growth team membership:european union 2010 marketing priorities survey results

Growth Team Membership™: European Union 2010 Marketing Priorities

Survey Results

February 2010

2Growth Team Membership™ Research.

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Table of Contents

The content of these pages are ©

2010 Frost & Sullivan. All rights reserved.

Page

Section 1: Survey Purpose and Respondents

4

Section 2: External Factors Shaping Marketing Strategy

5

Section 3: Key Marketing Challenges

9

Section 3.1: By Business Model

10

Section 4: Marketing Effectiveness and Expenditures

14

Section 4.1: By Business Model

16

Section 4.2: By Company Revenue

23

Section 5: Respondent Demographics

29


Survey Population

There were 262 survey

respondents

Research ObjectiveTo understand the most pressing external and internal challenges shaping marketing executives’

2010 planning

MethodologyWeb-based survey platform

Sample PopulationTarget respondents were Manager level and above marketing executives from companies throughout the European Union.

Co-Sponsorship:


External Factors Shaping Marketing Strategy


Top Three External Factors

N = 218

20%

28%

18%

0% 20% 40%

Intensifying competition

Need for product/serviceinnovation and capabilities

Tapping into global marketopportunities

Survey Question: Please indicate the three business environment factors that have the most impact on your 2010 Marketing plans.

KEY TAKEAWAY:

The top external factors reflect the need for new growth opportunities and coping with increased competition.


B-to-B B-to-C Hybrid

Need for product/service innovation and capabilities (21%)

Tapping into global market opportunities (50%)

Tapping into global market opportunities (24%)

Changes in customer buying behavior (17%)

Adjusting to the economic downturn (40%)


Intensifying competition (19%)


Changes in customer buying behavior (21%)

External Factor 1

External Factor 1

KEY TAKEAWAY: Regardless of business model, there is little variation in the external factors impacting Marketer’s 2010 plans.

Top Three External Factors by Business Model

N = 218

External Factor 2

External Factor 2

External Factor 3

External Factor 3


81% 81%

95%

0%

50%

100%

Tapping into global marketopportunities

Need for product/service innovationand capabilities

Intensifying competition

External Factor’s Impact on Marketing

N = 218

Survey Question: Please indicate the impact that each of the following forces have on your 2010 Marketing plans.

KEY TAKEAWAY:

Marketers are optimistic about the potential of global markets and innovation, but the competitive landscape is distinctly negative.

Negative ImpactPositive Impact


Key Marketing Challenges


Key Marketing Challenges Snapshot

All CompaniesTop three challenges:

Identifying new, adjacent market opportunities

Identifying new opportunities for existing products

Monitoring changing customer preferences and

B-to-B CompaniesTop three challenges:


Identifying new opportunities for existing products

Measuring marketing spend efficiency and effectiveness

B-to-C CompaniesTop three challenges:

Coordinating regional, national, and global brand management

Developing and implementing effective lead generation metrics for Sales


1

2

3

1

2

3

1

2

3


Top Five Key Marketing Challenges

Challenge 1Challenge 1 Identifying new, adjacent market opportunities (28%)

Challenge 2Challenge 2 Identifying new opportunities for existing proucts (22%)

Challenge 3Challenge 3 Monitoring changing customer preferences and needs (12%)

N = 182

Survey Question: Please indicate the top five challenges shaping

your Marketing decision-making in 2010.

KEY TAKEAWAY:

Marketing executives’

challenges reflect their external factors—finding new sources of growth.

Challenge 4Challenge 4 Improving Sales and Marketing integration (12%)

Challenge 5Challenge 5 Developing segment-specific offers (12%)


B-to-B B-to-C HybridIdentifying new, adjacent market opportunities (28%)

Coordinating regional, national, and global brand management (25%)

Identifying new opportunities for existing projects (40%)

Identifying new opportunities for existing projects (24%)

Developing and implementing effective lead generation metrics for Sales (50%)

Embedding voice of the customer into sales and marketing strategies (20%)

Monitoring changing customer preferences and needs (13%)

Identifying new, adjacent market opportunities (25%)

Improving Sales and Marketing integration (17%)

Improving Sales and Marketing integration (12%)

Understanding the needs of distribution and channel partners (50%)

Upgrading talent to stay competitive in the changing market environment (20%)

Increasing the pace of new product and service introductions (12%)

Measuring marketing spend efficiency and effectiveness (33%)

Developing segment-specific offers (26%)

Challenge 1

Challenge 1

KEY TAKEAWAY: Marketing executive’s challenges vary significantly across business models.

