Gartner for Marketing Leaders
Recognize the Importance
of Digital Marketing
Laura McLellan
Vice President, Gartner Research
Gartner for Marketing Leaders
Lead Author
Laura McLellan
Vice President, Gartner Research
Gartner for Marketing Leaders
G00238768
Laura McLellan serves CMOs and other marketing executives, sharing how digital strategies
are being integrated with traditional marketing. With an extensive background in marketing
and information technology services, she helps CMOs understand how companies are
using digital marketing technology and marketing services to improve business results.
Recognize the Importance of Digital Marketing
Top 5 Issues That I Help Clients Address:
• How should the CMO adjust the vision and strategy of marketing to embrace
digital marketing?
• How much is being spent on digital marketing, by whom and on what?
• How should the CIO and CMO work together in digital marketing and other
technology-related areas?
• How should the marketing organization be structured to embrace traditional
and digital marketing?
• How is the role of the CMO expanding?
Analyst(s): Laura McLellan
Many CMOs are well along the path to integrating digital marketing
techniques and technologies into their organizations. Gartner provides
validation from marketing leaders that investments in digital marketing do
pay off.
Analysis
Additional Analysts
Jennifer S. Beck
Vice President, Distinguished Analyst
and Gartner Fellow
Gartner Research
Gartner for Marketing Leaders
Julie Hopkins
Director
Gartner Research
Gartner for Marketing Leaders
Richard Fouts
Vice President
Gartner Research
Gartner for Marketing Leaders
Michael McGuire
Vice President
Gartner Research
Gartner for Marketing Leaders
Andrew Frank
Vice President
Gartner Research
Gartner for Marketing Leaders
Published: 22 August 2012
Adam Sarner
Director
Gartner Research
Gartner for Marketing Leaders
Digital marketing techniques and underlying technologies are having a profound impact in
marketing investment priorities, budgets, organizational structure, skills and processes. Digital:
■
Forces organizations to rethink their relationship with customers at every stage of the buying
process, from research to transactions.
■
Promotes a marketing-led cross-organizational dialogue and efforts to improve customer
experiences.
■
Drives marketers to rethink what technologies their organization requires, those it desires and
how to best acquire and manage them.
When digital technologies facilitate breakthrough enhancements to marketing processes and
customer experiences, marketers, their organizations and customers win. Yet far too many digital
marketing activities are one-off or stand-alone initiatives that are not part of a comprehensive
strategy and are not measured against business goals. The purpose of this research is to share a
broader view of digital marketing's importance.
What Drives Digital Marketing Investments Today (and It's Not ROI)
Bill Gassman
Director
Gartner Research
Gartner for Marketing Leaders
Jake Sorofman
Director
Gartner Research
Gartner for Marketing Leaders
Yvonne Genovese
Managing Vice President
Gartner Research
Gartner for Marketing Leaders
Allen Weiner
Vice President
Gartner Research
Gartner for Marketing Leaders
A majority of marketers that we interviewed, 54%, invest in digital marketing because they believe
it's key to their competitiveness. But they are not certain of the return on their investment. For that
survey, which took place in April 2012, we interviewed 98 marketing executives in companies with
revenue greater than $1 billion, and who had or were considering a digital marketing function. We
asked the executives: "Thinking about digital or interactive marketing, its potential impact, and the
investment required to participate in the space, which statement best describes your organization's
position?"
Figure 1 shows that another 42% of companies did see the ROI and were investing for the same
reason — to gain an early advantage. Only 4% of companies did not know if there was strategic
value, but were investing to test the impact.
Figure 2. Sizing Up Digital Marketing's Importance to an Organization's Success
Very or Extremely important
4%
54%
The ROI of digital
or interactive
marketing is
cloudy, but we
are investing
because we
believe it is
strategic to our
competitiveness.
Percentage of Respondents
Figure 1. Position on Investment and Impact of Digital Marketing
We believe that digital or
interactive marketing is
important, but we do not know
whether there is strategic value
and are putting a toe in the water
to gauge its impact and ROI.
42%
Digital or
interactive
marketing is
strategic to our
competitiveness,
we understand the
ROI and we are
investing to get
early advantage.
89%
75%
48%
Today
In 12 months
In 24 months
Source: Gartner (August 2012)
Source: Gartner (August 2012)
What Activities Digital Marketing Helps to Succeed
What Will Drive Digital Marketing Investments Tomorrow
Figure 2 shows that 75% of respondents believe digital marketing will be very or extremely
important to the overall success of their organization — not just marketing, but their company —
one year from now and even more believe the same to be true two years from now. We asked
marketing executives: "How important is the use of digital or interactive marketing to the overall
success of your organization today, 12 months from now and 24 months from now, on a scale of 1
to 7, where 1 is not at all important and 7 is extremely important?"
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Then, we asked marketing executives: "Rate how important your organization's digital or interactive
marketing strategy is to the success of each of the following, on a scale of 1 to 7, where 1 is not at
all important and 7 is extremely important?"
The top answer? Brand building and differentiation, as shown in Figure 3. Next on the list: customer
communication, which is becoming a real-time activity. Understanding customer satisfaction ranked
high, too.
