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IBM Global CMO Study Finding Presentation

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The document summarizes key findings from a study of over 1,700 Chief Marketing Officers (CMOs) globally, including insights specific to ASEAN markets. Some of the main points include: 1) CMOs feel unprepared for increasing complexity, especially around data explosion, social media, and shifting consumer demographics. 2) Most CMOs rely on traditional market research over understanding individual customers. 3) CMOs recognize the need to invest in technologies and analytics to manage growing customer data and insights. However, many barriers remain around building business cases, IT alignment, and developing marketing skills. 3) CMOs signaled three priority areas for improvement: delivering value to empowered customers, fost

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Insights from the Global Chief Marketing Officer Study (ASEAN) ASEAN Point of View
IBM Institute for Business Value The 2011 Global CMO Study is part of our C-suite Study series encompassing interviews with more than 15,000 C-suite executives ’04-’05 ’06-’07 ’08-’09 ’10-’11 CEO CIO CFO CHRO CSCO CMO 2 © 2011 IBM Corporation
IBM Institute for Business Value In this largest sample of face-to-face CMO interviews, we spoke with more than 1,700 CMOs The study represents organizations in 64 countries and 19 industries Sectors Regions 3% Public 16% 17% Communications North America 21% 44% Industrial Growth markets 36% 24% Distribution 35% Financial Services Europe 4% ASEAN 4% Japan Growth Markets include Latin America, non-EU Eastern Europe, Middle East and Africa and Asia Pacific (excluding Japan); n=1734 3 © 2011 IBM Corporation
IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future “The perfect solution is to serve each consumer individually. The problem? There are 7 billion of them.” Consumer products CMO, Singapore 4 © 2011 IBM Corporation
IBM Institute for Business Value CMOs feel unprepared for the amount of complexity they face Expected level of complexity and preparedness to handle Percent of CMOs responding 79% Expect high/very high level of complexity over 5 years 48% 31% complexity Feel prepared for gap expected complexity Source: Q4 How much complexity will your organization have to master over the next 3 to 5 years compared to today? n=1709; Q6 How prepared do you feel for the expected complexity ahead? n=1712 5 © 2011 IBM Corporation
IBM Institute for Business Value Data explosion, Social Media, Growth of Channel Device Choices and Shifting Demographics present the biggest challenge for CMOs Underpreparedness Percent of CMOs reporting underpreparedness Global 50% ASEAN Data explosion 71% 56% Social media 68% 64% Channel and device choices 65% 48% Shifting consumer demographics 63% 52% Financial constraints 59% 81% Decreasing brand loyalty 57% 53% Emerging market opportunities 56% 55% ROI accountability 56% 46% Customer collaboration and influence 56% 54% Privacy considerations 55% 50% Global outsourcing 54% 57% Regulatory considerations 50% 30% Corporate transparency 47% 18% Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=4 to 46 (n = number of respondents who selected the factor as important) 6 © 2011 IBM Corporation
IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix Under- preparedness 70 60 50 Factors impacting 40 marketing 0 20 40 60 Mean 7 © 2011 IBM Corporation
IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix 1 Data explosion Under- 2 Social media preparedness 1 3 Growth of channel and device choices 70 2 4 Shifting consumer demographics 3 4 60 50 Factors impacting 40 marketing 0 20 40 60 Mean 8 © 2011 IBM Corporation
IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix 1 Data explosion Under- 2 Social media preparedness 1 3 Growth of channel and device choices 70 2 4 Shifting consumer demographics 3 5 Financial constraints 4 6 Decreasing brand loyalty 60 5 7 Growth market opportunities 6 10 7 9 8 ROI accountability 8 11 9 Customer collaboration and influence 50 12 10 Privacy considerations 13 11 Global outsourcing Factors impacting 12 Regulatory considerations 40 marketing 13 Corporate transparency 0 20 40 60 Mean 9 © 2011 IBM Corporation
IBM Institute for Business Value To deal with the broad level of underpreparedness, CMOs signaled three key domains of improvement Deliver value to empowered Capture value, customers measure results Foster lasting connections “Changes do occur but not right away, in phases..” Banking SVP head marketing & brand awareness, Indonesia 10 © 2011 IBM Corporation
IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 11 © 2011 IBM Corporation
IBM Institute for Business Value Markets–not individuals–still shape CMOs' strategy Market research 82% 50% Corporate strategy 81% Competitive benchmarking 80% Customer analytics 74% Marketing team analysis 69% 7 other sources Consumer reviews 48% Third-party rankings 42% Retail and shopper analysis 41% Online communications 40% Professional journals 37% Key sources to Blogs 26% understand individuals 13 © 2011 IBM Corporation
