Marketing leaders enter the new year with an imperative to drive growth in a volatile environment

As Chief Marketing Officers (CMOs) enter 2023, the current environment necessitates a relentless focus on customer value, purposeful evolution of the marketing function, and continuous optimization of brand value. CMOs must act decisively to prioritize their investments and strategy for the year ahead in order to meet their enterprise mandate of driving growth amid continued disruption.

Some trends driving or might be contributing to disruptions includes:

• Conventional sources of brand value being eroded by market disruption dynamics

• Uncertainty further magnified by changing customer behavior

• Cross-functional collaboration is time-consuming and results in poor organizational performance
  

Conventional sources of brand value being eroded by market disruption dynamics

Conventional sources of brand value, like those that we are all familiar with, such as brand reach, sentiments, differentiation, etc, are being redefined by disruptive new technology and changing customer expectations. Customers are also accessing growing number of different social platforms, and this makes it even more challenging to understanding customer behavior.

Hi-tech is now easily accessible to many and companies are producing higher-quality products more easily than before. Customers know this, therefore more willing to try out new brands and this dynamic is actually eroding the value of having a strong brand and building brand loyalty.

Still, one strategy that many new entrants are depending on, is to rely on established players to enhance their marketing efforts. It mostly manifests in the form of a collaboration and has proven to be quite successful for a few brands.

Uncertainty further magnified by changing customer behavior

Customer demand and purchasing habits will change unpredictably in the face of inflation and economic instability. According to a Gartner poll of more than 1,500 consumers in September 2022, inflation is driving cost-cutting behaviors, with 30% of customers buying more store brands and about a fifth abandoning in-person shopping excursions in favor of internet purchases. This will put established brands under pressure to retain brand preference, premiums, and loyalty.

Furthermore, the majority of customers and B2B purchasers will withhold the personal data required to successfully track demand or respond with multichannel interaction, worsening CMOs’ data issues. Consumer data privacy precautions, such as browser cookie deprecation and new privacy features in iOS and Android, are also rendering traditional digital marketing strategies obsolete.

Cross-functional collaboration is time-consuming and results in poor organizational performance

Strategic marketing initiatives like innovation, customer experience (CX), and digital commerce have moved beyond functional boundaries to become enterprise-wide priorities requiring complicated cross-functional execution. Shared objectives may divert financing away from marketing departments that have yet to see their budgets recover to pre-pandemic levels, putting further burden on already-stressed marketing teams and resulting in worse performance against essential marketing targets.

To develop new cross-functional operating models, CMOs must adapt team structures and competencies. Improve the efficacy of marketing, sales, and other customer-facing teams by streamlining processes, establishing consistent key performance indicators (KPIs), and orchestrating communications throughout the customer experience.