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Highlights and InsightsFebruary 2010
© Christine Moorman
About The CMO Survey
Mission
- The CMO Survey collects and disseminates the opinions of top marketers in order to
predict the future of markets, track marketing excellence, and improve the value of
marketing in firms and society.
Survey Operation
- Founded in August 2008, The CMO Survey is administered twice a year via an Internet
survey. Questions repeat over time so trends can be discerned.
- This is the 4th administration.
Sponsoring Organizations
Lead ResearcherProfessor Christine Moorman
T. Austin Finch, Sr. Professor of Business Administration
2© Christine Moorman
Survey Methodology
• Survey Sample
- 4,336 Top Marketers at Fortune 1000, Forbes Top 200, CMO Club companies, and
Top Marketers who are AMA Members or Duke University Alumni and Friends
- 612 responded for a 14.1 % response rate
- 81.1% of respondents hold a rank of VP, CMO, or higher
• Survey Administration
- Email contact with three follow-up reminders
- Survey in field from January 13-27, 2010
• Results Interpretation
- M = sample mean; SD = sample standard deviation
- B2B = Business-to-Business firms; B2C = Business-to-Consumer firms
3© Christine Moorman
Topic 1: Marketplace Dynamics 5-9
Topic 2: Firm Growth Strategies 10-12
Topic 3: Marketing Spending 13-16
Topic 4: Marketing Performance 17-19
Topic 5: Marketing Excellence 20-21
Topic 6: Marketing Organization and Leadership 22-25
Topic 7: Marketing and Social Media 26-28
Topic 8: Marketing Jobs 29-33
What’s on Marketers’ Minds? 34-35
Overview of Results
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5
Topic 1:
Marketplace Dynamics
5
Marketer optimism about overall
economy continues upward trend
Figure 1.1. How optimistic are you about the overall U.S.
economy on a 0-100 scale with 0 being the least
optimistic and 100 the most optimistic?
6© Christine Moorman
Figure 1.2. Are you more or less optimistic about the
overall U.S. economy compared to last quarter?
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
50.7
32
17.3
15
26
59
9
28.9
62.1
0 10 20 30 40 50 60 70
Less Optimistic
No Change
More Optimistic
Percentage of Respondents (%)
February 2010 August 2009 February 2009
57.7856.45
47.69
0
10
20
30
40
50
60
70
February 2010 August 2009 February 2009
… but now it’s personal
© Christine Moorman
Figure 1.3. Are you more or less optimistic about your
own company compared to last quarter?
40
28.9
31
20.4
31.4
48.2
10.6
25.6
63.9
0 10 20 30 40 50 60 70
Less optimistic
No change
More optimistic
Percentage of Respondents (%)
February 2010 August 2009 February 2009
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Marketer optimism about the overall economy
and optimism about firms are now on par--62.1%
for economy and 63.9% for companies.
Compared to August 2009, when Marketer
optimism about the overall economy ticked up to
59%, but optimism about their own companies
remained at 48.2%.
Marketers expect their firms to participate in the
anticipated recovery.
7
Customer activity expected to soar on
key revenue metrics
8© Christine Moorman
66
26
54
4745
48
17
44
39
35
30
14
32
37
27
0
10
20
30
40
50
60
70
Increased customer purchase volume
Increased customer price per unit
Customer will buy more related products and
services from my firm
My firm's ability to retain current
customers has increased
Increased entry of new customers into
the market
Per
cen
tag
e o
f R
esp
on
den
ts (
%)
February 2010 August 2009 February 2009
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Major uptick in expected customer
purchase volume, price per unit,
purchase of related products and
services, customer retention, and
entry of new customers into market.
Figure 1.4. Customers Improve on all Revenue Metrics
Channel partners rebound as well
9© Christine Moorman
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
August 2009 showed partners not performing
well. February 2010 indicates they are waking
up.
More companies will go directly to customer
(from 24% to 30%). This is reflected in internet
spending discussed in Section 3.