IBM Institute for Business Value CMOs are overwhelmingly underprepared for the data explosion and recognize need to invest in and integrate technology and analytics Global Underpreparedness Percent of CMOs selecting as “Top 5 Factors” Need for change to deal with data explosion Percent of CMOs indicating high/significant need Data explosion 71% Social media 68% Invest in 73% technology Channel & device choices 65% Integrate Shifting demographics 63% 69% insights Financial constraints 59% Understand 65% Decreasing brand loyalty 57% analytics Emerging markets 56% Rethink 64% skill mix ROI accountability 56% Collaborate Customer collaboration 56% 52% with peers Privacy considerations 55% Validate 49% Global outsourcing 54% ROI Regulatory considerations 50% Address 28% privacy Corporate transparency 47% Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=149 to 1141; Q20 To what extent will the opportunity to collect unprecedented amounts of data require you to change? n=1629 to 1673 14 © 2011 IBM Corporation
IBM Institute for Business Value Majority of CMOs are eager to deploy tools and technologies to grapple with growing volume, velocity and variety of data Plans to increase the use of technology Percent of CMOs selecting technologies Global ASEAN Social media 82% 83% Customer analytics 81% 93% CRM 81% 89% Mobile applications 80% 85% Content management 73% 82% Tablet applications 72% 70% Single view of customer 70% 80% Collaboration tools 68% 80% Predictive analytics 66% 82% Reputation management 63% 72% Search engine optimization 62% 70% Campaign management 61% 74% Score cards/dashboards 56% 79% E-mail marketing 46% 49% Source: Q22 Do you plan to decrease or increase the use of the following technologies over the next 3 to 5 years? n=1616 to 1671 15 © 2011 IBM Corporation
IBM Institute for Business Value What’s inhibiting them? Building the business case, IT-marketing alignment/integration issues and marketing technology skills ASEAN Barriers to using technology in marketing Top 5 selected by CMOs Lack of marketing and IT alignment 66% Cost 63% Lack of ROI certainty 61% Lack of IT integration with organization 61% Lack of skills of (potential) users 50% Lack of technological ownership in marketing 40% Business case Tool implementation issues 36% IT related Lack of IT Skills 30% Marketing related Reliability 23% IT and marketing related Ease of use 20% Usability Source: Q23 What are the top 5 barriers to using technology? n=70 16 © 2011 IBM Corporation
IBM Institute for Business Value Recommendations and tough questions – Deliver value to empowered customers Begin with the big business question. How are you gearing your marketing Focus on the opportunity to create value people, programs and processes to for customers as individuals. understand individuals not just markets? Open the aperture. Reprioritize your investments to mine digital channels, such as blogs, tweets, social networks, peer reviews and Which tools and processes are you consumer-generated content, to access investing in to better understand and customers’ honest, unmediated views, respond to what individual customers values and expectations. Use advanced are saying and doing? analytics to recognize preferences, trends and patterns across every touch point. Safeguard data. Work with IT to assess potential data and How do you safeguard your customers' infrastructure exposures, employ tools to data and privacy in a multi-channel, secure customer data and update privacy multi-device world? policies to address customers’ concerns. 18 © 2011 IBM Corporation
IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 19 © 2011 IBM Corporation
IBM Institute for Business Value Enhancing customer loyalty is the top digital priority ASEAN Enhance customer loyalty/advocacy 67% 83% Deploy tablet/mobile apps 57% 70% Use social media to engage customers 56% 49% Use customer management software 56% 80% Monitor the brand via social media 51% 80% Measure ROI of digital technologies 47% 82% Analyze online/offline transactions 45% 72% Develop social media policies 37% 70% Monetize social media 29% 74% Increase supply chain visibility 24% 79% © 2011 IBM Corporation
IBM Institute for Business Value CMOs still focused on transactions, not relationships ASEAN Segmentation/targeting 61% 70% Awareness/education 46% 58% Interest/desire 45% 59% Action/buy 54% 59% Use/enjoy 41% 52% Bond/advocate 40% 41% Transaction focused Relationship focused 22 © 2011 IBM Corporation
IBM Institute for Business Value CMOs still focused on transactions, not relationships Segmentation/targeting 61% Awareness/education 46% Interest/desire 45% Action/buy 54% Missed opportunity Use/enjoy 41% Bond/advocate 40% Transaction focused Relationship focused 23 © 2011 IBM Corporation
IBM Institute for Business Value Customers have clear expectations based on the corporate character, yet employees are not fully on board ASEAN Is your corporate character understood in the marketplace? 25% 43% say no or limited say understood and understanding of (strong) contributor to corporate character brand success 4% 21% 32% 23% 20% Not understood Strong contributor to the brand’s success Is much more work needed to get employees on board? 64% 16% say no or very say significant or limited work much work needed needed 28% 36% 20% 13% 3% Significant work needed No work needed Source: Q10 Is your corporate character understood in the marketplace? n=70; Q11 How much work is needed to have employees embrace and live the corporate character? n=70 24 © 2011 IBM Corporation
IBM Institute for Business Value Practicing corporate transparency helps organizations improve customer engagement and use customer data in an insightful way ASEAN Top 5 initiatives driven by transparency Percent of CMOs selecting initiatives 50% Enhance engagement with customers and citizens 81% Expand data collection, analysis and insights capabilities 81% Manage brand reputation within and beyond the company 78% Define and Activate Corporate Character 72% Orchestrate a single view of the brand 65% Source: Q9 To what extent does transparency create a need for you to: n=66 to 68 25 © 2011 IBM Corporation
