The latest results for the The CMO Survey (February 2018) are in. As promised, Professor Christine Moorman returns with an update. In this post, she examines the survey results as they relate to developing marketing knowledge and capabilities.
Results from the February 2018 CMO Survey (Highlights PDF) indicate that companies are investing in the development of marketing knowledge. The largest investment is in the development of marketing capabilities— which are the complex bundles of knowledge and skills for carrying out marketing activities that are deeply embedded in organizational processes. These capabilities are likely in areas such as digital marketing, MarTech platforms, and marketing analytics where companies are trying to get up to speed fast. A 6.5% increase in spending on marketing capabilities is expected in the next year.
Compare the 6.5% increase expected for marketing capabilities with the 3.9% increase expected for marketing research and intelligence, the 3.3% increase for marketing consulting, and the 2.5% increase in marketing training. Services companies outspend product companies on marketing capabilities while product companies outspend services companies on marketing research and intelligence.
When asked “How does your company approach the development of new marketing capabilities” results indicate that 56% of companies will build these capabilities themselves by training or hiring new employees with the necessary skills. Another 40% will use some type of partnering strategy to build capabilities—14% will partner with agencies, 14% partner with consultancies, and another 12% partner with other companies, such as value chain members. Only 3.5% will buy other companies to acquire new marketing skills.
These results came as a bit of a surprise to me. Instead, I expected most companies to use some type of partnering to learn. At the same time, I think companies are wise to adopt this approach. Building marketing capabilities is not easy and it is take investments and time. However, if companies can succeed in doing so, they are more likely to have a sustainable source of competitive advantage in house they can leverage over time. These capabilities can also spawn new capabilities and opportunities for growth over time.
How does your company build new marketing capabilities?
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Christine Moorman is the T. Austin Finch Professor, Sr. of Business Administration at The Fuqua School of Business, Duke University. Professor Moorman’s research focuses on understanding the nature and effects of information utilization and learning activities by consumers, managers, organizations, and financial markets. She has examined these issues in contexts ranging from innovation, marketing research relationships, networks and interfirm alliances, and the impact of public policy and regulation. Professor Moorman is the author of “Strategy from the Outside In: Profiting from Customer Value” with George S. Day, which was awarded the 2011 Berry Book prize for the best book in the field of marketing. Professor Moorman is the founding and current Director of The CMO Survey. The Marketing Journal will provide periodical updates from Professor Moorman as future surveys are administered.