Top Three Marketing Challenges (By Business Model)

N = 182

Challenge 2

Challenge 2

Challenge 3

Challenge 3

Challenge 4

Challenge 4

Challenge 5

Challenge 5


Top Five Marketing Challenges: Root Cause

N = 175

Technology18%

Technology53%

Technology68%

Technology42%

Process30% Process

27%

Process14% Process

16%

Staff44% Staff

55%

Staff33%

Staff32% Staff

42%

Technology26%

0%

50%

100%

Identifying new,adjacent market

opportunities

Identifying newopportunities forexisting products

Monitoring changingcustomer preferences

and needs

Improving Sales andMarketing integration

Developing segment-specific offers

Survey Question: For the top three challenges you selected above, please indicate whether the root cause of the challenge is staff, technology, or process.

KEY TAKEAWAY:

For the top two challenges, Process and Staff are key root causes, but Technology is the critical one for the three remaining challenges.


Marketing Effectiveness and Expenditures


Marketing Expenditures and Effectiveness Snapshot

All CompaniesRank their marketing effectiveness as average

3% of their company’s revenue is allocated to the marketing budget

Largest budget expenditure is staff

Expect their staffing levels to stay the same in 2010

Expect their marketing budgets to stay the same in 2010

B-to-B CompaniesRank their marketing effectiveness as average

3% of their company’s revenue is allocated to the marketing budget

Largest budget expenditure is staff followed by traditional Marcom activities

Expect their staffing levels to stay the same in 2010

Expect their marketing budgets to stay the same in 2010

B-to-C CompaniesRank their marketing effectiveness as above average

4.5% of their company’s revenue is allocated to the marketing budget

Largest budget expenditure is channel partner programs

Expect their staffing levels to stay the same or increase moderately in 2010

Expect their marketing budgets to increase moderately in 2010


Average41%

Above Average37%

Exceptional4% Below Average

18%

Above Average75%

Average25%

Average44%

Above Average28%

Exceptional4%

Below Average24%

Average41%

Above Average37%

Exceptional5% Below Average

17%

All Companies B-to-B Companies

B-to-C CompaniesHybrid Companies

Marketing’s View of Its Effectiveness (By Business Model)

N = 160

Survey Question: Please assess the overall effectiveness of your marketing function compared to those in other firms within your industry.

KEY TAKEAWAY:

B-to-C marketers rank their function’s effectiveness higher than do their peers.


56%

21%

8%

3% 4%8%

33% 33%

0%

34%

0% 0%

50%

14%

5%

18%

0%

13%9%4%6%

54%

20%

7%

0%

20%

40%

60%

Below € 686,813 € 686,813 to €2.05Million

€2.06 Million to €3.42Million



€13.74 Million or more

B-to-B B-to-C Hybrid All Companies

2009 Marketing Budgets (By Business Model)

N = 144

Survey Question: Please indicate your 2009

total marketing budget (all expenditures on marketing activities and general & administrative—including staff) was in the range of in Euro€.

KEY TAKEAWAY: B-to-C companies are more likely to allocate over €686,813

to their marketing budgets.

The red percentages are for all respondents.

The red percentages are for all respondents.


4.5%

2.0%

3.0%

0.0%

5.0%

10.0%

B-to-B B-to-C Hybrid

Percentage of Annual Company Revenue Allocated to Marketing (By Business Model)

N = 104

Survey Question: Please provide your 2009

total marketing budget (from the previous question) as a percentage of total company revenue: The graph above indicates the median percentages of each business model.

KEY TAKEAWAY:

B-to-C companies are likely to allocate a greater percentage of their

revenue to marketing’s budget.