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Figure 3. Where Digital Marketing Helps You Succeed
Figure 4. 2012 Marketing Strategies Most Important to Success
Mean
Strengthen brand
across all channels
5.9
Brand building and differentiation
Consumer communication
5.5
Improve the
customer experience
Understanding customer
satisfaction with your product
5.5
Better utilize marketing
technology/services
11%
Accelerate speed (real-time
analysis & rapid response)
11%
Shop-ability: Improving the ability for the
shopper to find and select your product
5.0
Gathering product or
services innovation insights
5.0
B2C sales relationships (brand to
consumer)
4.9
Services associated with your
product to drive differentiation
4.8
Embrace
social media 3% 9%
Result
Technique
14%
16%
25%
15%
13%
18%
Most important
55%
38%
12%
10%
57%
11%
18%
29%
34%
30%
2nd most
3rd most
Source: Gartner (August 2012)
4.4
B2B sales relationships
Not at all
important 1
2
3
4
5
6
Extremely
7 important
Source: Gartner (August 2012)
The results from our two surveys show how brand building and improving customer experiences are
highly important to two different groups of marketers, underscoring the impact that digital marketing
has on these marketing objectives.
Where Increased Investment in Digital Marketing Technologies Are Planned
Digital Technologies and Services That Contribute to Success
In May 2012, Gartner conducted additional research — this time, it was a Web-based survey with
251 marketing executives who support marketing in U.S. and European companies, and were
buyers or influenced the purchase of digital marketing applications technology and services.
We posed the question, "Which of your organization's 2012 marketing strategies are most important
to its success?" to only the marketing executives.
Figure 4 shows the top five responses, which include: strengthening the brand across all channels
(29% of respondents) and improving the customer experience (25%). The next two responses are a
mix of techniques and results — better using marketing technology and services, and accelerating
speed through real-time analytics and rapid response. For more information about the requirement
for marketing to act in real-time, see the Recommended Reading section.
For our May 2012 survey, we asked the 251 marketing executives plus another 261 IT managers
who support marketing: "What are your company plans for investing in the following digital
marketing areas over the next 12 months?"
Mobile and tablet applications ranked highest for first-time investments as Figure 5 shows.
In addition, the majority of those participating in the May 2012 survey said they will increase their
investments in social media, mobile applications, CRM and customer analytics over the coming 12
months.
For the most part, companies anticipate making only small cuts in marketing technology
investments. Spending on email marketing and dashboards are two areas that are more likely than
others.
Some significant differences exist between U.S. and Europe, by company revenue size, and by
marketing versus IT respondent. Look for upcoming research with more details from this Gartner
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survey of 512 marketing and IT managers (80% B2B and B2C end-user companies and 20% hightech providers).
■
Communicate the importance and success of digital marketing in four ways:
■
One that mirrors your CEO and board of directors' top priorities, such as business growth,
customer attraction and retention, and increased competitiveness.
■
One that crosses functional boundaries and addresses sales, marketing and customer
service at minimum, possibly lines of business and other functions such as product
development and HR.
■
One that maps to key elements of your marketing investment strategy, such as brand
strength, sales campaigns and customer experience.
■
One that focuses on marketing tactics.
Figure 5. Planned Digital Marketing Investments, Next 12 Months
% Currently
Investing
RANKED BY PLAN
TO INCREASE
Social media
Mobile applications
11%
15%
CRM
7%
Customer analytics
6%
Tablet applications
Content management
61%
18%
3 7%
93%
17%
2 8%
92%
58%
54%
51%
18%
35%
48%
7%
20%
47%
Collaboration tools
10%
45%
Predictive analytics
11%
43%
3 4% 96%
32%
3
38%
3 5%
95%
11%
89%
2 5% 95%
35%
32%
2 8%
92%
11%
89%
3
Campaign management
8%
42%
38%
4% 8%
92%
Search engine optimization
9%
42%
36%
4% 8%
92%
Email marketing
9%
40%
Single view of customer
11%
36%
Score cards or dashboards
10%
Reputation management
8%
35%
36%
33%
3%
40%
32%
1st time investment
8%
41%
Increase
No change
6%
4%
Decrease
8%
14%
11%
15%
Recommended Reading
"Three Ways to Adapt to a World That Rewards Speed"
"Using Digital Marketing to Differentiate Yourself from Competitors"
"Ensure Emerging Trends and Technologies Advance Your Marketing Strategy"
92%
86%
Evidence
89%
This note is based on two Gartner primary research projects. In April, 2012, we conducted phone
interviews with 98 marketing executives in U.S.-based companies with revenue greater than $1
billion, who had or were considering a digital marketing function. In May 2012, we conducted a
Web-based survey of 512 executives (divided between marketing and IT managers), in the U.S. and
European companies who were buyers or influenced the purchase of digital marketing applications
technology and services.
85%
No plans to invest
Source: Gartner (August 2012)
Conclusion
CMOs and digital marketing leaders who want to learn how their efforts compare with those of their
peers can look to upcoming research from Gartner for Marketing Leaders. We'll track digital
marketing spending and impact. Extracts such as the one contained in this note will be offered on a
regular basis; longer analysis with findings and recommendations will also be shared. If you would
like to learn about the differences in responses by respondent demographics on all research results,
we invite you to contact to the author.
What to Do Next
■
Allocate a percentage of your budget for emerging digital marketing technologies and
techniques — and don't be afraid of failure — within limits.
■
Build in processes to test and measure digital marketing results — from pilots and ongoing
operations — so that you'll have supporting data if you need to kill a project or justify additional
funding.
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