The CMO Challenge: Exiting the Comfort Zone

Felix Thomson

Content Executive

The Financial Services Forum

To be effective, marketers need to up their game, take on the new media, and be prepared to be adventurous, extending their influence over many of the critical business growth drivers, says Michael Dunn.
The continuing struggle that marketers face when it comes to maximizing – or even measuring – the effectiveness of marketing investments is showing no sign of abating. And that is likely keeping many marketers from advancing to the next level. In Prophet’s recently unveiled 2006/2007 Best Practices Study: “The Effectiveness Imperative,” 84% of respondents admitted that marketing return on investment (MROI) is not well understood in their businesses. As one respondent shared, “we’re still learning exactly how to measure effectiveness.”
Marketing effectiveness is an increasingly critical issue to corporate decision makers. Pressure is mounting on marketers to drive growth as evidenced by performance against business metrics – market share, sales and revenue, margin, and shareholder value. Marketers know that to meet that challenge, they must understand the optimal interplay between all kinds of marketing efforts and levers. At issue is how traditional and emerging social media tactics perform separately and against each other, and then, when factors like price variations are inserted in the mix. They must learn to better evaluate ROI of marketing spend on a more holistic basis, as well as against business measures. The 2006/2007 Best Practices Study revealed a variety of barriers to creating more effective marketing organizations and initiatives. Conducted in late 2006, it surveyed more than 100 senior marketers with businesses in the United States, United Kingdom, and Germany. Nearly half the respondents work for businesses of between $1 billion and $9.9 billion in revenues – 60% of them employ 5,000 or more employees.
Owning the four Ps – or not
The study showed that not understanding MROI isn’t the only factor that’s holding marketing back. It’s a general lack of influence over many of the critical business growth drivers that separates marketers, who own strategy in terms of marketing communications, from Marketers, whose purview extends fully into all of the four Ps.
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