IBM Institute for Business Value Recommendations and tough questions – Foster lasting connections Jumpstart relationships. Capitalize on new digital channels to How do your marketing tactics and stimulate conversations with existing and investments work in sync to create and potential customers, and create new grow a pervasive and innovative total types of relationships to reveal untapped customer relationship? opportunities. Use tangible incentives to attract followers. Connect continuously. What steps are you taking to connect Engage with your customers and citizens customer insights with product and at every stage in the customer lifecycle, service development, and stimulate and build online and offline communities your customers to become brand or to strengthen your brand. company advocates? Champion your organization’s corporate character. How are you collaborating with your Help the enterprise define and activate the C-level peers to activate your traits that make it unique. Work with the “corporate character” across all touch entire C-suite to meld the internal and points and experiences? external faces of the enterprise. 26 © 2011 IBM Corporation
IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 27 © 2011 IBM Corporation
IBM Institute for Business Value By 2015, ROI will be the leading measure of success ASEAN Marketing ROI 63% 59% Customer experience 58% 56% Conversion rate/new customers 48% 54% Overall sales 45% 51% Marketing-influenced sales 42% 51% Revenue per customer 42% 40% Social media metrics 38% 37% 28 © 2011 IBM Corporation
IBM Institute for Business Value CMOs should exert significant influence across four Ps, not just promotion, for organizational success ASEAN Percent of CMOs citing significant influence Integrated advertising and promotion 85% Promotion Aligned internal and external communications 87% Innovative social and other emerging media 70% Deeply researching customer needs 70% Products Product service portfolio 64% Comprehensive research and development cycle 64% Customer experience involving multiple touch points 65% Place Channel selection and management 52% End-to-end supply chain process 52% Full competitive pricing assessment 65% Price Understanding of total ownership costs/benefits 62% Integrated, cross-company pricing process 52% Source: Q14 How much influence do you and your organization have over the “Four Ps” and their related sub-factors? n=63 to 67 30 © 2011 IBM Corporation
IBM Institute for Business Value To gain influence, CMOs need to introduce new skills into marketing's mix; many plan to tap external expertise CMOs’ use of external partnerships Global ASEAN Sales /lead management 7% 100% 300% Customer and data analytics 12% 92% 90% Direct/relationship marketing 13% 77% 146% IT skills 23% 61% 35% Call and service center 22% 59% 218% Tracking/measurement 13% 54% 156% Event management 28% 50% 53% Online communities 22% 50% 64% Percent of CMOs using partners extensively today Percent increase of partnerships in 3-5 years Source: Q16 What do you do within marketing and what resources will you tap into, to manage marketing today and going forward? (in 3 to 5 years) n (Today) = 1440 to 1668 n (in 3-5 years) = 1481 to 1636 31 © 2011 IBM Corporation
IBM Institute for Business Value Recommendations and tough questions – Capture value, measure results Capitalize on new tools to measure How are you measuring and what matters. analyzing the results of your Use advanced analytics and initiatives and communicating them compelling metrics to improve to advance your marketing function’s decision making and to demonstrate credibility and accountability? your accountability. Enhance business acumen. What are you doing to enrich the Adjust your talent mix to increase skills mix in the marketing function technical and financial skills, and grow and build technical, financial and your digital expertise by finding new digital acumen? partners to supplement your in-house resources. Lead by example. In what ways are you personally Expand your horizons by enhancing your investing to broaden your capabilities? personal financial, technical and digital savviness. 32 © 2011 IBM Corporation
IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future “Marketing is a balanced combination of art and science. A good approach blends human creativity and logical thinking based on the data insights technology offers.” Consumer products marketing director, Vietnam 33 © 2011 IBM Corporation
IBM Institute for Business Value In addition to strategic actions, there are three initiatives CMOs can start today to become better prepared for the digital era Create small action teams 1 Establish a short-term task force for each imperative to develop recommendations for improvements Invite eager marketing futurists from your organization to participate Break challenges in chunks to address the big picture, details and dependencies Identify opportunities for small wins and boost support for more radical initiatives Schedule time with your C-suite peers 2 Be proactive with collaboration CIO: Discuss improvements for marketing technologies and tools CFO: Explore financial implications and accountability CHRO: Consider how to empower employees to better represent your corporate character Engage like a customer 3 Live your customers’ experience with your brand. What does it feel like to be a segment of “one”? Drop in on stores and sites Visit your call center, sit in with representatives, or remotely access randomly recorded calls Join the customer conversation via social media 34 © 2011 IBM Corporation