Figure 1.5. Channel Partners Improve on Revenue Metrics
52
19
40
30
36
14
24 2425
10
19
26
0
10
20
30
40
50
60
Increased partner purchase volume
Increased partner price per unit
Partner will buy more related products and services from my firm
My firm will deal directly with end
customer more, not through channel
Per
cen
tag
e o
f R
esp
on
den
ts (
%)
February 2010 August 2009 February 2009
10
Topic 2:
Firm Growth Strategies
10
Growth through diversification
Table 2.1. Growth Spending in Next 12 Months*
Current
Products/
Services
New
Products/
Services
Current Markets
Market Penetration
Strategy
Product/Service Development
Strategy
New Markets
Market Development
Strategy
DiversificationStrategy
* % of spending across growth strategies
11© Christine Moorman
Types of Growth Strategies
Sector differences: B2B-Product firms expect the biggest reduction in market penetration (from 44% to 39%) and the biggest
increase in diversification (from 10.8% to 15%)
Strategy Feb-2009 Aug-2009 Feb-2010
Market
Penetration
Strategy48% 46% 44%
Market
Development
Strategy18% 18% 18%
Product/Service
Development
Strategy
24% 26% 26%
Diversification
Strategy 10% 10% 13%
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Growth via partnerships and
acquisitions continues to increase
Table 2.2. How Firms Will Grow in the Next 12 Months*
12© Christine Moorman
Strategy Feb-2009 Aug-2009 Feb-2010
Growth from your
firm internally70.9% 70.3% 69.5%
Growth from
acquisitions8.8% 9.7% 10.4%
Growth from
partnerships13.3% 13.4% 14.7%
Growth from
licensing7.0% 6.6% 5.4%
* Percentage of spending across growth strategies
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Organic growth continues to dominate growth
strategies.
Small decrease in internal growth met by small
increases in acquisitions and partnerships.
13
Topic 3:
Marketing Spending
13
Marketing Spending Up
Figure 3.1. % Change in Marketing Spending in Next 12 Months
14© Christine Moorman
* Question not asked in February 2009
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Overall marketing budgets are expected to rise
by 5.9% -- the largest expected increase in a
year: Aug-09 (1.1%) and Feb-09 (0.5%)
Internet marketing expenditures account for the
largest increase: 12.2%
Traditional advertising spending change remains
negative (-2.5%), but smaller losses than in Aug-
09 (-7.9%) and Feb-09 (-7.3%).
Investments in key marketing assets rise:
- Brand building (from 1.8% in Feb-09, 4.5% in
Aug-09 to 6.9% in Feb-10).
- CRM (from 6.4% in Aug-09 to 9.9% in Feb-10). -10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Feb-09 Aug-09 Feb-10
Overall marketing spending
Traditional advertising spending
Internet marketing spending
New product introductions
New service introductions*
Customer relationship management*
Brand building
Sector Differences:
• Brand building: B2B-Service firms (+11.8%) vs. (+4.3%) average across sectors
• Customer relationship management: B2B-Service firms (+13.6%) vs. (+7.5%) average across other sectors
• New service introductions: B2B-Service (+10.4%) vs. (+5.3%) average across other sectors
• New product introductions: B2B firm (+11.25%) vs. B2C firms (+4.7%)
Marketing spending priorities vary
across sectors
Figure 3.2. % Change in Marketing Spending by Sector in Next
12 months
15© Christine Moorman
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Feb-09 Aug-09 Feb-10
B2B - Product
B2B - Services
B2C - Product
B2C - Services
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Spending on marketing knowledge and
services rebounds
Figure 3.3. Firm Spending Increase on Marketing Knowledge
in Next 12 Months
16© Christine Moorman
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
Feb-09 Aug-09 Feb-10
Marketing research and intelligence
Marketing consulting services
Developing knowledge about how to do marketing
Integrating what we know about marketing
Marketing (non-sales) hires
Marketing training
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Marketing consulting services had been negative
(Feb-09) or very small (Aug-09). A 2.9% increase
may signal revitalization of the industry.
- Biggest increase from B2B-Services (+4.5%)
Increases in research and intelligence (+7.3%) likely
indicate firms are investing to search for growth
opportunities.
- Biggest increase from B2B-Services (+10.6%)
Emphasis remains on developing knowledge about
how to do marketing (+6.4%) and integrating what we
know about marketing (+7.4%)
17
Topic 4:
Marketing Performance
17
Firm performance metrics mixed;
goals up!
