Marketing News: January 2019

AMERICAN MARKETING ASSOCIATION

AMA.ORG

JANUARY 2019

2019 MARKETING PREDICTIONS

WHY AREN’T THERE MORE MARKETERS AT THE BOARD LEVEL? STEPPING THROUGH THE GAMER GATEWAY JANUARY 2019 NO.

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table of contents AMERICAN MARKETING ASSOCIATION

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ANSWERS IN ACTION • Snapshot • Core Concepts • Ethical Marketing

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SCHOLARLY INSIGHTS • Marc Mazodier, Conor M. Henderson and Joshua T. Beck

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EXECUTIVE INSIGHTS • Lawrence A. Crosby • Keesa Schreane • Vikas Mittal • Russ Klein

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28  Dream Less, Do More: 2019 Marketing Predictions

We’re closing the book on a decade marked by digital marketing trends, influencers and AI. This final year of the 2010s means less dreaming and more implementing.

CAREER ADVANCEMENT • Budgets • Goal Setting

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#OFFICEGOALS

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 Marketer Representation at the Board Level Can Power Firm Growth. So Why Are They Underrepresented?

How can marketers grow their influence at the board level? Kimberly Whitler, a former CMO and current academic, hopes that new research can help.

 Gamer Gateway

Fortnite’s runaway success both echoed and surpassed previous gaming sensations. Could its popular multiplayer features and eyepopping jackpots help marketers get their sea legs with esports?

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JANUARY 2019

VOL. 53 | NO. 1 AMERICAN MARKETING ASSOCIATION

Bill Cron Chairperson of the AMA Board 2018-2019 Russ Klein, AMA Chief Executive Officer rklein@ama.org EDITORIAL STAFF

Phone (800) AMA-1150 • Fax (312) 542-9001 E-mail editor@ama.org David Klein, Chief Content Officer dklein@ama.org Molly Soat, Editor in Chief msoat@ama.org Sarah Steimer, Managing Editor ssteimer@ama.org Hal Conick, Staff Writer hconick@ama.org Bill Murphy, Lead Designer wmurphy@ama.org ADVERTISING STAFF

Fax (312) 922-3763 • E-mail ads@ama.org Sally Schmitz, Production Manager sschmitz@ama.org (312) 542-9038 Nicola Tate, Associate Director, Media Channels ntate@associationmediagroup.com (804) 469-0324 Joseph Petit, Recruitment Advertising Specialist joseph.petit@communitybrands.com (727) 497-6565 x3706 Marketing News (ISSN 0025-3790) is published monthly except June/July and November/December by the American Marketing Association, 130 E. Randolph St., 22nd Floor, Chicago, IL 60601.

Circulation: (800) AMA-1150, (312) 542-9000 Tel: (800) AMA-1150, (312) 542-9000 POSTMASTER: Send address changes to: Marketing News, 130 E. Randolph St., 22nd Floor, Chicago, 60601-6320, USA. Periodical Postage paid at Chicago, Ill., and additional mailing offices.

LETTER FROM THE EDITOR

The Year Ahead

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ear-ahead predictions are a dime a dozen, especially in the marketing space.

Data troves are growing!

Holograms are coming! Bots are taking over! But the AMA is here to bring predictions back to reality. This year, we encourage you to take on bite-sized challenges that will affect your work immediately.

We all know that artificial intelligence is here to stay—but what does AI really mean, and how can marketers use it daily? Staff writer Hal Conick breaks down the steps marketers can take right away to incorporate artificial intelligence into a marketing strategy. (Hint: Cut out the guide on page 11 to keep those tactics handy and impress your boss with your applicable knowledge of AI.) Managing editor Sarah Steimer spoke with experts that span marketing disciplines to find out what they’re

planning for 2019. “This final year of the 2010s means less dreaming and more implementing,” Steimer writes.

What are your tactical goals for 2019?

MOLLY SOAT Editor in Chief @MollySoat

Canada Post Agreement Number 40030960.

Opinions expressed are not necessarily endorsed by the AMA, its officers or staff.

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ZACH BROOKE

KERI WITMAN

Zach Brooke is a former AMA staff writer turned freelance journalist. His work has been featured in Chicago magazine, Milwaukee Magazine, AV Club and VICE, among others.

Follow him on Twitter @Zach_Brooke.

Keri Witman is CEO of Cleriti and an active contributor to Forbes.com as a member of the Forbes Agency Council. She has been a panelist on the selection committee for TEDx Cincinnati, has performed stand-up comedy at The New York Comedy Club and was a fundraising mentor for New York City’s Leukemia & Lymphoma Team in Training.

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Dozens of Brands Have Changed CMOs in 2018

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pencer Stuart, an executive search and leadership consulting firm, calls 2018 “The Year of the CMO

Shuffle.”

The year has been extraordinary for CMOs, the group says, and not in a good way.

“An usually high number of wellknown brands that we track across a number of key industries have undergone a change in the top marketing role this year,” says a Spencer Stuart blog post.

Greg Welch, global leader for the consumer goods and services practice at Spencer Stuart, says that the reasons why CMOs are moving vary by company, but the most

popular answer he hears is that CEOs want more growth. These CEOs now have mandates that require marketing leaders who drive sales; creative ads aren’t enough anymore, the CEOs want sales.

“This seems to be more and more prevalent,” Welch says via email. “And as for why they leave, it is a mixed bag. Many of the companies listed on our chart had change because they initiated the change, but many of them are then linked.”