IBM Institute for Business Value Moving from Stretched to Strengthened Deliver value to Foster lasting Capture value, empowered customers connections measure results Focus on creating value for Capitalize on new digital Use advanced analytics and customers as individuals channels to stimulate customer compelling metrics to improve conversations and new decision making and to Reprioritize investments to relationships; use tangible demonstrate accountability mine digital channels to access incentives to attract followers customers’ views and use Adjust your talent mix to advanced analytics to Engage with customers increase technical and financial recognize preferences and throughout the customer skills, and grow digital expertise trends across every touch point lifecycle; build online/offline by finding new partners to communities to strengthen supplement in-house resources Work with IT to assess your brand potential data and infrastructure Expand your horizons by exposures, employ tools to Help the enterprise define and enhancing your personal secure customer data and activate traits that make it financial, technical and update privacy policies to unique and engage the C-suite digital savviness address customers’ concerns to meld the internal and external faces of the enterprise 35 © 2011 IBM Corporation
Appendix © 2011 IBM Corporation
IBM Institute for Business Value Through these in-depth discussions, we are better able to understand the evolving role and function of the CMO in the C-suite Global Scope Approach Analysis Sample consists of private sector Face-to-face one hour Statistical analysis of 35 CMOs (97%) and public sector interviews with 1,734 CMOs questions and the related 236 leaders (3%) discrete factors Facilitated using structured Representative sample across questionnaire In-depth analysis based on 64 nations and 19 industries self-reported performance Wide coverage: from highly characteristics for differences Private sector organizations profiled organizations (48 of between “outperformers” and with revenue more than US$500 the 100 top Interbrand “underperformers” million in mature markets and organizations) to lower profile more than US$250 million in local organizations Comprehensive review and growth markets; public sector analysis of more than 10,000 organizations with more than interview quotes 1,000 employees Marketing in the Digital Era Deliver value to empowered customers Foster lasting connections Capture value, measure results Note: Outperformers and underperformers were identified by answers to questions about their organization’s competitive position. Those who selected “significantly outperform industry peers” were identified as outperformers; those who selected “somewhat or significantly underperform industry peers” were grouped as underperformers. 37 © 2011 IBM Corporation
IBM Institute for Business Value CMOs: swimming, treading water or drowning? In this digital era... CMOs have to... Globalization has brought the world to Do more than ever, inside and outside everyone’s backyard the organization Everyone is a broadcaster, publisher and Be more accountable for return on a critic: there is nowhere to hide investment (ROI) Transparency is the new price of entry Use tools and technologies that their children understand better than they do And... And... more data, more sources, CMOs have just three to four years less clarity to make their mark “Fairly significant change across all areas is needed.” Consumer products SVP marketing operations, Asia, Africa, Central & Eastern Europe, Singapore 38 © 2011 IBM Corporation
IBM Institute for Business Value ASEAN CMO Study key findings ASEAN CMOs underline the importance of getting closer to customer and being focused on improving customer experience to be successful in the future Understanding the market and competition ranks as one of their other key priorities ASEAN CMOs are focused on using social media as a key engagement channel, leveraging data analytics and on improving tools and methods to calculate the ROI of Marketing activities Promotion heavily outnumbers all other influencing factors The majority of the CMOs expressed their unpreparedness on account of financial constraints, and the lack of alignment of marketing and IT in their organisation 39 © 2011 IBM Corporation
IBM Institute for Business Value CMOs also can expand their personal influence by shifting to new capabilities that focus on technology, social media and ROI Capabilities for personal success over next 3-5 years Percent of CMOs selecting capabilities Global ASEAN Leadership abilities 65% 56% Voice of the customer insights 63% 61% Creative thinking 60% 47% Cross-CxO collaboration 49% 31% Competitive trends insights 45% 47% Analytics aptitude 45% 41% Management capabilities 31% 37% Understanding products/services value chain 30% 26% Demand creation capabilities 30% 39% Technology savviness 28% 39% Social media expertise 25% 29% Finance skills 16% 23% Source: Q17 What capabilities do you need to be personally successful over the next 3 to 5 years? n=1733 40 © 2011 IBM Corporation