Table 4.1. Firm Performance on Financial Metrics
Actual firm performance Feb-2009
Actual firm performance Aug-2009
Actual firm performance Feb-2010
Goal in the next 12 months
Firm sales* -0.6% - 0.1% 6.1%
Market share 3.0% 2.2% 1.6% 4.7%
Marketing return on investment 2.6% 1.9% 1.9% 5.2%
Firm profits 1.6% 0.5% 0.6% 6.0%
Customer acquisition 3.3% 2.6% 2.1% 5.3%
Customer retention 2.3% 1.4% 1.7% 4.7%
Brand value 3.7% 3.2% 2.6% 5.7%
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* Question not asked in February 2009
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Marketers focus on “going green”
remains moderate and unchanged
* 5-point scale where 1 is poor and 5 is excellent
19© Christine Moorman
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Figure 4.1. Firm Performance on Social Metrics
3 33.1 3.13.23
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
Marketing that is beneficial for society
Marketing that minimizes the impact on the ecological environment
Mean Values*
February 2010 August 2009 February 2009
20
Topic 5:
Marketing Excellence
20
Peers nominate firms for marketing
excellence across sectors, industries
Honorable MentionsWinners of The CMO Survey Award for Marketing
Excellence, February 2010
21© Christine Moorman
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
22
Topic 6:
Marketing Organization and
Leadership
22
Marketing and sales share customers in
most companies
23© Christine Moorman
Figure 6.1. The Marketing-Sales Relationship
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
70
11.49.7
74
13.1
8.3
69
11 12
0
10
20
30
40
50
60
70
80
Sales and marketing work on an equal basis
Marketing is within the sales function
Sales is within the marketing function
Per
cen
tag
e o
f R
esp
on
den
ts (
%)
February 2010 August 2009 February 2009
Marketing leaders retained through
economic crisis
24© Christine Moorman
Figure 6.2. Marketing Leader Retention
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
4.5
8.6
4.3
8
4.4
8.3
0
1
2
3
4
5
6
7
8
9
10
Top marketer time in current role in the firm
Top marketer time in any role in the firm
Yea
rs
February 2010 August 2009 February 2009
Top marketers continue to beat oft-cited 231 and
281 month survival averages.
Given length of time in firms (~8.6 years),
marketing leaders appear to be appointed from
within.
1. http://content.spencerstuart.com/sswebsite/pdf/lib/CMO_brochureU1.pdf
2. http://www.btobonline.com/apps/pbcs.dll/article?AID=/20090130/FREE/901309991/1078
Investments in building strategy
from the outside-in rebounds
Figure 6.3. Firm Market Orientation* and Strategy
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Firms invest more in learning about markets and in using market information to drive strategy
*Rate the extent to which your firm engages in the following market-oriented behaviors. Information about customers and competitors….
** 7-point scale where 1 is not at all and 7 is very frequently
25© Christine Moorman
5.2
4.7
4.6
4.8
4.9 4.9
5
4.5
4.6 4.6
4.7
4.6
4
4.2
4.4
4.6
4.8
5
5.2
5.4
Is collected on a regular basis
Is shared vertically across different levels of the firm
and business units
Is shared horizontally across different functions
and business units
Shapes the design of firm strategies
Influences the implementation of firm
strategies
Impacts the evaluation of firm strategies
February 2010 August 2009
Mean
Value**
2626
Topic 7:
Marketing and Social Media
26
Social media spending continues to
accelerate
27© Christine Moorman
Figure 7.1. Social Media Spending Over Time
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Fast-growing spending exceeds August 2009
levels.
Within 1 year, social media is expected to be 10%
of all marketing budgets and nearly 18% in 5
years.
5.6
9.9
17.7
3.5
6.1
13.7
0
2
4
6
8
10
12
14
16
18
20
Current marketing budget spending on
social media
Marketing budget spending on social
media in the next 12 months
Marketing budget spending on social
media in the next five years
Per
cen
tag
e o
f To
tal B
ud
get
(%
)
February 2010 August 2009
Social media spending sector
differences
28© Christine Moorman
Aug-2009 Feb-2010
Current
Social Media
Spending
B2B - Product 2.5% 3.4%
B2B - Services 3.9% 6.5%
B2C - Product 5.3% 6.7%
B2C - Services 2.9% 6.9%
Overall 3.5% 5.6%
Social Media
Spending in
the next 12
months
B2B - Product 4.5% 7.4%
B2B - Services 6.5% 11.0%
B2C - Product 7.5% 11.6%
B2C - Services 8.8% 10.7%
Overall 6.1% 9.9%
Social Media
Spending in
the next 5
years
B2B - Product 12.6% 15.3%
B2B - Services 13.5% 18.9%
B2C - Product 15.0% 18.9%
B2C - Services 15.4% 18.5%
Overall 13.7% 17.7%
Table 7.2. Sector Differences in % Change in Social Media Spending Biggest increase in current social media spending
among B2C-Services companies (from 2.9% to
6.9%).
