[2010 trends] Core trends affecting marketers
If marketers are looking for an easy time in this new decade, they must think again. There are three core trends that are irresistibly affecting the way marketers conduct their business; and they are each substantial.
In an era of increased accountability, marketers must now adopt ways of proving their effectiveness. This is no longer an academic discussion but is set in stone in governance principles and accounting standards.
Coupled with this is the critical need for marketers to re-define themselves. Those who do not shift from being day-by-day functionaries to contributing to the firm's growth agenda will find themselves on the outside looking in.
Thirdly, the industry watched with concerned fascination the successful attack by powerful forces on the tobacco industry. Now attention has turned to alcohol and others and the industry will not emerge unscathed.
1) In recent years there has been a fierce concentration on the notion of marketing effectiveness and measurement.
Michael Dunn published a leading book on the topic (The Marketing Accountability Imperative - Jossey-Bass), which explains the essential need for marketers to account for their actions and their expenditure. The financial crisis of 2008 has reverberated through 2009 and, as recovery gathers momentum in 2010, firms will not easily forget the lessons learned during the crisis that greater care and governance might have softened the landing.
Dunn's book is timely because it provides guidance in areas that will be primary management requirements in the year and years to come.
But Dunn is not alone. The Marketing Science Institute (MSI), which is the barometer of threats and opportunities facing the marketing industry, has been drawing the attention of practitioners to this imperative for much of the last decade.
Every two years the MSI publishes its research priorities. These are the subjects that the MSI will provide research funding for and which it and its members have elected as the trends most vital to the industry's functioning. In one form or another, marketing return on investment has been the number one item for at least the past four periods.
I believe this is the year when management is going to call marketing to account.
Not only is it good governance to be able to support marketing programmes with quantitative evidence of what it is intended to achieve, but the catastrophic failure of businesses in 2008 makes it clear that every business function must demonstrate that it is contributing to the profitability of the firm and is creating shareholder wealth. Marketing is no exception.
2) There is strong evidence of a shift taking place in the role of the chief marketing officer (CMO). The nature of the shift is described in the eponymous book by Scott Davis (The Shift, Jossey-Bass, 2009).
For too many years, marketing has been a function. The board allocates money for marketing on the basis that it is something that has to be done and which might or might not product results. The fear has always been that perhaps value would be lost without it, but there is no clear understanding of exactly what it does or how it adds value.
This has started to change in recent years and the trend will pick up speed in the years ahead.
The foundation for the shift is that marketing builds brands and brands contribute to the wealth of the company. Davis summarises this in the sub-title for his book: “The transformation of today's marketers into tomorrow's growth leaders”.
Davis sees a four-stage evolution with marketers who were functional, routine, Tacticians evolving into Facilitators, who communicate within the organisation and who develop a language around the brand that is understood and spoken within the firm.
Next is the Leader who combines the previous roles but who uses customer insights and knowledge to apply marketing muscle throughout the organisation. The Leader drives the firm towards a marketing led strategic goal.
Finally, the Visionary marketer encompasses all of the preceding roles and, additionally, plays a role at the board level of contributing fully to the company growth agenda.
The revenue line of the income statement is the responsibility of marketing. Increasingly, this is going to be recognised by boards of directors, along with the realisation that it is the marketing programme that builds it and sustains it.
This trend implies that marketers will increasingly join the board but that their language of reporting will not be that of the marketing function but that of the boardroom itself - finance.
3) Marketing is going to be forced to adopt a more socially responsible approach to its promotional activities.
In May 2010, the World Health Organisation (WHO) will issue a draft strategy for the reduction of the harmful effects of alcohol. Already we have seen in early editions that marketing is viewed as being a prime suspect for encouraging underage and excessive drinking.
Pressure will increase next year after the strategy has been accepted to place limitations on all forms of marketing. The extent of this depends on the success or failure of several bodies that are arguing against harsh measures.
This follows the almost total ban of smoking and there are other product groups being considered: food, motor cars and drugs. At the very least, marketers will have to pay greater attention to the social responsibility that they carry when devising and developing their strategies.
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