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IBM Global CMO Study Finding Presentation

  • 1. Insights from the Global Chief Marketing Officer Study (ASEAN) ASEAN Point of View
  • 2. IBM Institute for Business Value The 2011 Global CMO Study is part of our C-suite Study series encompassing interviews with more than 15,000 C-suite executives ’04-’05 ’06-’07 ’08-’09 ’10-’11 CEO CIO CFO CHRO CSCO CMO 2 © 2011 IBM Corporation
  • 3. IBM Institute for Business Value In this largest sample of face-to-face CMO interviews, we spoke with more than 1,700 CMOs The study represents organizations in 64 countries and 19 industries Sectors Regions 3% Public 16% 17% Communications North America 21% 44% Industrial Growth markets 36% 24% Distribution 35% Financial Services Europe 4% ASEAN 4% Japan Growth Markets include Latin America, non-EU Eastern Europe, Middle East and Africa and Asia Pacific (excluding Japan); n=1734 3 © 2011 IBM Corporation
  • 4. IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future “The perfect solution is to serve each consumer individually. The problem? There are 7 billion of them.” Consumer products CMO, Singapore 4 © 2011 IBM Corporation
  • 5. IBM Institute for Business Value CMOs feel unprepared for the amount of complexity they face Expected level of complexity and preparedness to handle Percent of CMOs responding 79% Expect high/very high level of complexity over 5 years 48% 31% complexity Feel prepared for gap expected complexity Source: Q4 How much complexity will your organization have to master over the next 3 to 5 years compared to today? n=1709; Q6 How prepared do you feel for the expected complexity ahead? n=1712 5 © 2011 IBM Corporation
  • 6. IBM Institute for Business Value Data explosion, Social Media, Growth of Channel Device Choices and Shifting Demographics present the biggest challenge for CMOs Underpreparedness Percent of CMOs reporting underpreparedness Global 50% ASEAN Data explosion 71% 56% Social media 68% 64% Channel and device choices 65% 48% Shifting consumer demographics 63% 52% Financial constraints 59% 81% Decreasing brand loyalty 57% 53% Emerging market opportunities 56% 55% ROI accountability 56% 46% Customer collaboration and influence 56% 54% Privacy considerations 55% 50% Global outsourcing 54% 57% Regulatory considerations 50% 30% Corporate transparency 47% 18% Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=4 to 46 (n = number of respondents who selected the factor as important) 6 © 2011 IBM Corporation
  • 7. IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix Under- preparedness 70 60 50 Factors impacting 40 marketing 0 20 40 60 Mean 7 © 2011 IBM Corporation
  • 8. IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix 1 Data explosion Under- 2 Social media preparedness 1 3 Growth of channel and device choices 70 2 4 Shifting consumer demographics 3 4 60 50 Factors impacting 40 marketing 0 20 40 60 Mean 8 © 2011 IBM Corporation
  • 9. IBM Institute for Business Value … particularly those with the biggest impact Marketing Priority Matrix 1 Data explosion Under- 2 Social media preparedness 1 3 Growth of channel and device choices 70 2 4 Shifting consumer demographics 3 5 Financial constraints 4 6 Decreasing brand loyalty 60 5 7 Growth market opportunities 6 10 7 9 8 ROI accountability 8 11 9 Customer collaboration and influence 50 12 10 Privacy considerations 13 11 Global outsourcing Factors impacting 12 Regulatory considerations 40 marketing 13 Corporate transparency 0 20 40 60 Mean 9 © 2011 IBM Corporation
  • 10. IBM Institute for Business Value To deal with the broad level of underpreparedness, CMOs signaled three key domains of improvement Deliver value to empowered Capture value, customers measure results Foster lasting connections “Changes do occur but not right away, in phases..” Banking SVP head marketing & brand awareness, Indonesia 10 © 2011 IBM Corporation
  • 11. IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 11 © 2011 IBM Corporation
  • 12. IBM Institute for Business Value Markets–not individuals–still shape CMOs' strategy Market research 82% 50% Corporate strategy 81% Competitive benchmarking 80% Customer analytics 74% Marketing team analysis 69% 7 other sources Consumer reviews 48% Third-party rankings 42% Retail and shopper analysis 41% Online communications 40% Professional journals 37% Key sources to Blogs 26% understand individuals 13 © 2011 IBM Corporation
  • 13. IBM Institute for Business Value CMOs are overwhelmingly underprepared for the data explosion and recognize need to invest in and integrate technology and analytics Global Underpreparedness Percent of CMOs selecting as “Top 5 Factors” Need for change to deal with data explosion Percent of CMOs indicating high/significant need Data explosion 71% Social media 68% Invest in 73% technology Channel & device choices 65% Integrate Shifting demographics 63% 69% insights Financial constraints 59% Understand 65% Decreasing brand loyalty 57% analytics Emerging markets 56% Rethink 64% skill mix ROI accountability 56% Collaborate Customer collaboration 56% 52% with peers Privacy considerations 55% Validate 49% Global outsourcing 54% ROI Regulatory considerations 50% Address 28% privacy Corporate transparency 47% Source: Q8 How prepared are you to manage the impact of the top 5 market factors that will have the most impact on your marketing organization over the next 3 to 5 years? n=149 to 1141; Q20 To what extent will the opportunity to collect unprecedented amounts of data require you to change? n=1629 to 1673 14 © 2011 IBM Corporation