One example Welch gives is Potbelly recruiting Papa John’s Pizza CMO, which then forced Papa John’s to hire a new CMO. Spencer Stewart’s websites gave some other reasons why CMOs may

be leaving en masse, including: • Poor CEO-CMO alignment.

• Inflated expectations for CMOs. • No clearly defined priorities for CMOs. • Little recognition of the challenges CMOs face.

• Industry consolidation.

The company says that there’s now a “new breed” of disruptive CMOs emerging who are creative and compelling communicators committed to learning and teambuilding.

“Now more than ever, marketing leadership needs to band together and solve this (hopefully) short-term dilemma,” the post says.

—HAL CONICK

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7 Competing Tensions of Marketing Leadership Leadership is making the decision to be intentional, mindful and to exercise personal accountability

‘T

he leadership balancing act is very personal,” says Jessica McWade, president of McWade

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Group, speaking at the AMA’s Symposium for the Marketing of Higher Education. What makes it so hard is the struggle to not be too critical to the self.

Context matters: You may be a perfectly wonderful leader, but you may not be successful if you’re in the wrong job; on the other hand, you may be an OK leader, but thrive in just the right environment. There are variables to figuring out yourself and your fit, McWade says.

She outlines what she calls the seven competing tensions of leadership.

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Managing ourselves while leading others

Channel your inner flight attendant: Tend to your emotional intelligence before tending to the needs of others.

This requires self-awareness, self-regulation, introspection, listening and open body language. Joel Seligman, associate VP for strategic communications at the University of Maryland, acknowledged that some institutions often fail to create a culture of self-awareness and introspection.

Soft skills can be the hardest skills to foster, McWade says, because of the raw messiness of human nature. Questions to develop your own emotional intelligence readiness include: • What leadership traits do I admire?

• Who are the leaders I admire and why?

• Do I possess what I like about these traits and leaders?

• If not, why not? What work should I do to close these gaps?

• How do I think my team and my bosses perceive me as a leader?

• What evidence do I have to know how they perceive me?

Are there gaps between my self-perceptions and those others have of me?

• Have I read about emotional intelligence and tried to apply the lessons?

“We’ve all worked with people before who are not aware of their leadership style, so having that ability to realize where you need help [is important],” Seligman says. He also emphasized the importance of moving from owned leadership to earned leadership; what got you the leadership role may not be what makes you a good leader, and it’s something that needs to be cultivated.

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Balancing advocacy while serving with humility

The boss who thinks that he or she knows it all isn’t going to grow, nor is the team, McWade says. Professional development also means being willing to search for the answer and not always insisting you know it.

• If you lead the central, institutional communications and marketing function, remember that it’s a reciprocal, two-way street with the schools, colleges and other campus partners.

• Emotional intelligence is key to navigating these politics, particularly at very decentralized institutions — tone matters.

• People need to recognize that sometimes you must engage in top-down, last-minute primacy.

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Calibrating dissenting political views

• Have an early warning radar in place to know what’s coming.

• Earn access into decisionmaking before somebody does something in poor taste, such as inviting the wrong person to speak on campus.

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Be responsive externally while dealing with the organization’s internal pace • Diagnose your situation and find areas where you can speed up.

• Focus on speeding up the right things, not everything.

• Build trust in your personal working relationships.

• Get to know your legal and financial teams and other key players.

• Illustrate how rival and peer institutions earn competitive advantage by being early to market with programs, creative or crisis response.

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Be open to new learning

• Everyone talks about lifelong learning, but are you open to new ideas or are you set in your ways?

• Effective leaders are great teachers, but they’re also unafraid to show that they’re learning to ask questions and to make sure they are seen as learning from their own people.

• There is an attractive, magnetic humility in not pretending to have all the answers all the time.

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Talking strategy while pursuing one that’s actually enacted • Create a written plan with codified, prioritized objectives and strategies.

Socialize it with all the right players.

• Apply objective, marketbased evidence to the development of your plan.

• Measure what matters most: Are you focused on strategic metrics of awareness, attitudes and intentions to act or specific management and advancement objectives?

Or are your measures more of a tactical or process nature, such as social media interactions?

• Take time with your people to review your progress implementing the plan.

• Embed your key objectives and strategies into your performance management system.

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Leading intuitively while measuring objectively

Learn over time that the subjective and the objective must work together. Pull from each domain as needs and context warrant. Be introspective.

—SARAH STEIMER

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SNAPSHOT

revolutionary, but she had no idea how they’d pull it off. Who would they work with? Were local municipalities even interested in taking money for potholes, money that historically comes from public funds? She had no clue.

Domino’s Smooths the Customer Journey by Paving Roads Domino’s wants to pave roads to make its customers’ journey to buying pizza easier. Has their infrastructure-based advertising paid off?

BY HAL CONICK | STAFF WRITER

 hconick@ama.org Goal People hate potholes. Drivers dislike being surprised by mid-road jolts and hate fixing the all-too-common damage to their vehicles—the American Automobile Association reports that potholes cost U.S. drivers an annual average of $3 billion in repairs. And just think of how all those bumps in the road could ruin mid-transit pizzas!

OK, drivers don’t likely think much about how potholes might ruin their pizzas, but the advertising team at Domino’s Pizza has. Crispin Porter + Bogusky, Domino’s advertising agency of record, suggested that the pizza chain ask customers what roads in their area needed repairs. CP+B pitched that Domino’s would give a grant to the municipality in charge of maintaining that road, then use the repairs as the backbone of an infrastructure-based

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advertising campaign.

