Chief marketing officers (CMOs) are increasingly looking to create more personalized communications with consumers and are directing a greater portion of their budgets to this type of approach.
According to a new study from the Chief Marketing Officer Council, The Power of Personalization, more than 55 percent of CMOs said that they would spend more than 10 percent of their budgets on customized communications. One in four said they would allocate more than 20 percent of their marketing dollars to this type of messaging.
"Clearly, CMOs are gaining more confidence in the process of personalization and are increasingly willing to direct more of their marketing budgets to personalized communication tactics," said Donovan Neale-May, executive director of the CMO Council, in a press release. "Nevertheless, many marketers' programs have been deemed unsuccessful because of a lack of actionable customer data used in campaign planning - as well as because of inadequate analytics used in assessing post-campaign effectiveness."
Based on the responses of 700 CMOs, personalized communications are still in the infancy stage. Nearly 44 percent of respondents said their usage of personalized communications was "low" while just under 40 percent said it was "moderate." The remainder indicated a "high" level of customized messages going to consumers.
"Today's consumers are drowning in a sea of unrelated marketing campaigns, and marketers' dollars are being wasted as a result," said Barbara A. Pellow, group leader at InfoTrends. "Sixty-three percent of consumers prefer highly personalized and unique offers. More investment in personalized marketing is vital to the success of marketing campaigns and, to some extent, business results as a whole."
According to the CMO Council, data issues are a major challenge for marketers looking to get more personal with consumers. Nearly half said "inadequate systems and infrastructure" limited what they could do with customized messages while a "lack of customer data and insight" (26.2 percent) and "cost and complexity" (43 percent) also figured prominently in the concerns expressed by CMOs.
Discussion Questions: How would you rate the typical marketers "personalized communication" program? How great is the opportunity for personalized marketing communications to drive sales and profitability at retail? What are the keys to developing truly customized messages?