Retail’s understanding of Digital appears nebulous
Caren Fleit
C-Suite Exec | Independent Board Director | Operating/P&L Leader | Strategic Talent Management | Marketing/Digital Transformation
According to our survey, only 37% of retail CMOs believe their CEO understands the marketing function. More so than in other industries, retail CEOs and boards seem to view "Digital" as something totally separate from marketing, and the functions are often not integrated. In retail, there seems to be a lot of confusion around where "Digital" belongs, and how it contributes to the bottom line. In other industries, we find the head of digital normally reports to the CMO, but in retail, more often it reports to the CEO. The right CMO and a more integrated structure could better advance the digital transformation agenda.
Another challenge retail leadership faces is knowing what it takes to successfully implement digital transformation. Retail CMOs (56%) are most frustrated by their company’s resistance to embrace and invest in progressive, innovative, and digital programs—nearly twice as poignant an issue as it is for other industries.
It’s also interesting to note where revenue generation fits into the equation. Retail CMOs feel like their CEOs and boards view them as revenue generators far more often than in other industries—which should be a good thing. Additionally, revenue generation capability is the second most important hiring attribute for retail marketers, at twice the rate as in other industries. And yet, retail marketing budget as percent of company revenue is one of the lowest of the industries we surveyed. So why the discrepancy? Perhaps it’s because so much investment goes into stores, which can be brand builders. However, with traffic as a challenge, customer engagement down, and marketers tasked with revenue generation, perhaps more funds should be allocated to marketing to drive traffic and improve customer experience. Either way, it’s clear that retail CMOs are feeling slightly disenfranchised and are probably not able to maximize their impact on the business.
Organizational and resource allocation changes must be considered for retail marketing to be as effective as it could be.
If you’d like a full copy of the Retail CMO Pulse Report, please email me at [email protected].
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5yStill current even two years out and prescient as well. Those who continued to invest only in stores have seen them continue to be devalued while those who've invested in customer experience, loyalty building and community have seen greater returns. Thanks for the insights Caren!
UBS Director, Annuity Sales
7ygood piece
Head of Digital title is just too broad a title to even begin with. Digital cannot only fall under purview of just the CMO. It is an enterprise wide function that requires interface throughout the operation and requires individuals that bridge consumer facing functions and all supporting systems.
Operational Strategy, Innovation and Growth
7yGreat post! When it comes to digital, the "bottom line" is understanding customer expectations which involves data mining and analytics. It's not about a message to the market, but a message to a very specific customer at a very specific moment in time. It requires a different skill set altogether, and a different approach to communicating with customers.
Head of Sales @ Retail Cities Global - Retailcities.com / Senior Advisor @ Decarbonizing Commerce - Decarbonize.co
7yGreat Caren