“The first time I heard the idea, it was obvious to me that it really was a breakthrough, unique idea that would resonate and demonstrate our obsession and passion with pizza,” says Kate Trumbull, vice president of advertising at Domino’s Pizza.

Trumbull says that the Domino’s ad team saw pothole repair as an opportunity to ease their customers’ journey—after all, why should a bad road get in the way of good pizza? It also fit with the company’s previous campaign: Domino’s had given customers “carryout insurance” on their pizzas. Domino’s replaced ruined pizzas— whether damaged by potholes, a ravenous dog or a slip-and-fall accident—so long as the customer returned the cheesy remains.

Trumbull says that the idea of taking customer requests for road repairs was

Action Before launching the campaign, Domino’s and CP+B cold-called municipalities to see if they’d be interested in road-repair grants. The duo became familiar with the winding-but-staid nature of working with local government; sometimes, they’d find the right person on the first call, other times it took multiple callbacks, passforwards and long games of phone tag.

“It can test you and test your patience,” Trumbull says. “But getting those early confirmations that this could work really motivated the team to keep pushing.”

Trumbull realized that many local governments were as excited by the idea as she was. Cities with small budgets seemed especially thrilled: “They really wanted to work with us and make it happen,” she says. Some governments had no interest, but Trumbull heard enough positive responses that she became more excited by the idea. The campaign would help the company sell more pizzas and drive brand buzz, she believed, but it would also be uniquely engaging.

“We want consumers to know no other brand loves pizza more than we do,” Trumbull says.

In late 2017, Domino’s began work on its Paving for Pizza campaign. Domino’s awarded grants to four cities that it had cold-called. On Dec. 12, 2017, road crews paved eight potholes across three roads in Bartonville, Texas, the first city to be awarded a paving grant. The crew used a road roller branded with a Domino’s sticker—a video filmed by Domino’s shows the roller moving backwards to reveal a branded stencil with the company’s logo and the tagline, “Oh yes we did.” Then, in March, Domino’s awarded a grant to Milford, Delaware, where crews repaired 10 roads. In April, crews in Athens, Georgia, repaved 150 square yards of failing roadway.

On June 11, 2018, Domino’s sent out

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a press release and launched a microsite where customers could submit requests for roads in their area that needed repairs.

The website also served as a place to show off successfully paved roads, as well as statistics and reactions. Stephen Bailey, the program development coordinator of Athens, is quoted on the Paving for Pizza microsite as saying that this grant was “certainly a new type of opportunity for us.”

Within the first week, customers sent in 47,197 nominations for repairs.

Then, social media exploded with chatter and Trumbull’s phone glowed and buzzed. “My mom called me, my aunts and uncles were texting me,” she says.

“People are just like, wow, Domino’s is seriously doing this?”

Although Domino’s ad team was excited, they kept their media budget steady throughout the campaign. They’d reach out to franchisees to let them know that they had given a paving grant in their area, Trumbull says, and franchisees would often send their own press releases or bring pizzas to the road crews. But after the initial press releases and ads, the campaign spread most successfully by word of mouth.

“People bring it up with me,” Trumbull says. “‘Are you guys really paving?’ And when you hear that, something has really struck a chord.”

Result In Andrew Essex’s 2017 book, The End of Advertising, he touted an infrastructure advertising approach as the future of ads.

Essex, who currently serves as CEO of marketing company Plan A, had simple reasons: Print ads haven’t worked in 20 years, TV viewers see commercials as more annoying than informative and internet users can wield adblockers to rid their screens of pop-ups and sidebar ads. His main point: Companies need to get creative and push beyond all-toofamiliar ads or risk becoming irrelevant.

It’s no surprise, then, that Essex had nice things to say about Domino’s campaign: “Absolutely brilliant,” he says. “Anytime that you can find whitespace or surface that isn’t mediated into a communication

COMPANY

Domino’s Pizza FOUNDED

1960 HEADQUARTERS

Ann Arbor, Michigan CAMPAIGN TIMELINE

First roads paved in late 2017, campaign launched in June 2018, last roads likely to be paved in Spring 2019.

CAMPAIGN RESULTS

1.1 billion traditional media impressions, 500,000 hits to the microsite, 170,000 nominations from 16,000 unique zip codes for roads to be paved, 11 towns paved as of November 2018 with 20 more reviewing the grants.

channel, you’ve done something brilliant.”

Brilliant campaigns get brilliant results: Jenny Fouracre-Petko, Domino’s director of public relations and charitable giving, says that the campaign received 1.1 billion traditional media impressions from its launch in June 2018 through November.

answers in action

Trumbull says that during that same period, the microsite drew 170,000 nominations for road repairs from 16,000 unique zip codes. The microsite itself received 500,000 hits during that time.

Trumbull says that the company doesn’t share sales data, but simply called the results “strong and successful.”

Domino’s has continued to give grants for road repairs. As of November 2018, Trumbull says that they’ve given grants to pave 11 towns, with 20 more local governments reviewing grant agreements.

Domino’s even decided to give grants to municipalities in all 50 states; Trumbull hopes to see the last roads paved by Spring 2019, at latest.

Outside of success metrics, Trumbull says that the excitement generated by the campaign was unique. She had no idea people would get so passionate about a paving campaign; franchisees started matching Domino’s donations to pave roads and Trumbull even received pictures of people dressed as a Domino’s road crew for Halloween.

“It’s exceeded expectations,” she says.

