Trends: The Battle For CMO Mind Share

Published on August 2, 2012 by R "Ray" Wang

Marketing and Advertising Budgets Are The New Land Grab

Constellation Research, Inc. predicts that the global advertising market (paid search, display, and classified) will hit $125B by 2015.   While IT budgets continue to stay flat, marketing budgets are up.  Warc’s recent Global Marketing Index (GMI) entered positive territory in March 2012.  Consequently, the heat up in marketing and advertising market attracts not only start-ups, but also tech vendors looking to enter this lucrative market.

Solution Providers Rediscover The CMO Budget

In just less than 28 months, enterprise software vendors have bolstered their presence with Chief Marketing Officers mostly through acquisitions and partnerships.  The goal – capture budgets allocated for digital creation, marketing automation and revenue optimization, advertising, CRM and customer experience, analytics, and information brokering (see Figure 1).

Figure 1.  The Battle For The CMO Budget Comes From Six Fronts

Why the change? Marketing sits at the cross roads between the old analog world and the new shift to digital transformation.  With each big shift, organizations will change what technologies they invest in, who they decide to partner with, and how quickly they will make the shift.  This new battle for CMO mind share started when IBM purchased Unica for $480M in August 13, 2010 (Figure 2).  The frenzied activity by Adobe, Dell, Eloqua, Google, Hubspot, Kana, Marketo, Oracle,, and SAS Institute reflect the desire to be top of mind among CMO budgets.

Figure 2. The Rapidly Changing Landscape In Marketing and Advertising Technology

The Bottom Line: Digital Transformation Is A Must Have For The New CMO

Digital transformation is no longer a nice to have in the halls of the CMO.  In fact, today’s CMO will complete the shift from analog to digital in the next three to five years.  This shift corresponds to a shift from transactions to engagement.  In the design of new engagement strategies, CMO’s will rely more on digital models.  While analog will not go away, CMO’s expect to embed digital components into analog models for not only tracking, but also improved outcomes.

Consequently, three trends will arise in the market:

  1. CMO’s get tech savvy. The consumerization of IT is among us.  Business leaders such as CMO’s must get up to speed on how disruptive technologies will transform their business and their business models. The shift to digital transformation requires the adoption of new competencies in addition to the existing marketing skill sets.  CMO’s will need trusted advisers who understand their requirements.  Meanwhile, CIOs must design policies and procedures to support the extension of CoIT to new leaders.
  2. Tech emerges as a core competency in agencies.  Vendors need access to the marketing decision makers.  Today, agencies own the trusted relationships that solution providers need for access.  Technology vendors will partner up with agencies in a similar fashion as system integrators.
  3. System integrators will partner with agencies. System integrators will tie up with agencies to provide the tech skills the agencies lack.  In many cases, marketing outsourcing and marketing process outsourcing will emerge.  System integrators will also get into big data outsourcing by brokering information into subscriptions that marketers and agencies will consume.

Your POV.

Are you a CMO barraged with technologies that make no sense?  Do you need a trusted advisor who can explain what this means?  Planning a new customer engagement strategy?  Add your comments to the blog or send us a comment at R (at) SoftwareInsider (dot) org or R (at) ConstellationRG (dot) com

Please let us know if you need help with your business strategy efforts.  Here’s how we can assist:

  • Assessing social business/digital marketing readiness
  • Developing your social business/digital marketing  strategy
  • Designing a data to decisions strategy
  • Create a new vision of the future of work
  • Deliver a new customer experience and engagement strategy
  • Crafting a new matrix commerce strategy

Related Research:


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  • Hi Ray,
    Always good to read and know your views on emerging things. Although you seem to have stretched it a bit, but I think it is required to drive the point home.
    Wanted to also reconnect with you. Have met and heard you in L&T Infotech in our Mumbai Office. Any India visits planned soon ?

  • I have to use the ‘epic proportions’ idea when fighting for marketing budget 😉

    But seriously, social media & effective analytical tools are enabling narrowcasting. It’s like the famous David Ogilvy observation: “50% of all advertising is useless. We just don’t know which 50%.” Now we have the tools to know,

  • Tracie

    Thanks. it’s a burgeoning market as convergence and technology shifts take digital transformation to the next level. What do other folks see?


  • Ray,

    Any CMO hoping to grow business and not become an analog Willy Loman in a digital world must become digital savvy. NBC Olympic coverage shows that the best that oldmedia thinking can offer business is break-even. No breakthrough. No transformation.

    On the other hand, this notion of increases in digital advertising could be misleading. I agree that CMOs may hold the secret sauce to business growth, but don’t agree that this will be manifested in advertising. Social is not broadcast. It’s more organic and contains all customer touch points. It’s more about social as business model: 360 degrees, rapid response, customer-centricity, and customer-driven innovation. This will result in investment – including internal organization change management. And, the use of tools and metrics – new big data analysis. My sense is that advertising, as we know it, is being disintermediated to get more meaningful customer interaction.

    Perhaps we can classify investment into this meaningful interaction as advertising 2.0. That would make me agree with the figures.

    I shudder when considering the notion of integrators getting into this business, (Some of my best friends are integrators…). Not that integrators cannot help unlock some company mysteries and provide an outside perspective, but because there is a fundamental business transformation at work. It’s strategic. And, to be sustained, it must be in the corporate DNA. “Fast followers” can take advantage of these services. But, those companies that will upset the status quo must envision the social future without pages of consultant-speak. (Present company excluded: new models of delivery like with Constellation have more insight to nudge companies into the current century.)

  • Hi anonymous responder,

    Thanks for your comments. I don’t usually read the Forrester marketing reports. Maybe I should? =) I used to read more of the Jupiter stuff pre-acquisition. Sadly, many of the good marketing folks left Forester. A few good ones remain but that’s b/c the Forrester business model doesn’t support retention. If you have the courage to reveal yourself, I think we’d have a better discussion. =)


  • R “Ray” Wang, welcome to the party. I see that you successfully dusted off several Forrester reports from 5 years ago. Good work!

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