Some of the biggest changes in marketing have happened over the last three years, from rapid ecommerce and digitisation advancements in response to the pandemic, to drastic shifts in customer needs, to the introduction of some of the most sophisticated AI we’ve ever seen.
Now is the time to prioritise and rethink how marketing strategies and the way we build our teams enable business growth and boost revenue.
At our latest event, we unpacked the past, the future, and the impact of marketing excellence and its place on the board. Facilitator Jonathan McKay welcomed panellists Simon Peel, Lea Hartkopf, Phill Robinson, and Neil Morgan for this insightful session.
What the numbers tell us
Global marketing investment is expected to grow 30% by 2025, an increase of £3.5trillion.
According to Gartner’s annual CMO Spend and Strategy Survey, marketing budgets have recovered somewhat following the pandemic, with the average marketing spend increasing from 6.4% to 9.5% of company revenue across almost all industries. While this is a significant uptick, budgets still lag behind pre-pandemic levels — between 2018 and 2020, they averaged 10.9% of company revenue.
Financial services, travel and hospitality, and tech product companies stand out, recording budget increases at 10.4%, 8.4%, and 10.1% of company revenue respectively. In contrast, spending for consumer goods CMOs decreased slightly from 8.3% in 2021 to 8.0% in 2022. Inflationary pressures, cost-of-living increases, and lower consumer confidence are hitting consumer goods brands hard.
Performance marketing saw the most growth in 2021, and the ability to measure the ROI of digital marketing will be key to CFOs and wider management in the future.
‘Sales and product marketing’
“The Golden Triangle is marketing, product, and sales; it’s not isolated. Every time I come into a business and the expectation is “transform our marketing”, I need to talk to the sales team, I need to talk to the product team. And together we need to figure out what the funnel looks like and are there any massive gaps. There’s no point in spending money when there’s a leaky bucket.” Lea Hartkopf
Promoting interaction and collaboration between sales, product, and marketing is the future of commercial success; each of these business functions has a different market understanding, skill set, and data focus which, when combined, result in a more successful outcome.
Understanding what the combined funnel for these functions looks like is key. Equating budget and resource input with ROI – specifically qualified leads, customer interactions, and individual sales – is the specific information that will help to foster buy-in from the board and C-suite.
Buyer habits and customer journeys have changed significantly in recent years, and sales, product, and marketing insights are vital in identifying areas where the most impact can be made. Data is king when it comes to pinpointing inefficiencies or gaps in the combined funnel, discovering how and where value can be added to encourage customer progress through the buyer journey.
We tend to think of B2B as selling to businesses and B2C as selling to people, but B2B is also about selling to people. A ‘company’ doesn’t buy things; a group of people or an individual within the business decides to buy on behalf of the company. As a result, sales and product marketing must be personalised for both: who are the people within those businesses, what’s going to make them buy, and what pain points do the decision-makers have?
Changing talent trends
The role of the Chief Revenue Officer (CRO) and its proximity to the role of CMO has changed in recent years, with the two now interacting more closely. With many CEOs and C-suite professionals coming from finance and sales backgrounds as opposed to marketing backgrounds, linking revenue to marketing has resulted in more visibility at a boardroom level.
“Two years ago, pretty much every company hired tonnes and tonnes of salespeople, but they forgot to hire more marketing people. As a result, the growth engines didn’t accelerate as expected. If you’d have told those salespeople that 100% of their pipeline needed to come from them, they would never have taken the job.” Simon Peel
Particularly for organisations that ramped up hiring across their sales functions in the post-pandemic growth period, the need for marketing talent is at an all-time high. Whilst the salespeople may be the vehicle, marketing-qualified leads are the fuel that makes them run; without those resources in place, sales teams are left to fend for themselves.
Cross-collaboration appears to be the current strategy, with marketing teams encouraged to interact on a deeper level with sales and product teams to gain a greater understanding of the conversations these departments are having with customers. By positioning marketing as a company-wide function, the cause and effect of resulting marketing campaigns can be more widely felt and, therefore, valued.
What does the future hold?
“If you think about the specifics around marketing, you won’t be replaced by AI, but you might be replaced by someone that’s using an AI assistant, because they can be so much more productive using that technology. They need to be working together to check the output of this thing, that it’s reasonable for what you’re trying to do.” Phill Robinson
AI – specifically ChatGPT – is one of the most significant technological introductions we’ve seen in many years, and whilst it will certainly make creating content an easier task for the masses, its use as a targeted marketing device is in question. With everyone using the same tool, will the resulting output also look the same?
The prediction by industry experts is that the market will be flooded with content, much of it irrelevant and unfocused, meaning that curated content produced by individuals will become more valuable, driving demand for this type of talent. Using the design platform Canva as an example, rather than replacing the role of a designer on a marketing team, its introduction has resulted in efficiencies with simple and small visual tasks, leaving the designer to concentrate on those that require specialist expertise.
Scrutinising of data on an individual level is another forecasted focus; identifying personas and developing propositions based on understanding of specific buyer groups. Rather than building campaigns for each type of media, marketers will instead look at how they can be present in their customers’ lives throughout the day: when they read the paper, when they get on the tube, when they listen to a podcast, when they post on social media, when they watch tv. Delivering the right message in the right way that fits into that model, instead of “let’s put everything into optimising Facebook ads” is going to be the next big step in marketing.
Top tips from the panel
“You’re trying to change human behaviour and doing that requires a consistent message in front of the folks you’re tracking over and over and over again, many, many, many dozens of times, spread across multiple, ideal customer profiles.” Neil Morgan
Simon Peel – Chief Growth Officer at Marlin Equity Partners. Serial CMO, Chief Strategy Officer and Global Head of Enterprise Sales at Jitterbit, IBM, Aible, Cast Iron Systems. Voted one of the 10 Most Innovative CMOs of 2018.
Lea Hartkopf – Marketing Consultant working with Private Equity backed businesses and member of the Inflexion Digital Associates network. Formerly leading Marketing teams at PayPal, Trainline, and Busuu.
Phill Robinson – Chairman of the Software Advisory Board at Livingbridge. Former CEO at Exact Software (Apax, KKR), Operating Partner at HgCapital, and CEO and Chair at Iris Software.
Neil Morgan – Plural CMO and Strategic Advisor to Zivver, Orbus Software, Zapnito. Former CMO of Go Cardless and EVP Global Digital Marketing at Sage.
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Lise FerrierHead of Sales & Marketing Practice