All Companies: 3.0%


40%

10%

5%2%

4%2%

4%2%

12%

0% 1% 1%

16%

2%0%

5%

35%

23%

8%5% 5% 5% 6%

4%

2%2%2%

5%

3%

40%

10%

5%

0%

20%

40%

60%

Staffing MarketingCommunications:Traditional mediaand promotions

MarketingCommunications:

Online/media

Public Relations Channel PartnerPrograms

CustomerRelationshipManagement

KnowledgeManagement

Training

B-toB B-to-C Hybrid Overall

Marketing Budget Allocation (By Business Model)

KEY TAKEAWAY: B-to-B and Hybrid companies allocate a significant proportion of their budget to staff. B-to-C companies’

major allocation is to their channel partner programs.

N = 104

The red percentages are the median values for all companies’

marketing budget by category.

The red percentages are the median values for all companies’

marketing budget by category.

Survey Question: What percentage of your total Marketing Budget is spent on the following? The graph above indicates the median percentages assigned to each component.


Decrease Substantially

5%

Increase Moderately

35%

Stay the Same39%

Decrease Moderately

12%

Increase Substantially

9%

Stay the Same50%

Increase Moderately

50%


12%

Increase Moderately

38%

Stay the Same25%

Decrease Moderately

19%


6%


9%Decrease Moderately

11%

Stay the Same41%

Increase Moderately

35%


4%

2010 vs. 2009 Staffing Plans (By Business Model)

N = 136

Survey Question: In comparison to 2009, your 2010 marketing staff

will:

KEY TAKEAWAY:

The majority of the respondents predict their 2010 staffing levels will remain the same or increase moderately.

Overall B-to-B Companies




1%

Increase Moderately

22%

Stay the Same63%

Decrease Moderately

9%


5%

Increase Moderately

100%

Stay the Same60%

Decrease Moderately

7%

Increase Moderately

33%


1%

Increase Moderately

19%

Stay the Same64%

Decrease Moderately

10%


6%



2010 vs. 2009 Budgets (By Business Model)

N = 131

Survey Question: In comparison to 2009, your 2010 marketing budget

will:

KEY TAKEAWAY: For the majority of respondents in all business models, budgets in 2010 will not be cut.



2%

Increase Moderately

59%

Stay the Same14%

Decrease Moderately

4%


21%

Increase Moderately

67%


33%


Increase Moderately

50%

Stay the Same17%

Decrease Moderately

11% Increase Substantially

22%


2%

Increase Moderately

60%

Stay the Same14%

Decrease Moderately

3%Increase

Substantially 21%



Anticipated Company Performance in 2010 (By Business Model)

N = 142

Survey Question: In comparison to

2009, your company’s performance by the end of 2010

will:

KEY TAKEAWAY:

The majority of the respondents, across business models, predict their company’s revenue performance will increase moderately in 2010.


18% 18%10%

18%

41% 41%50%

41%

43%

37% 37% 36%

42%36%

14%4% 4% 4% 8% 5%

43%

8%

42%

0%

50%

100%

All Companies Below €70 Million 70 Million to€347 Million

€348 to €695Million

696 Million to €7Billion

More than €7Billion

Marketing’s View of Its Effectiveness (By Company Revenue)

N = 160

Survey Question: Please assess the overall effectiveness of your marketing function compared to those in other firms within your industry.

KEY TAKEAWAY:

Higher-revenue companies are twice as likely to rate their functional effectiveness as below average.

ExceptionalAbove Average

Average

Below Average


54%

90%

50%

22%

20%

8%

35%

22%

30%

7%

4%

8%

18%

10%

6%

2%11%

10%

4%

13%

9%

25%15%

30%

34% 30%

25%

8%

0%

50%

100%

All Companies Below €70Million

70 Million to€347 Million

€348 to €695Million

696 Million to€7 Billion


Marketing Budget (By Company Revenue)

N = 104

Survey Question: Please indicate your 2009 total marketing budget (all expenditures on marketing activities and general & administrative—including staff) was in the range of in US$.

KEY TAKEAWAY:

As company revenue increases so does marketing budget.

