Marketing in the New Age

The Marketing function has transformed drastically over the past decade. It is no longer centered on just marketing communications, outdoor marketing and brand creation/management. In today’s world, it is also equally about devising a seamless GTM strategy for digital and physical channels along with marketing technology (mar-tech) innovation through partnerships & acquisitions. New products and platforms have been developed by organizations such as Adobe and Optimizely to provide account and individual-based content. The recent spate of AI-based start-ups (Kaggle, Ozlo) acquired by media giants such as Google, Amazon and Facebook in the AI space has indicated an increased investment towards user acquisition, consumer behavior, customer experience and price analytics.

So, where is the spend shifting to? Although the spend on marketing as a percentage of revenue has increased, organizations now want better returns for every dollar of marketing spend. More than 60% of enterprise CMOs today hold a P&L mandate. However, after three consecutive years of increases, marketing budget growth stalled in 2017-2018. Budgets slipped from a peak of 12.1% of company revenue in 2016 to 11.3% in 2017, according to the Gartner CMO Spend Survey 2017-2018.² While CMO budget allocation to mar-tech services has declined by five percentage points (the current mar-tech spend is 22% of CMO budget), there has been an increase in share of paid media and services by six percentage points.³

What about CMO’s role definition itself? Nearly one-third of all organizations surveyed say at least some aspects of sales, IT and customer experience report to the CMO¹. The CMO office has diversified from being a function solely driven by creativity and physical channel management to a complex organization which involves product management, corporate marketing, mar-tech and IT across physical and digital channels.

Has this impacted the broader marketing organization too? Yes, marketing organizations now demand hybrid skills: an in-depth understanding of branding, marketing and messaging, as well as technical skills like build, rollout and support for Analytics applications, CMS systems and digital marketing suites. The product manager who is the central player in the CMO organization is required to wear many hats, needing to be at minimum a marketing guru, a creative genius, and a technology savant while being an influential communicator.

Is CMO’s office becoming more technology-heavy? Critical marketing-related decisions are now left in the hands of technologists who may not have enough domain knowledge to create an effective GTM strategy. Digital decoupling as a concept has thus gained ground. While some functions remain in-house; aspects of creative marketing, brand communication strategy, demand generation, video, mobile and digital marketing could be outsourced to media/advertising agencies, which specialize in these areas. Creation and maintenance of technology tools could also be outsourced to firms, who are experts in a particular technology and/or domain thus making the marketing organization lean.

So, what is the way forward for the CMO organization? Growth of multiple online channels, increased ROI expectations, diverse skillset requirements and availability of SaaS-based platforms & technologies would continue to impact industry dynamics. Marketing organizations should look to hire for core marketing roles and outsource creative and support functions including IT to specialists. As organizations experiment with outsourcing models and seek out partners with right fit in technology, skills and offering, we see marketing-as-a service increasingly becoming the preferred model.

References:

https://www.cio.com/article/3140266/cmo-role/cmos-will-outspend-cios-on-technology-in-2017.html
Gartner, Smarter with Gartner, 2017-2018 CMO Spend Survey Highlights Demand for Results, November 20, 2017 https://www.gartner.com/smarterwithgartner/2017-2018-cmo-spend-survey-highlights-demand-for-results/
http://www.marketingjournal.org/3-big-ideas-from-amazon-and-the-implications-for-marketing-frank-grillo/

About the Author

Srini Pallia

Srini is President and Global Head of Wipro’s Consumer Business Unit which serves customers in a range of consumer-focused industries including Retail, CPG, New Age, Media, Entertainment, Travel, Transportation, Hospitality and Public Sector. He is responsible for setting the vision as well as shaping and implementing growth strategies for each of these industry verticals.

He is a member of Wipro’s Group Executive Council & Wipro’s Inclusion and Diversity Council. Srini has been with Wipro for over 28 years in various leadership roles – establishing, scaling and spearheading growth across Business Units, Service Lines and Markets. In his previous role Srini was Sr. Vice President and Global Head of Business Application Services, and prior to that he was Vice President and head for Enterprise Business in North America.

He was rated among the top 25 Young Business Executives in India by Business Today in 2008. He has received several accolades for his contributions to Wipro’s growth and customer success. Srini holds a Master’s degree in Management Studies from Indian Institute of Science, Bangalore and a Bachelor’s degree in Engineering. He has undergone Leading Global Business Executive program from Harvard Business School and an Advanced Leadership Program from McGill Executive Institute.

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