly moving marketplace. Add to this a new dependence on overtasked in-house IT teams to deliver on an array of back-end technology needs, and it’s clear that getting things done quickly and effectively has never been tougher for today’s marketing leaders.
While CMOs question their teams’ abilities to deliver on the expectations of online sales and marketing, companies simply cannot afford to stand still--and they’re not. According to the Society of Digital Agency's 2011 Digital Marketing Outlook (DMO) report, 72% of brand marketers said they are planning to shift funds from traditional to digital in 2011. Success, however, depends on shifting these funds to digital strategies that drive accountability, profitability, and results.
Winning marketing organizations must invest aggressively--and smartly--to build in-house capabilities and collaborate with external partners who build confidence through results. Look for ways to constantly balance internal and external resources to drive innovation, focus, and, most importantly, new customer acquisition. Look beyond traditional marketing resources that could be building new digital capabilities to firms that began as digital firms. You might find their perspectives, strengths, and goals to be different, insightful, and refreshing. Seek partners internally and externally that can understand your business and apply the right resources to drive the right customers to your brand. Most importantly, recognize that measuring results in terms of new business generated must be a prerequisite to launching a new Marketing initiative.
Without question, the balance of 2011 will bring an influx of digital marketing hires. At the same time, many CMOs recognize they are far too behind to build all capabilities internally, especially with a learning curve that is this steep and a digital channel that is constantly changing. Accountability, capability, and profitability depend on structuring quickly--and smartly--for success. Results-oriented organizations are looking to proven external partnerships to help CMOs build momentum and scale. Partners committed to the organization’s success, confident in the ability to generate customers (not leads), and willing to work to demonstrate revenue-producing outcomes will lead the way in driving true success in the digital landscape.