24% CMOs in India Feel That the COVID Crisis Has Helped Their Business, Finds Dentsu Survey
by EVENTFAQS Bureau Industry Watch | October 16, 2020 | News
Global media, digital and creative communications agency Dentsu released a new study - ‘Into the Unknown’ - involving 1,361 CMOs across 12 markets, analysing how CMOs are navigating their recovery in the post-COVID scenario. Despite a challenging period, CMOs are reclaiming their strategic agenda with a particular focus on product development. More than 450 CMOs from Australia, China, India and Japan were surveyed during the study.
Interestingly, as CMOs look ahead cautiously to the recovery, it’s clear that they are starting from very different places. Six out of 10 CMOs surveyed say that their businesses have been significantly or somewhat affected by the pandemic. A further 7%—nearly all CMOs of smaller businesses—suggest that the crisis represents an existential threat. However, at the same time, one quarter of CMOs report minimal disruption to their business while one in 10 CMOs (generally larger businesses) report that the crisis has in fact helped their business. This rises to nearly one quarter (24%) among CMOs in India. Clearly, the global pandemic has not been universal in its business impact, with many benefiting and others remaining largely unchanged.
HOW WILL CONSUMERS CHANGE?
According to the study, the No. 1 challenge faced by the CMOs is understanding which consumer behaviours will change permanently and which will fall away in the post-COVID environment. CMOs report that this is compounded by the difficulty of aligning the business around changing consumer needs quickly enough and falling consumer spend.
The study raises concerns that half (49%) of CMOs concede they are basing their response to the coronavirus crisis on strategies that were pursued during previous recessions. Globally, just one in 10 CMOs are looking at entirely new strategies. In Asia Pacific, nearly half (46%) in India are using ‘completely’ similar strategies to those pursued in previous recessions, compared to 17% global average. On the other hand, only 6% in China are doing so.
It is also found that despite the general advice that brands should not ‘go dark’ during times of recession, nearly two-thirds (62%) of CMOs recount that their marketing budgets are forecast to decline or remain flat over the coming 12 months. In Asia Pacific, Australia is the second highest market to predict marketing budget to decline (36%) and Japan is the third highest market anticipating that budget will stay flat (29% vs global average 22%). On the contrary, China is the second highest (56%) to predict budget increases in the coming year.
Wendy Clark, Global CEO, Dentsu, said, “Exceptional times call for exceptional thinking. The COVID-19 global health crisis has yielded an incisive economic downturn that creates an unknown and largely unpredictable environment for CMOs to navigate. And our survey reveals there is a risk that CMOs are still using existing approaches to manage a challenge that is without precedent.”
“However, we also see a new cadre of Frontier CMOs emerging who are leading their organizations into the unknown with confidence. These CMOs are putting consumer intelligence at the heart of their brands, matched by deep integration across all elements of the marketing mix and radical collaboration as a default across their business. Product development is firmly back on the agenda also, in order to deliver helpful consumer experiences and societal progress. These Frontier CMOs are reclaiming the strategic marketing agenda and, instead of buying into the idea that marketing’s role has somehow been denuded, they’re now leading their brands to recovery and growth,” Clark added.
WHAT MAKES A ‘FRONTIER CMO’
Ashish Bhasin, Asia Pacific CEO, Dentsu, said, “The pandemic has significantly accelerated a number of existing trends. What would have taken five years has now only taken five months; it has pushed and forced us to learn. Changes to the workplace such as remote working is an example. With every disruption comes its own sets of winners and losers. It is crucial for CMOs to keep up with the new skills required in today’s new world to ensure success in the discontinuity. We are right in the midst of a change and this is exciting.”
Overall, the study recognises that a new style of marketing leadership is emerging. ‘Frontier CMOs’ are well placed to manage the recovery and are doing so by focusing on a handful of key strategies that set them apart from the rest:
1. Hyper-empathy: Developing superior consumer intelligence
2. Hyper-agility: Rapid development of new messaging, products and services
3. Hyper-collaboration: Integration across all elements of the marketing mix
4. Hyper-consolidation: Building resilience across brands and through M&A
5. Hyper-transparency: Ensuring purpose permeates all aspects of the business
Frontier CMOs are also significantly more likely to be accountable for digital transformation than other CMOs, proving their value and impact to company boards as they navigate the future of their business and industry.
The study ‘Into the Unknown’ by Dentsu finds that CMOs are reclaiming their strategic agenda with particular focus on product development, calls out Frontier CMOs who are doing things differently.