CMOs 'not ready' to build brand loyalty
While building and sustaining brand loyalty is the top concern for today's midmarket chief marketing officers (CMOs), a worrying 72% do not feel sufficiently prepared to do so effectively, according to a global study by IBM.
Some 70% of midmarket CMOs say they are concerned about 'data explosion' as they are tasked with making sense of highly complex information generated constantly from a variety of sources such as consumer blogs, tweets, mobile texts and videos.
In fact, while CMOs have to deal with an empowered consumer who is impacting brands instantly on Twitter, Facebook and other social channels, a surprising 61% of midmarket CMOs said they are struggling with how to manage the impact that social media will have on their marketing efforts.
Many CMOs today are focused primarily on understanding market segments rather than understanding individual consumers, so it is not surprising that not even half of midmarket CMOs are taking the time to understand and evaluate the impact of consumer generated reviews, blogs and third party rankings on their brands.
The proliferation of social media and mobile devices is creating a new breed of consumers who are digitally savvy and able to quickly compare and evaluate the products and services they want to buy. Despite the fact that mobile commerce is expected to be worth some US$31 billion by 2016, 62% of midmarket CMOs report being underprepared to deal with the proliferation of channels and devices. This increase in the mobile shopping trend further increases marketing challenges, complicates data collection and analysis, and threatens both customer service and customer retention.
Like their counterparts in larger enterprises, midmarket CMOs are also being held more financially accountable and are being required to prove business outcomes at a faster pace than ever before. In fact, while midmarket CMOs believe that the ROI on their marketing budget will be the most important metric for determining success of their business by 2015, 72% said they remain underprepared to manage plummeting levels of brand loyalty in the recession.
But apart from today's gloomy economic outlook, there's an even bigger factor impacting brand loyalty: innovations in technology and the spread of social networking have provided consumers with new tools for discovering, comparing, evaluating, choosing and experiencing brands. With the growth of social networks and a need for transparency, trust and personal exchanges between the consumer and the marketplace are now forming the cornerstone of small and midsize marketing efforts.
Every day, consumers are creating an incredible 2.5 quintillion bytes of data, with 90% of the world's customer data having been created - and stored - since 2010. The smart marketers are gaining insight from social media and incorporating it into their strategies, with the aim of predicting what consumers will want, and then adapting their marketing strategies to give them the right products when, where, and at the price they want.
"Social media offers a clear opportunity for companies of all sizes to engage directly with the consumer. This has changed the way that brand loyalty is acquired and earned," concluded Andy Monshaw, general manager for IBM's midmarket business unit. "With the explosion of social media, businesses have an opportunity to understand and target the consumer better, and that is opening up new avenues for small and midsize businesses to realise the potential of new information and communication technologies."