Study: Senior marketers afraid to “let go”

Jun 24, 2007

Last week my employer, MS&L, and PR Week did a study among senior marketers asking if they thought CGM was very important to their marketing platforms. Just 12% thought it was.

You might be saying “Well, 12% is pretty high, Dave.”

I’m not disagreeing with that, but this was the kicker:

The survey also indicated that while marketers may be highly aware of the power consumers wield, most are still wary to give consumers more control. Just 22 percent said they were “very willing” to let consumers play a significant role in shaping their marketing programs.

That’s incredibly low. I can understand why this whole “letting go” has some brand managers and marketing folks nervous, but only 22% are willing to let consumers play a significant role in shaping marketing programs? I’m stunned. This ain’t the 1950s. It’s not about “reaching consumers.” It’s about engagement. It’s about listening and learning. It’s about embracing their values and not forcing them on “audiences.”

Our CEO, Mark Hass, had this to say:

“Despite the increased awareness of the power of consumers in a digital age on brands and sales, marketing executives are reluctant to loosen their grip on marketing content, unwilling to give too much control to these empowered consumers.”

Interesting to note what they will spend budget on this year:

1. Traditional online activities, such as building web sites (82%)
2. Targeting influentials (70%)
3. Media relations (65%)

Building web sites? Really? Welcome to 1995! ;)

CGM came in at 43%.

Here are the new media and CGM techniques their company had used:

1. Web site production (71%)
2. Consumer feedback for marketing/product strategies (50%)

Ah, so they’re sticking with the traditional one-way communication because, “nothing bad can happen if we don’t listen.” Riiiiiight …
Mark Hass noted:

“These marketers basically address the consumer empowerment trend by using web sites to get consumer feedback. This raises the issue of whether or not marketers really understand the concept of new media and CGM. Marketers who think that using a web site, or asking for consumer feedback on a web site, represent cutting-edge new media tactics are missing tremendous opportunities to build their brands.”

It is encouraging to know that a few years ago getting brands to give products out for review online was a big step, so for that number to reach 50% in a few years isn’t too bad. What’s really shocking is that while text message usage among Gen Y is high, only 10% of marketers used text messaging in programs last year.

Text messaging has privacy issues…

Consumer-generated advertising was used in only 14% of programs last year, which I’m guessing is making A.G. Lafley chuckle. The world’s top marketer says “let go” and 14% listened. Rome wasn’t built in a day either.

Innovation (36%) and cost (32%) were also considered solid reasons to engage in new media and CGM. But here is the stat I’m taking to every pitch:

Other popular reasons include … the declining credibility of traditional advertising and marketing (31%).

More telling are the reasons why they’re reluctant to let consumers take control:

  • No clear ROI (32%)
  • Don’t want consumers that close to their business (6%)
  • One-third (33%) gave various other reasons, such as “management doesn’t embrace it yet,” “we simply haven’t given it enough priority to consider it at this point,” and “we’ve had difficulty in getting the establishment to understand it.”

That last point needs restating: difficulty in getting the establishment to understand it.

I’m not going to turn this into a sales pitch for MS&L, WOMMA or any other group out there, but Iif you email or call me, explaining CGM will take no more than 5 minutes via phone without slides.

This isn’t that hard to grasp. Smart companies like my boy Clay C over at Quicken are seeing the ROI firsthand — their LeBron James Etch-A-Sketch video on YouTube cost less than $6,000 in out-of-pocket expenses to produce and has received over 1.3 million views. They just reached millions of consumers for a fraction of what they would pay for an ad, air time and acting talent.

Clearly this isn’t just about knowledge, though, as budget played a role in this conversation:

The survey results show that 31 percent of those polled say they have no budget for such programs, while 44 percent say there was no change to the amount of funding for new media and CGM efforts over the past year. Additionally, the survey shows that nearly 50 percent of respondents spend 10 percent or less of their company’s marketing budget on new media and CGM efforts. Industrywide, the technology sector spent the most, coming in ahead of consumer, healthcare and b-to-b.

It’s not a surprise to see that technology companies are spending the most in this space: that’s where their audience is: online, gaming, virtual worlds, blogging. If I were ranking them I would put b2b ahead of healthcare; legal and privacy concerns prevent a lot of pharmas and health care companies from doing more in this space.

I was recently asked, “How can you justify budget for something that has little or no internal buy-in? How would you propose I sell this in to take budget away from one program and put it toward this?”

The answer is simple: Look at your marketing mix and find the program that delivered the lowest return for you last year. When I worked at the Karmanos Cancer Institute we axed our Yellow Pages budget and put it toward online. It’s common sense- if something isn’t producing the results you want, you change course and try something else.

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1 Comment. Leave new

Constantin Basturea
June 27, 2007 4:19 am

Hi David – thank you for sharing!

Would it be possible to get more information about the survey’s methodology? The press release you’re pointing to states that “based on the sample size, the results are statistically tested at a confidence level of 90%.” However, sample size is not a guarantee for statistical significance. Thanks!

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