Gartner’s annual CMO Spend Survey for 20-21 has seen the priority deck shuffled for CMOs. Hardly surprising given the current global economic climate. The survey (a barometer for marketing investment/cuts and levels of optimism amongst 430 marketing executives across North America, the UK, France and Germany) was held over the period from March to May 2020 – just as the world was shifting gears in the face of the global pandemic.
You’d think this kind of timing would have cast a lackluster pallor over the findings. Yet despite the survey emerging in the middle of a period of significant upheaval, the levels of optimism out there amongst Marketing Executives is high. “A staggering amount of CMOs expect a return to productive performance in the next 24 months,” said Gartner analyst Ewan McIntyre, Link: https://www.gartner.com/en/webinars/3986082/the-annual-cmo-spend-survey-results-2020-2021 “This optimism was pretty strong across all industries and all geographies as well.”
Such optimism is encouraging for the immediate future, but that’s not to say there isn’t an underlying uncertainty in the market - the telltale signs of which is the resurgence of Brand Strategy and Brand Investment in the mindset of Marketers. In Gartner’s CMO Spend Survey for ‘20-‘21, CMOs rank Brand Strategy as their top strategic priority (33%) just ahead of Market Analytics and Marketing Operations (29% and 28% respectively). If you turn back the clock and look at the survey’s results for the corresponding period in ‘19-’20, Brand Strategy sits way down the list. In fact, it’s never been seen to be more important than analytics, personalization or Martech, which is a good indication of its role in how organizations are now responding to the pandemic.
What does this tell us? “There’s a brand revival going on”, said Arktic Fox founder Teresa Sperti commenting on the survey results and the state of the market in ‘Juggling Now and Next’ a recent Sonar Academy webcast. Sperti believes it demonstrates clearly that building brand capability is becoming a key focus for marketing leaders, shifting teams away from short term campaign initiatives.
In climates of uncertainty, there’s a tendency for marketers to wind back their activity and get behind their brand. Gartner’s CMO Spend Survey reveals that around half of CMOs have already delivered budget cuts in 2020, with nearly a third of them canceling media spend. While activity is down, this shifts the marketing focus to the bigger brand picture. “Brand awareness and relevance in times of strife is more important than ever” said McIntyre. “We are seeing successful brands take action that is authentically connected to their brand strategy and value proposition.” Smart marketers know that keeping the volume up on Brand provides long term value and that investments they make in their brand will reap benefits when the upturn comes. It’s about maintaining a position and grabbing market share while competitors pull back.
Around the time Gartner was conducting their survey, Forbes contributor Larry Light highlighted the importance of getting behind the brand in tough economic times. ’People buy on value. It is an everyday truth: the best value wins. This is even more important in difficult times… the goal in this turbulent economy is amazing value, staggering value, extraordinary value.’ Light points to an important new component: “It is a value multiplier, and that multiplier is trust. Trust is the consumer’s belief that the brand will deliver the promised experience relative to the expected costs.” Instead of accepting trouble in troubled times, Light believes, create trouble for others, by building and nurturing the brand. “Strong brands are a trust assurance policy for the consumer.”
So Brand is back – but what else did we learn from Gartner’s CMO Spend Survey? One of the other key findings is that MarTech is also back as a priority after being somewhat on the back burner this time last year. Investment in tech as a percentage of the Marketing budget was down by around 10% in 2019 – but that doesn’t seem to have been a reflection of the importance of MarTech in general. The 2019 survey found that marketing leaders continue to view technology as an important tool for driving customer engagement. Having said that - here we are a year later and there is clear intention to up the ante. In 2020, MarTech accounted for the largest slice of Marketing Budget at 26% of spend – slightly more than what marketers are putting aside for Agency Services, Paid Media and Labor costs. That figure is likely to rise as two thirds of CMOs are bullish about Martech investments over the coming 12 months with the spend on Martech to increase year on year. This reflects a drive toward innovation, something Marketers have had some difficulties with in the past. According to Teresa Sperti, “For those marketing departments struggling with innovation, it’s important to have an intention approach, one which combines continuous improvement with big bets and mid-range ideas.” Sperti believes that you don’t need lots of big bets and mid-range plans – “Choose 1-3 to go after for the year and combine this with your continuous improvement”.
Ultimately, good Martech is about adding to the bottom line – tools like Digital Asset Management systems and Brand Management platforms are providing marketing departments with weaponry that they desperately need with reductions in team numbers and declining budgets. Not only are they helping to get more content into market quickly, they’re uniting teams with seamless integrations and workflow processes. And with almost all of us working from home right now, this outcome is invaluable.
What would we give to have a crystal ball and see what the 2021-22 CMO Spend Survey looks like? Right now there is so much uncertainty about the future and how this pandemic might shift around and impact our global reality. But the great news is that despite all that, CMOs are super positive about the next 12 months – a remarkable and admirable finding that we can all build on.