  • 14. IBM Institute for Business Value Majority of CMOs are eager to deploy tools and technologies to grapple with growing volume, velocity and variety of data Plans to increase the use of technology Percent of CMOs selecting technologies Global ASEAN Social media 82% 83% Customer analytics 81% 93% CRM 81% 89% Mobile applications 80% 85% Content management 73% 82% Tablet applications 72% 70% Single view of customer 70% 80% Collaboration tools 68% 80% Predictive analytics 66% 82% Reputation management 63% 72% Search engine optimization 62% 70% Campaign management 61% 74% Score cards/dashboards 56% 79% E-mail marketing 46% 49% Source: Q22 Do you plan to decrease or increase the use of the following technologies over the next 3 to 5 years? n=1616 to 1671 15 © 2011 IBM Corporation
  • 15. IBM Institute for Business Value What’s inhibiting them? Building the business case, IT-marketing alignment/integration issues and marketing technology skills ASEAN Barriers to using technology in marketing Top 5 selected by CMOs Lack of marketing and IT alignment 66% Cost 63% Lack of ROI certainty 61% Lack of IT integration with organization 61% Lack of skills of (potential) users 50% Lack of technological ownership in marketing 40% Business case Tool implementation issues 36% IT related Lack of IT Skills 30% Marketing related Reliability 23% IT and marketing related Ease of use 20% Usability Source: Q23 What are the top 5 barriers to using technology? n=70 16 © 2011 IBM Corporation
  • 16. IBM Institute for Business Value Recommendations and tough questions – Deliver value to empowered customers Begin with the big business question. How are you gearing your marketing Focus on the opportunity to create value people, programs and processes to for customers as individuals. understand individuals not just markets? Open the aperture. Reprioritize your investments to mine digital channels, such as blogs, tweets, social networks, peer reviews and Which tools and processes are you consumer-generated content, to access investing in to better understand and customers’ honest, unmediated views, respond to what individual customers values and expectations. Use advanced are saying and doing? analytics to recognize preferences, trends and patterns across every touch point. Safeguard data. Work with IT to assess potential data and How do you safeguard your customers' infrastructure exposures, employ tools to data and privacy in a multi-channel, secure customer data and update privacy multi-device world? policies to address customers’ concerns. 18 © 2011 IBM Corporation
  • 17. IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 19 © 2011 IBM Corporation
  • 18. IBM Institute for Business Value Enhancing customer loyalty is the top digital priority ASEAN Enhance customer loyalty/advocacy 67% 83% Deploy tablet/mobile apps 57% 70% Use social media to engage customers 56% 49% Use customer management software 56% 80% Monitor the brand via social media 51% 80% Measure ROI of digital technologies 47% 82% Analyze online/offline transactions 45% 72% Develop social media policies 37% 70% Monetize social media 29% 74% Increase supply chain visibility 24% 79% © 2011 IBM Corporation
  • 19. IBM Institute for Business Value CMOs still focused on transactions, not relationships ASEAN Segmentation/targeting 61% 70% Awareness/education 46% 58% Interest/desire 45% 59% Action/buy 54% 59% Use/enjoy 41% 52% Bond/advocate 40% 41% Transaction focused Relationship focused 22 © 2011 IBM Corporation
  • 20. IBM Institute for Business Value CMOs still focused on transactions, not relationships Segmentation/targeting 61% Awareness/education 46% Interest/desire 45% Action/buy 54% Missed opportunity Use/enjoy 41% Bond/advocate 40% Transaction focused Relationship focused 23 © 2011 IBM Corporation
  • 21. IBM Institute for Business Value Customers have clear expectations based on the corporate character, yet employees are not fully on board ASEAN Is your corporate character understood in the marketplace? 25% 43% say no or limited say understood and understanding of (strong) contributor to corporate character brand success 4% 21% 32% 23% 20% Not understood Strong contributor to the brand’s success Is much more work needed to get employees on board? 64% 16% say no or very say significant or limited work much work needed needed 28% 36% 20% 13% 3% Significant work needed No work needed Source: Q10 Is your corporate character understood in the marketplace? n=70; Q11 How much work is needed to have employees embrace and live the corporate character? n=70 24 © 2011 IBM Corporation
  • 22. IBM Institute for Business Value Practicing corporate transparency helps organizations improve customer engagement and use customer data in an insightful way ASEAN Top 5 initiatives driven by transparency Percent of CMOs selecting initiatives 50% Enhance engagement with customers and citizens 81% Expand data collection, analysis and insights capabilities 81% Manage brand reputation within and beyond the company 78% Define and Activate Corporate Character 72% Orchestrate a single view of the brand 65% Source: Q9 To what extent does transparency create a need for you to: n=66 to 68 25 © 2011 IBM Corporation
