ROI still likely: CMOs optimistic despite pressures

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Chief marketing officers are feeling good these days, which is pretty remarkable given how quickly the floor is shifting under them. Not only are consumers harder to reach, but these executives face considerable pressure from superiors to demonstrate return on investment for marketing expenditures.

"They're struggling with the need to meet short-term goals and directly affect sales while also meeting long-term brand building goals," said Anne Chambers, president, The Capre Group, Atlanta. In September, her firm surveyed more than 90 chief marketing officers at companies with an average of 130 employees

Law firm Alston & Bird, which has a specialty in intellectual property law, sponsored the survey.

The survey results show that marketers' positive perspective on their impact within their organizations and sense of empowerment derives largely from having bigger budgets, staffs that are stable or growing and job tenure of more than two years.

the issues

And they need those tools to tackle the issues. Because consumers are experiencing ads when they want to-thanks to time shifting TV, as well as interactive Web and cellphone messages-marketers are forced to use a more varied array of media.

Seeking to lure more 18-to-25-year-olds to their cable channel, executives at the Weather Channel first developed programming ("Extreme Weather Week") that would appeal to them, and then promoted the show's launch via an online effort. "This group tends to use the Web more, so our challenge was to find a way to migrate them to TV," said Wonya Lucas, exec-VP-marketing. She notes that as the amount of media proliferates, marketers have a new problem: "Understanding consumers' general behavior and media usage patterns becomes more complicated."

Media fragmentation is also forcing marketers to reorganize their departments so that they can better create consistent advertising that sends a clear brand message. Nearly half (48%) of respondents described these changes as small department and/or role shifts, while 12% of CMOs have deployed major restructurings.

At Chick-Fil-A, the Atlanta restaurant chain, traditional advertising efforts are considered only one part of the brand-building effort. Several years ago the company brought engineers into its marketing group to ensure that as new products are introduced across its 1,193 restaurants, or new shops are opened, the experience will be consistent.

But with such all-inclusive definition of marketing, developing firm ROI measures sometimes proves difficult. For example, said Barry White, VP-sales development, Chick Fil-A, "It is virtually impossible to determine what exactly the return on investment is on the work done by our design and construction team ... for instance."

While 30% of survey respondents said they use profit and revenue to prove marketing's return on investment, 13% said they use a marketing mix model, another 13% said they use common metrics across their entire organization.

In addition to integrated marketing programs, a majority (62%) of survey respondents cites innovation as a key element of success. Holiday Inn Express, for instance, each year introduces a service innovation and at rollout designs a measurement system to track its impact. "The results of our marketing make us empowered to continue with our efforts and ultimately engage [all hotel operators] to be supportive of our marketing efforts," said Jenifercq Zeigler, senior VP-brand management, Holiday Inn Express.

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