While the Paving for Pizza campaign finished at the end of 2018—save for some straggler roads still to be paved— Trumbull hopes that Domino’s can create more campaigns that address friction points in the customer journey.

“For us, this wasn’t about infrastructure; this is really about pizza,” she says. m

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CORE CONCEPTS

How Marketers Can Start Adopting Artificial Intelligence Tomorrow Many companies are piloting artificial intelligence, but few know what it is or how to use it. Here’s how marketers can adopt AI now—and do it well.

BY HAL CONICK | STAFF WRITER

 hconick@ama.org

P

aul Roetzer couldn’t stop watching.

It was 2011 and Watson, a thennew IBM supercomputer, faced off against 74-time “Jeopardy!” champion Ken Jennings and the show’s all-time money leader, Brad Rutter. Watson, a question-answering artificial intelligence system, would buzz in within a second of host Alex Trebek asking a question, giving what the AI determined to be the most probable answer. By the end of the game, Watson had dominated the show’s all-time greats by more than $50,000.

By late 2016, Roetzer had become so obsessed by AI’s potential in marketing that he founded the Marketing Artificial Intelligence Institute, a group with the mission of making AI approachable and actionable for modern marketers. Roetzer still runs his company, PR 20/20, but he says that his AI group now takes nearly all his time. He badly wants to figure out how organizations can pilot and scale AI tools to increase efficiency and reduce costs.

So far, he has nearly the entire marketing industry to work with.

“The vast majority of the industry is at what I consider the pilot phase,” he says.

“Most are trying to understand what AI is, then how to apply it.”

A 2018 report by Boston Consulting Group and MIT Sloan Management Review—titled “Artificial Intelligence in Business Gets Real”—finds that only 18% of companies are “pioneers,” or organizations that understand and have adopted AI. A third of companies (33%) are “investigators” that are in the pilot

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stage and know a bit about AI, while 16% are “experimenters” that are piloting AI without fully understanding it—they hope to learn about AI as they use it. The rest (34%) are “passives,” or organizations that haven’t adopted and barely understand AI. Over the past few years, many marketers have marveled at AI and wondered the same thing Roetzer did after watching Watson dominate its fleshy opponents: How does that work? As 2019 begins, marketers can move beyond passivity and into being AI pioneers.

Learn Now Like Roetzer, Robert Redmond watched “Jeopardy!” in awe as Watson dominated the show’s legends. Redmond, a selfdescribed sci-fi geek, had been hearing about AI since he was a young boy, but the AI’s game-show performance was a glimpse at the technology’s capabilities.

At the time, Redmond was working as a creative director of teamDigital Productions; by 2016, he worked at IBM with Watson Advertising as creative and strategy director. Redmond is tasked with figuring out how Watson can help brands have unique, AI-driven chats with their customers.

When Redmond first learned that he’d be working with Watson, he says that he knew close to nothing about how AI worked, especially from an engineering perspective. Redmond calls the six months leading up to working with Watson his “baptism” into AI—he was already an AI convert, he says, but he still had to fight to understand what was possible with the technology.

“I read a lot and I asked more questions than most would probably be comfortable answering,” he says. “There was a lot of ‘Can we do that?’ And the learning came by understanding the implications on the back side of those questions.”

Marketers—most of whom likely don’t fully understand AI, let alone its true potential in business—should also be asking a lot of questions. Redmond believes that businesses should learn by digging into possibilities and seeing what AI tools are available on the market. Both he and Roetzer have encountered some companies that use AI-based software without realizing it—this is likely the case for many companies searching for their first piece of AI-based software.

For marketers eager to learn about AI, Roetzer suggests reading Human + Machine: Reimagining Work in the Age of AI by Paul Daugherty and H. James Wilson and Prediction Machines: The Simple Economics of Artificial Intelligence

by Ajay Agrawal, Joshua Gans and Avi Goldfarb. “Most of the really valuable AI education has nothing to do with marketing or sales,” Roetzer says. Even so, books like these can give marketers a window into AI and its business potential.

Marketers should learn how their competition is using AI. They should also ask vendors pointed questions about the AI software they’re selling. “A lot of tech vendors are slapping ‘machine learning’ and ‘AI’ on their branding,” Roetzer says.

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✁ “A lot of times, they don’t even know what that means. The sales and marketing teams can’t explain how their products use AI. They’re just told by the engineers that it’s AI.” Marketers can also play with online AI demos to get an idea of how AI-driven tools work. Google has many educational tools on its AI landing page, Roetzer says, as does IBM’s Watson. One Watson tool— Personality Insights—allows users to log into their Twitter account and receive a personality analysis based on their tweets.

“There are a lot of resources out there, and you can connect the dots pretty quickly if you just consume the right resources and understand the ways you might be able to apply it in your business,” Roetzer says.’

Find Easy Wins and Tough Problems Companies without AI experience will likely have a steep learning curve, Redmond says. “There’s definitively going to be a training period, a modeling period, and probably a fail period if you’re stepping into a scenario where you are really starting from scratch,” he says. “It’s a difficult transition.”

Redmond and Roetzer both say that this difficult transition will make early, easy wins essential. One potential easy win, Redmond says, is using AI-based programmatic advertising tools to bid on media buys. Another he suggests is natural-language processing tools that can quickly judge the tone and intent of business communications, such as emails, memos or marketing materials. “You can discover new ways or new features that might be important that you didn’t realize or pressure points that may be bigger than you’ve been admitting,” he says. “You uncover the insights, and you can act upon them.”

