Some 35% of CEOs at large organizations believe that their marketing’s sales performance is exceeding expectations, while fewer CMOs (26%) agree, according to a Forbes Insights study [download page] conducted in association with Rocket Fuel and Spencer Stuart. The survey – conducted among 296 global senior executives, 80% of whom hail from companies with more than $1 billion in revenues – suggests that CEOs may simply have lower expectations of marketing, as many believe their investments are wasted.
In fact, 69% agree (36%) or strongly agree (33%) that they believe their company wastes money on marketing initiatives, a sentiment shared by only 34% of CMOs (22% agree; 12% strongly agree). That’s an interesting result given that CEOs are more likely than CMOs to feel that sales driven by marketing initiatives are exceeding expectations. Beyond the possibility that CEOs may have lower expectations for marketing, it foretells potential budget constraints for CMOs, who are already having trouble proving their worth.
The CMO/CEO disconnect is equally large when measuring attitudes about customer knowledge. Specifically, 74% of CEOs agree (28%) or strongly agree (46%) that their company has limited insight into who is engaging with their products, almost double the share (41%) of CMOs who feel the same way (26% agree; 15% strongly agree). Moreover, 69% of CEOs agree (29%) or strongly agree (40%) that their company does not understand consumer likes/dislikes, while 37% of CMOs concur (22% agree; 15% strongly agree).
What’s the remedy? It’s “data to the rescue,” according to the study’s authors, who point to study results indicating that those executives who understand big data are more likely to be able to drive insights and avoid wastage. For example, among all respondents, those who “know” big data are more than twice as likely as those who don’t to know who is engaging with their products (56% vs. 25%) and know who likes or dislikes their products (56% vs. 25%). They’re also more likely to avoid wasting money on marketing initiatives (50% vs. 40%).
This effect translates across media, as those with a good understanding of big data are far more likely to than those without to report effectiveness in targeting consumers. That’s particularly the case for TV (61% knowing big data reporting targeting effectiveness versus 8% not in the know), radio (32% vs. 0%), digital display (78% vs. 15%), mobile (66% vs. 8%) and out-of-home (37% vs. 8%).
Circling back to the CEO/CMO relationship, the report notes that while 67% of CEOs feel they have an “excellent” relationship with their CMO, that figure rises to 81% among those who strongly agree that their companies “know” big data. (It’s even higher – 84% – among those companies are perceived to be wasting money on marketing. Go figure.) On the CMO side, fewer (54%) claim an excellent relationship with the CEO, though again that rises – to 76% – among those from companies that “know” big data.
About the Data: The results are based on a survey of 296 senior executives in September and October 2014, 41% of whom are CMOs and 38% CEOs. Manufacturing (16%) and insurance and healthcare (14%) were the most heavily represented industries, followed by retail (12%) and banking and finance (12%).
Almost half – 48% – of respondents are based in the US. 80% have revenues in excess of $1 billion, including 50% with revenues of at least $5 billion.