€13.74 Million or More

€6.87 to €13.73 Million

€2.06 to €3.42 Million

€

686,813 to €2.05 Million

€3.43 to €6.86 Million

Below €

686,813


3.0%

4.0%

1.0%

2.5%

5.0%

0.0%

5.0%

10.0%

Below €70 Million 70 Million to €347Million

€348 to €695 Million 696 Million to €7 Billion More than €7 Billion

Percentage of Annual Company Revenue Allocated to Marketing (By Company Revenue)

N = 104

Survey Question: Please indicate what percentage of your annual company revenue is allocated to your marketing budget including Staff, Technology, Marketing Communications, Competitive Intelligence, Market Intelligence, Field Marketing/Lead Generation, and Thought leadership

event, whitepapers, etc. The graph above indicates the median percentages for each revenue band.

KEY TAKEAWAY:

Companies with revenue below €70 Million allocate a larger percentage of their revenue to the marketing budget.

All Companies: 3.0%


9%16%

3%

35%

39%

30%30%

36%

39%

39%

57% 33%

39%

18%

12%

6%

4%

21%10%

5% 9% 7%18%

11%18%

33%

23%

0%

50%

100%


€70 Million to€347.99 Million


€696 Million to€ 7 Billion


2010 vs. 2009 Staffing Levels (By Company Revenue)

N = 136

Survey Question: In comparison to 2009, your 2010 marketing staff

will:

KEY TAKEAWAY:

Companies with revenues over €7 Billion are more likely to cut their marketing staff substantially.


Decrease Moderately

Increase Moderately


Stay the Same


5% 6% 4% 3%

22%31%

13% 10% 20%

63%

63%

70%

13%

71% 60%

9% 13% 16%

10%

1%10%

13%

50%

24%

0%

50%

100%




€696 Million to€7 Billion


2010 vs. 2009 Budget (By Company Revenue)

N = 131

Survey Question: In comparison to 2009, your 2010 marketing budget

will:

KEY TAKEAWAY: Companies with revenues over €7 Billion are the only companies reporting substantial reductions in their marketing budgets.


Decrease Moderately

Increase Moderately


Stay the Same


Anticipated Company Performance in 2010 (By Company Revenue)

N = 142

21%31%

19% 14%

59%51%

63% 69%58%

14%18%

9% 22% 9% 8%

4% 9% 5%2% 3%

9%

11%

25%

67%

0%

50%

100%




€696 Million to€7 Billion


Survey Question: In comparison to 2009, your company’s performance by the end of 2010

will:

KEY TAKEAWAY:

Across all revenue bands, the majority of respondents predict their company’s performance will increase moderately.

Decrease SubstantiallyDecrease Moderately

Increase Moderately


Stay the Same


Respondent Demographics


Venture Capital6%

Public28%

Private66%

B-to-B80%

Hybrid17%

B-to-C3%

Demographics

N = 233

Over half of the respondents work in a private company.

Over half of the respondents work in a private company.

Survey Question: Please indicate the type of enterprise best represents your organization.

KEY TAKEAWAY:

The typical respondent works for a private, B-to-B company with revenues below €70 Million.

16%7%

27%

11%

33%

0%

20%

40%

Below € 70 Million € 70 Million to €347.99 Million

€ 348 Million to €695.99 Million

€ 696 Million to € 7Billion

More than € 7 Billion

Enterprise Type Business Model

Company Revenue

The overwhelming majority of the respondents work in B-to-B companies.

The overwhelming majority of the respondents work in B-to-B companies.

The largest set of respondents are in companies with revenues below €

70 Million.

The largest set of respondents are in companies with revenues below €

70 Million.

N = 240N = 240


20%

19%

18%

18%

28%

0% 20% 40%

Information and CommunicationTechnologies

Healthcare and Life Sciences

Electronics and Security

Energy and Power Systems

Automotive and Transportation

Demographics: Top Five Participating Industries

N = 258

More than 50% of the respondents are in the Information and Communication Technologies

or Healthcare and Life Sciences

industries.

More than 50% of the respondents are in the Information and Communication Technologies

or Healthcare and Life Sciences

industries.

Survey Question: Please indicate which of these Industry categories best describes you organization (please indicate all that apply).