The simplest way to find easy wins, Roetzer says, is to make a list of all the tasks in the business—from quick to time-consuming—and measure how much time employees spend on each task, as well as how much money the company spends on software or outside services for each. Then, marketers can

AI CHEAT SHEET FOR MARKETERS • Educate yourself with some books recommended by Roetzer: Human + Machine: Reimagining Work in the Age of AI by Paul Daugherty and H. James Wilson and Prediction Machines: The Simple Economics of Artificial Intelligence by Ajay Agrawal, Joshua Gans and Avi Goldfarb.

• Use AI demos to get a feel for what’s possible. Roetzer recommends Google’s AI landing page (https://ai.google) and IBM’s Watson website (https://www.ibm.com/watson).

• Make a list of all the tasks in a business, no matter the size, and measure how much money and time is spent on each. Rate the tasks from one to five based on how much value AI could bring.

• Plan for a training period, modeling period and, probably, a fail period.

rate each task from one to five based on how much value AI could bring. A one would mean little to no value, a five would mean a good AI solution would be transformative. Listing, measuring and rating may sound arduous, but Roetzer says that the process will give marketers an idea of AI’s potential value in cutting down time and costs.

“If you’re the director of marketing, and you’re trying to get buy-in to try this, you can go and say, ‘Hey, I went through an analysis. Here’re the five use cases where I think we create the most value,’” Roetzer says.

The C-Suite Must Buy in, Time Must Be Given Redmond normally works with companies that have a mandate from the top to adopt AI, now. The chief technology and chief information officers with whom he tends to work are focused on a problem at a high level and want to solve it with AI; that desire spreads through the rest of the organization.

But not every marketing manager will be so lucky. Roetzer says that even marketers who get the C-suite to buy into AI software often have executives quit on their AI project before it can prove its efficacy. AI systems, especially at small or midsize companies, sharpen over time and often need months to

learn—it’s hard work to get AI right, it likely won’t work right away and it may even fail during the first pilot. If a CMO adopts an AI-powered media-buying tool, for example, and it doesn’t show lift three months and $20,000 into adoption, many executives will scrap the idea of AI altogether, convinced it doesn’t work.

“It’s a hard thing to explain to the C-suite if they’re not the ones driving it,” Roetzer says. “Even at the pilot stage, there needs to be buy-in at the top level.

[They need to know] that this is going to be an ongoing experiment, and it’s going to transform everything we do. But we have to have the right investment and the right patience to see it through.”

Organizations must understand from the start that AI is not a magic switch, Roetzer says. Companies can’t just expect to adopt AI and—poof!—solve all their problems. Adopting AI is a lot of work and requires a lot of data to train its models; it takes a lot of strategy to prioritize what cases are helped by AI and what cases should be left for another day. “Some people may give up too easily,” he says.

Although Roetzer knows that it may sound as though he’s trying to scare people away or downplay AI’s potential, he believes that marketers who properly adopt AI will be given “superpowers.” “It’s going to fundamentally change the way we do marketing,” he says. m

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ETHICAL MARKETING

(T)apping Into Consumers’ Ethics

intersection of mobile product research and ethical consumption. These platforms, which are typically crowdsourced, enable consumers to make in-the-moment decisions on which brands to support and which to spurn.

Ethical consumer apps help shoppers make informed decisions about which brands to support

BY SARAH STEIMER | STAFF WRITER

 ssteimer@ama.org

M

arketers have known that consumers use their mobile phones for research when shopping, to compare prices or check

availability. Marketers also know that consumers give preference to socially conscious and eco-friendly companies.

App-makers have tuned into the the

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ENVIRONME

ANIMAL WELFARE

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What are ethical consumption apps and how do they work?

Ethical consumption apps allow consumers to quickly and easily see what brands align with their personal causes.

One of the most popular consumption apps is Buycott, which prompts users to join campaigns to support different causes, such as animal rights, green energy or ending child labor. Consumers can scan product barcodes and learn more about how the company aligns with their chosen causes. There are options to view alternative products that better relate to a user’s chosen causes, share information about a product or company across social channels, see what other users are boycotting and communicate your decision to the company.

A 2018 study published in Consumption Markets and Culture explored how these apps motivate their users. Christian Fuentes of Lund University and Niklas Sörum of the University of Gothenburg studied three ethical consumption apps, finding they work in two core ways to enable and reinforce ethical consumption. First, the apps put pressure on consumers by making consumption ethically problematic. Ordinary consumption is considered inherently moral because it’s shaped by values such as caring for others, but the process of ethicalization rearticulates a person’s moral code every day. Put even more simply, the apps place a filter over the daily consumer landscape and show how almost every action can be an ethical dilemma. The apps also problematize everyday life by linking consumption with the consumer’s identity and status.

Second, ethical consumption apps don’t just point out problems, they empower consumers to act ethically. The app provides the research, often through

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crowdsourcing, which gives consumers the information they need to make ethical decisions. It’s also a platform to share decisions, find alternative solutions and reach out to companies.

“The apps we studied provide consumers with databases containing sustainability information aimed at assisting them in making their everyday consumption more sustainable,” Fuentes says. “The apps were designed to assist consumers, providing them with the information they need, when they needed it.”