Largest increase in next year to come from B2B-
Service companies (from 6.5% to 11%).
Within 5 years, industries generally on par with
social media spending.
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
29
Topic 8: Marketing Jobs
29
Marketing hires to increase; marketing
layoffs stop
Figure 8.1. Absolute number of marketing people hired
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Compared to the number of marketing hires last
year, by what percentage will your firm’s
marketing hires change:
- In the next 6 months: +8.2%
- In the next year: +12.9%
- In the next two years: +24.1%
30© Christine Moorman
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Next 6 months
Next 12 months
Next 2 years
Per
cen
tag
e o
f C
om
pan
ies
Res
po
nd
ing
(%
)
We will not let go of more marketing people
We will make no marketing hires
We will make marketing hires
It’s a buyer’s market for marketing job
seekers
Figure 8.2. Types of marketing hires firms will emphasize*
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
*Allocate 100 points across the types of marketing hires your firm will emphasize
Companies to emphasize hiring in the open
market (46%) and luring talent from competitors
(24%).
Experience emphasized as only 27.1% of hires
expected to come from universities.
31© Christine Moorman
46.2
24
15
11.5
2.60.6
0
5
10
15
20
25
30
35
40
45
50
Hire in the open market
Lure from other firms
New undergrads
New masters (MS or MBA)
Hire back people we laid
off
New Ph.D.
Per
cen
tag
e (%
)
Marketing skills emphasize
management of new media and growth
Figure 8.3. Top three skill sets prioritized in marketing hires
54
46.3 45.2 44.5
28.8 27.8
19.918.1
8.96.4
0
10
20
30
40
50
60
Per
cen
tag
e (%
)
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
Internet marketing tops the list of skills sought
in marketing hires. This priority is also
reflected in spending on internet marketing—
which showed the largest increase in
marketing spending.
Improving management of top line through
innovation and growth skills is second.
Skills related to managing the firm’s key
marketing assets (customer and brand) also
important.
Traditional marketing skills, such as
marketing research, advertising, distribution,
and pricing de-emphasized.
32© Christine Moorman
The outsourcing of marketing will
continue to accelerate
72% of all companies outsource some aspect of
marketing.
Half of all companies will not change marketing
outsourcing in the next year.
41% of companies will increase outsourcing.
- Future surveys will explore outsourcing in
more detail. However, given spending on
internet marketing and new growth and focus
on these skills in hiring, we expect that some
of these marketing activities are currently
being outsourced.
Figure 8.4. How marketing outsourcing is expected to change in
the next year
JobsSocial MediaOrganizationExcellencePerformanceSpendingGrowthMarketplace
33© Christine Moorman
3%
6%
2%
48%
12%
17%
12%
0%
10%
20%
30%
40%
50%
60%
10% decrease
5-9% decrease
1-4% decrease
No change
1-4% increase
5-9% increase
10%+ increase
34
What’s on Marketers’ Minds?
34
When asked what question they
would like to ask other CMOs, ROI
concerns dominated
35© Christine Moorman
Look to the
August 2010
survey for a
bonus section
on Marketing
ROI
Key Question: Marketing and ROI
• What marketing activities and strategies improve
ROI?
• What metrics are used for ROI? How do these
vary by industry?
• What metrics are used to measure ROI for social
media?
• How do you measure ROI on customer insights?
• What ROI metrics are top management most
focused on in your firm?
Next Steps
36
Future surveys- The CMO Survey will be administered again in August 2010.
To get involved- If you are not a current participant, sign up at
http://faculty.fuqua.duke.edu/cmosurvey/participate/
Media- Media follow ups related to this data will be posted to
http://faculty.fuqua.duke.edu/cmosurvey/media/
Feedback- Send your thoughts to me at [email protected]
© Christine Moorman