Watching the TV series Mad Men, with its pitch-perfect view of advertising and marketing execs in the 1960s, it’s easy to marvel at how dramatically the world has changed since then. But has it, really? There are still brands sinking huge budgets into full-service agency contracts, spending millions to produce and run :30 TV spots, and expecting the audience to believe whatever product claims they put out there.
But not for long. We are in the middle of an evolutionary reckoning where marketers who adapt quickly will thrive like never before. The future CMO looks a lot more like Captain Kirk than Don Draper. And that future is bright.
A recent report discussing the marketing software revolution by Ashu Garg of Foundation Capital provides a glimpse into the future of CMOs from a marketing technology, or “martech,” perspective. Garg anticipates a dramatic change over the next ten years, a period that he calls the Decade of the CMO. After at least 50 years of traditional Mad Men-style methods, he predicts a rapid shift to a technology-driven, customer-centric, content-powered approach to marketing that’s revolutionary. Anyone who’s heard me preach, knows I couldn’t agree more.
Inspired by his report, I’d like to highlight five of the biggest changes ahead for CMOs as we approach the future of marketing at warp speed.
1. Budgets will shift from services to software
According to Garg’s report, technology currently comprises 1% of the $1 trillion that’s being spent on marketing today. But as consumer behavior changes and marketing technology advances, that’s going to increase tenfold by 2025. “Marketing is now a technical discipline,” he tells us. Coupled with this Gartner report that predicts CMOs will spend more on technology than CIOs by 2017, there is no doubt the CMO of the future will be making significant technology spending decisions.
Instead of hiring full-service agencies to handle marketing, advertising and media buying (and then firing the agency and starting all over when the results are unsatisfying), I envision CMOs increasingly using technology to own and master two-way relationships with customers at scale. They will leverage cumulative customer data to build longer-term relationships as opposed to campaign-oriented planning. As they invest in software and other technology solutions to improve decision-making and campaign execution, they will be realizing the value of data as a long-term asset and repositioning themselves as peers and partners to CIOs.
2. Customer data will be ever more powerful — and accurate
In the days of Mad Men, media ratings companies like Nielsen and Arbitron came to the forefront as the sources of information about the preferences and behavior of an anonymous sampling of TV and radio audiences. Fast-forward to the 21st century, and Comscore and Google GOOGL +0.13% Analytics started doing the same thing with digital content. But whether it’s in 1955 or 2015, the limitation of this approach is the same: You can’t really tie the data back to the actual customer, nor can you tie it all together to tell cohesive customer stories.
Future CMOs are wresting the power away from third parties and owning their own technology stack, with the goal of having real-time access to anything they want to know about customer segments and the ability to unify it into one complete picture of the customer. This approach creates the potential to extend a brand’s reach and build more relevant customer relationships.
3. Word of mouth will drive fact-based honesty
Customers’ relatively new ability to broadcast their brand experiences to massive online audiences has completely changed the game when it comes to influencing buying decisions. After all, would you rather buy a product that touts itself as the most effective of its kind, or one that thousands of consumers have reviewed, testifying firsthand to its effectiveness?
Garg cites data indicating that customer word of mouth influences 50% of purchase decisions, that 1,000+ customers can generate up to ½ million conversations and that customers trust their own stories far more than they trust the stories brands tell. Consumer reviews keep brands honest. While a brand still has to provide the emotional appeal audiences want, CMOs must also deliver fact-based reasons to buy that will meet the approval of vigilante reviewers.
4. Personalized content will be delivered at scale
This is the first time in the history of marketing that CMOs can look forward to the ability to deliver the personalized experience consumers want and do it at scale. The days of hiring an agency to just create a few high-impact TV ad or print ads and blast them out to millions of people are over. Now, marketers need a mix of useful and authentic content as well as a mix of channels that will deliver personalized content wherever the customer happens to be.
Technology underpins this possibility, providing the means to bring together data from multiple sources to get an accurate view of the customer — and then to use that view to personalize experiences. Technology is also what will make it possible to increase the impact of that experience by delivering it contextually, i.e., at the right time and in the right place.
5. The CMO will gain greater responsibility and authority
In 2006, a CMO’s tenure was brief: just 23 months on average. Today, it’s nearly doubled to 45 months. That’s a testament to the growing importance of the CMO to the overall organization. Garg tells us that marketing “is already gaining influence within the C-suite,” and points to a survey indicating that more than half of CEOs today believe their current CMO could one day replace them. He also takes into account Gartner’s finding that the three tech capabilities CEOs consider most important in the near term — digital marketing, ecommerce and customer experience management — are all responsibilities of the CMO.
Along with looking ahead to an increase in regard for the office of CMO, Garg also sees an increase in opportunities for collaboration between marketing and IT as marketing becomes a more technical discipline. The opportunity for a strategic partnership between these two areas is something McKinsey commented on recently and also a topic of a previous article in this space.
It’s an exciting time to be a CMO. There’s no “school” that teaches what the CMO of the future needs to know — it requires on-the-job inventing. I can’t wait to see which future leaders step up and masterfully blend the best technology solutions with the most creative communications to deliver the most measurable ROI, resulting in best customer experiences we’ve ever had.
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