What these apps mean for marketers Fuentes says that the problems being addressed by ethical consumption apps relate to both the complexity and transparency issues inherent to marketing. The apps address consumer concerns of being misled by company claims. “[L]ots of companies are still hiding behind obscure, sugar-coated claims, or not saying anything at all,” says Sandra Capponi, head of business development and co-founder of the ethical fashion shopping app Good On You. “Greenwashed marketing just won’t cut it in the eyes of the consumer anymore. Besides, it can really hurt a brand when consumers find out that these messages contradict the truth.”

Greenwashing is one of the more notable examples of how marketing can mislead consumers. It refers to the when a company spends more on advertising its eco-friendly business activities than on actually helping the environment. Unfounded claims are also a prevalent practice in food marketing; some food brands use labels such as “natural” that are generally considered meaningless because their usage lacks any governance.

The apps act as sort of a check on marketing claims. Of course, as Fuentes explains, “no information is neutral. In selecting information and framing it in a specific way, these apps are also defining sustainability or ethicality in a specific

answers in action

Every time someone buys from a betterrated brand, they’re sending a clear message to the industry to be more transparent and accountable for their impact. That has consequences across the entire value chain from sourcing and manufacturing to distribution and—of course—marketing. way and pushing this definition and framing onto consumers.” Marketers can use the apps to determine which causes motivate consumers, but they can’t just claim it, they have to prove it.

“Every time someone buys from a better-rated brand, they’re sending a clear message to the industry to be more transparent and accountable for their impact,” Capponi says. “That has consequences across the entire value chain from sourcing and manufacturing to distribution and—of course— marketing. Unless marketers respond, their brands and their products will be left behind in the eyes of customers.”

Good On You works with more than 60 ethical brands to help them share their stories and promote their products.

“Essentially, we offer these brands content marketing services,” she says. The app company recently worked with retailer C&A to launch their sustainable jeans, as well as with Patagonia on a campaign to secure World Heritage protection for Australia’s Tarkine rainforest.

“We also work with multi-brand retailers to help them understand the ethical performance of their portfolio, choose which brands to stock and communicate their ethics,” Capponi says. “Many retailers are starting to use the ‘Rated Good On You’ stamp to promote their most sustainable brands to customers.” It’s an ethical marketing tool that could give companies a lift among ethically conscious shoppers.

Promoting your brand’s ethical choices speaks to another growing trend: buycotting. Rather than boycotting, buycotting involves spending money to support companies that consumers agree with. A report from Weber Shandwick surveyed 2,000 U.S. and British consumers who had taken at least one of nine actions (ranging from sharing a social post about a company or brand to participating in demonstrations) in response to what a company or brand did.

The survey found that 83% said that it was more important than ever to support companies they believe “do the right thing” and buy from them, compared with 59% who said that it was more important to participate in a consumer boycott.

Getting on the good side of ethical consumers may require a deeper dive into supply chains, but brands that are conscious of social, economic, environmental and other issues can drive sales by making those stances and practices transparent. The more consumers are aware of those positive efforts, the better the reviews on these crowdsourced apps. Marketers can think of ethical consumer apps as the Cliffs Notes version of their company’s sustainability report, available at customers’ fingertips. Research points to consumers being motivated to support do-gooder brands; ethical actions are opportunities to draw customers willing to vote with their dollars. m

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SPONSORSHIPS

One Easy Way to Increase ROI from Sports Sponsorships Brands spend big money sponsoring sports because of its mass-market appeal and global audience. However, they may be under-investing in a group that’s potentially the most profitable: out-of-market fans.

BY MARC MAZODIER, CONOR M. HENDERSON AND JOSHUA T. BECK

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he global sports market posts double-digit revenue increases each year, soaring to $90.9 billion in 201​7. It’s an industry characterized by

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big-dollar stars, passionate fans and high buy-in. The NFL, for example, notched sponsorship revenues of $1.32 billion for the 2017-2018 season and its games on

average command $134,009 for 30-second ad spots. Sponsors pay the high fees to gain mass-market visibility in a world of fragmenting media channels. They connect with fans via advertising, events and merchandise, but often favor local fans with whom they can build a more immediate connection.

Given the big money involved for sponsors, our new study, published in the Journal of Marketing, seeks to understand the impact of sponsorship on a little-studied group: out-of-market, or isolated, fans. It’s a timely topic because TV and digital media have helped grow a global fan base. In soccer, 80% of the British Premier League fans live outside of the U.K., one reason Chevrolet’s $560millon sponsorship of Manchester United specifically targets out-of-market fans.

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However, industry experts say as much as one-third of sponsorship budgets are wasted and only half of TV viewers can recall a sponsor of NFL games. So how can sponsors connect with out-of-market fans and determine their ROI? Our research team posited that sponsorship effectiveness depends in part on where strong fans live relative to other fans. Based on an affiliation theory of sponsorship, which argues that sponsorship works by satisfying a fan’s affiliation needs, we predicted that fan isolation—or the experience of feeling separated from the team community—would trigger different affiliation motives and responses based on the level of fan identification. Specifically, we hypothesized that strong fans would seek team-based affiliations, whereas weak fans would affiliate with others in their immediate social environment. These different affiliation strategies should result in isolated strong fans being more receptive of brands that support their team (a “doublingdown” effect), whereas isolated weak fans would avoid brands that supported the team (a “desertion” effect).

To test this hypothesis, we studied 1,412 fans across three countries and three sports.

We used two field studies to evaluate the effectiveness of real sponsors and four experiments to test the impact of real and fictitious sponsorships. Sponsorship performance was measured by a fan’s memory, attitudes, word-of-mouth and purchase intentions for sponsor brands.

