Chief marketing officers will be more cautious this year, with 73% saying they will rely on existing customers for growth rather than developing new markets, consulting firm Gartner found in a survey. The study also found that 39% of CMOs plan to boost sales of existing products to current customers, per an announcement emailed to Marketing Dive.
Only about a third (34%) of CMOs plan to introduce new products to existing customers, continuing a low-risk strategy that was warranted during the uncertainties of last year. However, this approach also promises a low return and contradicts CMO goals to "reinvent and rescale key strategies" they had developed during that period of upheaval, according to Gartner.
The firm recommends that CMOs try to remain agile during what is likely to be another challenging year and suggests they can do so by being selective in reinventing or rescaling initiatives from last year like virtual conferences and direct-to-consumer sales. Gartner surveyed 381 marketers from September to October, with 70% reporting that digital business intiatives accelerated during the pandemic while 51% plan to prioritize new digital experiences in 2021 and 48% named new digital sales or service channels as a top priority for the months ahead.
The new year promises to be another year of disruption as CMOs grapple with competing priorities to drive sales growth. Most CMOs favor a more cautious approach of focusing on existing customers, a strategy that matches the ongoing uncertainty about the pandemic and its impact on the economy and consumer behavior. The health crisis forced marketers to revamp their strategies amid a broad shift in consumer habits that included more online shopping and more time spent with digital media.
"Focusing on existing customers has a number of benefits for CMOs, namely being low cost and low risk. But low risk is matched by relatively low return," Jay Wilson, vice president analyst at Gartner Marketing practice, said in a statement. "At the same time, we see CMOs being overly ambitious in terms of the change they expect to bring to how their organizations interact with customers."
Gartner asked marketers about how they plan to either rescale their strategies to boost new growth or reinvent them for a post-pandemic environment. The study also asked if marketers plan to return to a pre-pandemic scale, pull back or retire strategies that aren't sustainable any longer. Half of the respondents said they intend to rescale or reinvent six of the 11 strategies pinpointed in the report, and 32% plan to rescale or reinvent eight of them.
The strategies marketers were queried about are: traditional physical sales practice; delivery or "buy online pick up in store" fulfillment; customer loyalty and retention programs; physical conferences and events; customer/user experience research; virtual sales practices; health and safety programs; direct-to-customer sales; voice-of-the-customer programs; sales via traditional retail channels, and virtual conferences and events.
Marketers may be trying to bite off more than they can chew in trying to rescale too many programs amid ongoing uncertainty, per Gartner.
"CMOs cannot reinvent and rescale everything while still executing effectively and remaining agile in a year that promises more challenges. Those who attempt to reinvent too much simultaneously risk failing to do any one thing right while overburdening their teams," Augie Ray, vice president analyst in the Gartner Marketing practice, said in a statement.
To avoid overburdening their marketing teams, Gartner recommends that CMOs focus on three key areas. First, they should be selective about their priorities, focusing on ones that are most essential in the short term and best suited for their current capabilities. Marketers should delay or delegate lesser priorities amid the 2021 uncertainties. Second, CMOs should document those decisions to help management focus on initiatives with the highest potential returns. Third, they should develop plans to adjust to different economic scenarios that may play out this year, according to Gartner.
(Source: Marketing Dive https://www.marketingdive.com/news/cmos-will-be-more-cautious-in-2021-with-growth-strategies-gartner-finds/593538/ )