  • 23. IBM Institute for Business Value Recommendations and tough questions – Foster lasting connections Jumpstart relationships. Capitalize on new digital channels to How do your marketing tactics and stimulate conversations with existing and investments work in sync to create and potential customers, and create new grow a pervasive and innovative total types of relationships to reveal untapped customer relationship? opportunities. Use tangible incentives to attract followers. Connect continuously. What steps are you taking to connect Engage with your customers and citizens customer insights with product and at every stage in the customer lifecycle, service development, and stimulate and build online and offline communities your customers to become brand or to strengthen your brand. company advocates? Champion your organization’s corporate character. How are you collaborating with your Help the enterprise define and activate the C-level peers to activate your traits that make it unique. Work with the “corporate character” across all touch entire C-suite to meld the internal and points and experiences? external faces of the enterprise. 26 © 2011 IBM Corporation
  • 24. IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future 27 © 2011 IBM Corporation
  • 25. IBM Institute for Business Value By 2015, ROI will be the leading measure of success ASEAN Marketing ROI 63% 59% Customer experience 58% 56% Conversion rate/new customers 48% 54% Overall sales 45% 51% Marketing-influenced sales 42% 51% Revenue per customer 42% 40% Social media metrics 38% 37% 28 © 2011 IBM Corporation
  • 26. IBM Institute for Business Value CMOs should exert significant influence across four Ps, not just promotion, for organizational success ASEAN Percent of CMOs citing significant influence Integrated advertising and promotion 85% Promotion Aligned internal and external communications 87% Innovative social and other emerging media 70% Deeply researching customer needs 70% Products Product service portfolio 64% Comprehensive research and development cycle 64% Customer experience involving multiple touch points 65% Place Channel selection and management 52% End-to-end supply chain process 52% Full competitive pricing assessment 65% Price Understanding of total ownership costs/benefits 62% Integrated, cross-company pricing process 52% Source: Q14 How much influence do you and your organization have over the “Four Ps” and their related sub-factors? n=63 to 67 30 © 2011 IBM Corporation
  • 27. IBM Institute for Business Value To gain influence, CMOs need to introduce new skills into marketing's mix; many plan to tap external expertise CMOs’ use of external partnerships Global ASEAN Sales /lead management 7% 100% 300% Customer and data analytics 12% 92% 90% Direct/relationship marketing 13% 77% 146% IT skills 23% 61% 35% Call and service center 22% 59% 218% Tracking/measurement 13% 54% 156% Event management 28% 50% 53% Online communities 22% 50% 64% Percent of CMOs using partners extensively today Percent increase of partnerships in 3-5 years Source: Q16 What do you do within marketing and what resources will you tap into, to manage marketing today and going forward? (in 3 to 5 years) n (Today) = 1440 to 1668 n (in 3-5 years) = 1481 to 1636 31 © 2011 IBM Corporation
  • 28. IBM Institute for Business Value Recommendations and tough questions – Capture value, measure results Capitalize on new tools to measure How are you measuring and what matters. analyzing the results of your Use advanced analytics and initiatives and communicating them compelling metrics to improve to advance your marketing function’s decision making and to demonstrate credibility and accountability? your accountability. Enhance business acumen. What are you doing to enrich the Adjust your talent mix to increase skills mix in the marketing function technical and financial skills, and grow and build technical, financial and your digital expertise by finding new digital acumen? partners to supplement your in-house resources. Lead by example. In what ways are you personally Expand your horizons by enhancing your investing to broaden your capabilities? personal financial, technical and digital savviness. 32 © 2011 IBM Corporation
  • 29. IBM Institute for Business Value Agenda Introduction – Swimming, treading water or drowning? Deliver value to empowered customers – Move from market analysis to understanding individuals – Take charge of growing volume, velocity and variety of data Foster lasting connections – Focus on the relationship, not just the transaction – Invest in building your corporate character Capture value, measure results – Demonstrate accountability through ROI – Recognize shift towards new skills and capabilities The CMO Agenda – Get fit for the future “Marketing is a balanced combination of art and science. A good approach blends human creativity and logical thinking based on the data insights technology offers.” Consumer products marketing director, Vietnam 33 © 2011 IBM Corporation
  • 30. IBM Institute for Business Value In addition to strategic actions, there are three initiatives CMOs can start today to become better prepared for the digital era Create small action teams 1 Establish a short-term task force for each imperative to develop recommendations for improvements Invite eager marketing futurists from your organization to participate Break challenges in chunks to address the big picture, details and dependencies Identify opportunities for small wins and boost support for more radical initiatives Schedule time with your C-suite peers 2 Be proactive with collaboration CIO: Discuss improvements for marketing technologies and tools CFO: Explore financial implications and accountability CHRO: Consider how to empower employees to better represent your corporate character Engage like a customer 3 Live your customers’ experience with your brand. What does it feel like to be a segment of “one”? Drop in on stores and sites Visit your call center, sit in with representatives, or remotely access randomly recorded calls Join the customer conversation via social media 34 © 2011 IBM Corporation