Key findings Include: • Isolated strong fans exhibited increased memory, attitudes, word-of-mouth and purchase intentions for sponsors. Isolated weak fans revealed the opposite behavior.

For example, in our study of Premier League fans, more-isolated strong fans recalled the team’s brand sponsor 68% more than less-isolated strong fans.

Similarly, when we studied fans of the NBA’s Los Angeles Lakers, isolation resulted in a 22% increase in brand sponsor purchase intention and wordof-mouth for isolated strong fans, but an 8% decline in purchase intentions and a 9% decline in word-of-mouth for isolated

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weak fans.

• In other experiments, when the strongest fans were made to feel more isolated, they exhibited 46% better unaided recall of the sponsor brand, 38% more favorable attitudes and 91% greater likelihood to choose the sponsor brand instead of a competitor.

• A single exposure to a brand sponsorship advertisement for isolated strong fans is as effective as multiple exposures to the brand sponsor advertisement for all other fans.

• The work advances an affiliation theory of sponsorship, showing that sponsorship works because of the desire for affiliation, a desire that increases for strong fans when they are isolated from other fans.

Sponsors have traditionally targeted the strongest local fans with advertising dollars.

Our research indicates that sponsors should instead prioritize a group that has been commonly ignored: strong fans that are out-of-market and more motivated to buy team goods and products from sponsors. In the digital era, companies can accomplish this goal by microtargeting fans by audience location and interests on social platforms such as Facebook, YouTube, Twitter and sports sites.

Marketers can use our research to spend advertising dollars more effectively. For example, it may drive more ROI to allocate a good portion of advertising spend to digital advertising targeting out-of-market fans rather than paying for individual 30-second TV spots. Sponsors can cultivate a digital fan base they can market costeffectively, deepening loyalty and driving revenue with each offer. But they also need to take care not to antagonize isolated weak fans, whose loyalty may also grow over time. m

Sponsorship works because of the desire for affiliation, a desire that increases for strong fans when they are isolated from other fans.

MARC MAZODIER is associate professor of marketing, Zayed University, and affiliate professor, Kedge Business School.

CONOR M. HENDERSON is assistant professor of marketing, Lundquist College of Business, University of Oregon.

JOSHUA T. BECK is assistant professor of marketing, Lundquist College of Business, University of Oregon.

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DEMOGRAPHICS

Marketing Faces Shifts in Technology, Demographics in 2019 The future isn’t a constant, nor are marketing trends. Prepare for changes in technology, demographic trends and even your marketing teammates.

BY LAWRENCE A. CROSBY

 lawrence.a.crosby@gmail.com

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he beginning of the new year brings out the futurist in all of us, and columnists such as myself are asked to share their visions. I should caveat this by saying that I’ve been spot-on in my past predictions only once. The second paper I ever wrote as an academic, in 1979, was “The Role of Microcomputers in Marketing,” in which I forecast significant changes to marketing tasks as the result of this embryonic technology. I was right about that.

Technology will no doubt continue to change marketing, affecting customers’ lives and our work. But there’s a lot of hype out there; marketers need to be careful of where to place their technology bets—not every idea is destined to become the next microcomputer revolution. The rollout of enterprise resource planning and CRM systems have been somewhat notorious in this regard over the past 10 to 20 years, resulting in numerous lawsuits. Part of the promise behind these systems was (and still is) an enhanced customer experience by way of a holistic view of the customer relationship, improved communications, enhanced customer service, as well as faster and more accurate order and fulfillment. Despite multimillion-dollar investments in these systems, more than 20% are considered an outright failure.

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Your firm and many others are no doubt exploring or actively pursuing technology trends such as Big Data, artificial intelligence, Internet of Things, blockchain, mobile payment, 3D printing or augmented and virtual reality. But where should you double down? What technologies will benefit your customers the most?

This was a hot topic at the recent Compete Through Service Symposium presented by Arizona State University’s Center for Services Leadership. At the event, Sherry Sanger, SVP of marketing at Penske Truck Leasing, said that her company vets new technology by reviewing the public buzz around the technology, defining key terms, identifying the players, clarifying the

vision, defining the tailwinds driving positive sentiment and pinpointing the headwinds yet to be overcome. Every firm could benefit from being so deliberate and thoughtful.

I also predict that the next great challenge for marketers will be demographics. The aging population, reduced fertility rates, slowed wage growth, increased ethnic diversity and other demographic trends will change the answers to those classic questions: Who buys? What do they buy? and Why do they buy? Just as important: Where and how do they buy? What does that say about channel? Conventional place-based retailing is in trouble and the demise of Sears may be just the beginning. The mobile phone is today’s 24/7 store. Young grocery shoppers order online and expect immediate home delivery.

It’s about choice, too. Why visit Sports Authority with only two choices for knee pads when you can choose between dozens of user-rated brands online? With the power increasingly shifting to the consumer, survivors will need a crystal-clear value proposition more than ever.

There’s also the supply side of demographics. Most baby boomers working in marketing have already retired or are near retirement. Many have degrees and 40-plus years of experience, making their loss a significant brain drain. At the same time, undergraduate enrollments have leveled. How this will play out in the marketing talent pool is unclear but worries me, even though

While there’s a growing interest in data analytics, there’s more to marketing than numbers. Understanding the principles and frameworks of marketing is essential to asking the right questions and making the right decisions.

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business remains the most popular undergraduate degree. At the graduate level, there’s a shift from the MBA to specialized master’s degrees where marketing is underrepresented. While there’s a growing interest in data analytics, there’s more to marketing than numbers.

