Industry convergence top concern for CMOs

A global report from IBM looks at what top marketers are doing to take on the growing challenge.

Industry convergence has raised its head as the biggest concern facing chief marketing officers globally, according to a new report from IBM.

In a survey of 723 CMOs across industries worldwide, including from Canada, roughly two-thirds named convergence – or disruptive technologies forcing formerly distinct industries to come together – as a trend having an impact on their business. Among the top tech considered by CMOs to be most disruptive is cloud computing and services (59%), mobile solutions (64%) and the “Internet of Things” (62%).

While convergence can create growth opportunities, it’s also increasing competition. In fact, more CMOs are concerned about competition expected from other industries (not just their own) than they were two years ago, according to the report.

Overall, 67% of CMOs said they intend to reassess their strategic direction because of tech disrupting the marketplace.

IBM also distinguishes some of the marketers into groups it calls “Torchbearers” (companies with stronger reputations for being innovative and with strong financial records) and “Market Followers” (those that are less financially successful and whose CMOs believe they have lower market profiles). Those groups make up 6% and 33% of the companies included in the survey, respectively.

Torchbearer CMOs place more focus on reaching the market first with new offerings, and two-thirds are looking into new revenue models (compared with half of Market Followers), according to the report.

Torchbearers are also more likely to make “internal disruption” moves by integrating marketing, sales and customer support. IBM points to companies like Zappos and Jabong as examples of those who have successfully made good customer service a part of their brand “essence.”

The leading CMOs are also more focused on creating both physical and digital opportunities for engagement, including by using more event and experiential marketing. Those Torchbearer CMOs also use customer feedback to look at new trends and even co-create products and services. San Francisco-based online retailer ModCloth, for example, has held design competitions and contests to come up with names for products.

Unsurprisingly, 60% of marketers want to use more data-driven insights for marketing campaigns in the next three to five years. Sixty-nine percent currently use predictive analytics, 45% use prescriptive analytics and 13% use cognitive computing.

To remain competitive, 79% of CMOs said they plan to hire new employees with digital skills and 74% plan to partner with other enterprises to benefit from their expertise.

Overall, Torchbearer CMOs are more confident in their ability to handle increasing volumes of data and about dealing with “an increasingly complex marketing mandate.”