  • 31. IBM Institute for Business Value Moving from Stretched to Strengthened Deliver value to Foster lasting Capture value, empowered customers connections measure results Focus on creating value for Capitalize on new digital Use advanced analytics and customers as individuals channels to stimulate customer compelling metrics to improve conversations and new decision making and to Reprioritize investments to relationships; use tangible demonstrate accountability mine digital channels to access incentives to attract followers customers’ views and use Adjust your talent mix to advanced analytics to Engage with customers increase technical and financial recognize preferences and throughout the customer skills, and grow digital expertise trends across every touch point lifecycle; build online/offline by finding new partners to communities to strengthen supplement in-house resources Work with IT to assess your brand potential data and infrastructure Expand your horizons by exposures, employ tools to Help the enterprise define and enhancing your personal secure customer data and activate traits that make it financial, technical and update privacy policies to unique and engage the C-suite digital savviness address customers’ concerns to meld the internal and external faces of the enterprise 35 © 2011 IBM Corporation
  • 32. Appendix © 2011 IBM Corporation
  • 33. IBM Institute for Business Value Through these in-depth discussions, we are better able to understand the evolving role and function of the CMO in the C-suite Global Scope Approach Analysis Sample consists of private sector Face-to-face one hour Statistical analysis of 35 CMOs (97%) and public sector interviews with 1,734 CMOs questions and the related 236 leaders (3%) discrete factors Facilitated using structured Representative sample across questionnaire In-depth analysis based on 64 nations and 19 industries self-reported performance Wide coverage: from highly characteristics for differences Private sector organizations profiled organizations (48 of between “outperformers” and with revenue more than US$500 the 100 top Interbrand “underperformers” million in mature markets and organizations) to lower profile more than US$250 million in local organizations Comprehensive review and growth markets; public sector analysis of more than 10,000 organizations with more than interview quotes 1,000 employees Marketing in the Digital Era Deliver value to empowered customers Foster lasting connections Capture value, measure results Note: Outperformers and underperformers were identified by answers to questions about their organization’s competitive position. Those who selected “significantly outperform industry peers” were identified as outperformers; those who selected “somewhat or significantly underperform industry peers” were grouped as underperformers. 37 © 2011 IBM Corporation
  • 34. IBM Institute for Business Value CMOs: swimming, treading water or drowning? In this digital era... CMOs have to... Globalization has brought the world to Do more than ever, inside and outside everyone’s backyard the organization Everyone is a broadcaster, publisher and Be more accountable for return on a critic: there is nowhere to hide investment (ROI) Transparency is the new price of entry Use tools and technologies that their children understand better than they do And... And... more data, more sources, CMOs have just three to four years less clarity to make their mark “Fairly significant change across all areas is needed.” Consumer products SVP marketing operations, Asia, Africa, Central & Eastern Europe, Singapore 38 © 2011 IBM Corporation
  • 35. IBM Institute for Business Value ASEAN CMO Study key findings ASEAN CMOs underline the importance of getting closer to customer and being focused on improving customer experience to be successful in the future Understanding the market and competition ranks as one of their other key priorities ASEAN CMOs are focused on using social media as a key engagement channel, leveraging data analytics and on improving tools and methods to calculate the ROI of Marketing activities Promotion heavily outnumbers all other influencing factors The majority of the CMOs expressed their unpreparedness on account of financial constraints, and the lack of alignment of marketing and IT in their organisation 39 © 2011 IBM Corporation
  • 36. IBM Institute for Business Value CMOs also can expand their personal influence by shifting to new capabilities that focus on technology, social media and ROI Capabilities for personal success over next 3-5 years Percent of CMOs selecting capabilities Global ASEAN Leadership abilities 65% 56% Voice of the customer insights 63% 61% Creative thinking 60% 47% Cross-CxO collaboration 49% 31% Competitive trends insights 45% 47% Analytics aptitude 45% 41% Management capabilities 31% 37% Understanding products/services value chain 30% 26% Demand creation capabilities 30% 39% Technology savviness 28% 39% Social media expertise 25% 29% Finance skills 16% 23% Source: Q17 What capabilities do you need to be personally successful over the next 3 to 5 years? n=1733 40 © 2011 IBM Corporation