Understanding the principles and frameworks of marketing is essential to asking the right questions and making the right decisions and interpretations of the data. Coding skills are not a substitute for

understanding.

Firms may find it difficult to keep and grow the talent they already have. As Peter Drucker said, we’ve entered the era of the “knowledge worker,” people who think for a living. In addition to being self-directed, autonomous and creative problem-solvers, they are often more attached to their field than their firm.

These valuable assets can easily walk out the door.

Beyond technology and the changing

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nature of demand, my crystal ball says that the management of human marketing resources will be among the field’s greatest challenges in the years to come. m LAWRENCE A. CROSBY is the retired dean of the Drucker School of Management and currently the chief data scientist at the KH Moon Center for a Functioning Society, part of the Drucker Institute at Claremont Graduate University.

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COMPASSIONATE MARKETING

3 Steps to Becoming a More Compassionate Marketer Three actions can help companies leave a lasting impression on customers

BY KEESA SCHREANE

 daaker@prophet.com

I

’ve never watched NBC’s “This is Us.” (If you want to know what it’s like to live and work on a deserted island, try being detached from one of America’s most drama-filled network phenomena.) Yet the comforting thing about “This is Us” and other popular shows is that I don’t have to be a loyal watcher to keep up. There is no need to tune in, pull up or click on a single episode to stay looped in on the latest dramatic twist and turn because audiences are talking about it. More importantly, my people—my community, my crew—are all talking about it.

Slack messages, memes, huddles and pre-Super Bowl tweets conspire together to provide me with all the threads I need to weave coherence around the trials and tribulations gripping “This is Us” characters.

And I’m here for it—so much so that I’m toying with the idea of actually becoming a viewer.

Author Seth Godin might call “This is Us” remarkable. The characters emote vulnerability, the storylines resonate broadly and the writing tugs at our heartstrings. Viewers feel so connected to the show that they tell their friends and loyally tune in for new episodes every week (or over the weekends, if binging).

As a marketer and business growth

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practitioner, I aspire to get people talking about my brand and my services and what makes them so unique. I’m grateful that remarkability isn’t reserved for a great drama. Athletic wear, financial services, personal hygiene products and even basic water can be remarkable to customers who research, buy, consume and effuse about the items to their family, friends or colleagues.

What characteristic can a business, brand or individual display to be considered remarkable? Compassion.

I’m drawing from my discussions with industry leaders and visionaries on my podcast. In my recent “You’ve Been Served” podcast interview with Seth Godin, he explains how we can incorporate remarkability into our businesses.

These three actions capture how firms and individuals can improve their compassionate practices and leave a lasting, remarkable impression on customers.

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Identify your personal mission Start by understanding what matters most to you and how you want to make a difference. Waking up every day with clarity about what we want to bring to our life, environment and community helps ensure we take

daily steps toward achieving those high-level goals. “If we commit to something that matters and show up, show up, show up until we make an impact, that’s a life well lived,” Godin says.

I wake up every day with a specific intention and I continue to affirm it throughout the day. For example, if I commit to a day of giving, I engage by giving a smile or a genuine compliment to people I meet. Or I may find a unique way to support a colleague on a project. Each day is a commitment to the broader mission of compassion.

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Seek opportunities to show compassion in every aspect of your work Godin believes there are many opportunities in our professional lives to show compassion: “The best work we do, the biggest contribution we make is in the moments when there is no right answer, when there’s no obvious path. Most people have trouble when they refuse those moments.”

When we run into a colleague who isn’t having the best day or a customer who is distracted due to personal issues, we should share a kind word or let them know that they’re in our thoughts. Sometimes the greatest impact comes from spending a few moments listening to them. This may go against old-school professionalism, but listening is a way to show empathy and build more powerful relationships.

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Know what matters to customers and support them beyond selling When you align your resources to support causes and organizations that your customers hold dear, it speaks volumes about your firm’s compassion and gets customers talking about you.

The simplest way to identify your customers’ needs is to do a social search. What issues are they most frequently tweeting about? What

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Supporting your customer includes volunteering with an organization your customer donates to or using your social platforms to share thoughts about issues important to your customers.

organizations are they fundraising for?

How are they spending their volunteer hours?

“Be generous with your ideas, spirit and connections and your presence,” Godin says. Support doesn’t need to be monetary. Supporting your customer includes volunteering with an organization your customer

donates to or using your social platforms to share thoughts about issues important to your customers.

When businesses improve their compassion beyond a product or service, it shows care to the customer.

It shows the customer that they matter.

Customer word-of-mouth will spread, and it positions the company well in

a crowded marketplace. We become remarkable in the customer’s eyes. m KEESA SCHREANE is host and executive producer of the podcast “You’ve Been Served.” She is a featured columnist in Essence, Latina and Black Enterprise magazines and an on-air contributor with NASDAQ.

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PERFORMANCE INDICATORS

How to Use Customer Performance Indicators to Align Your Strategy Aligning external and internal performance indicators can guide strategic plans

BY VIKAS MITTAL

 vmittal@rice.edu

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few years ago, I worked with a school district that monitored more than 200 KPIs they deemed essential to strategic success: achievement gap, school climate, parent engagement, teacher turnover, student turnover, technology adoption, hours of teacher training and an index of school disciplinary placements, to name a few. The school superintendent’s bonus was based on progress on each of these performance metrics. There were only two problems: First, the district had not been able to robustly measure all 200 KPIs for the past 10 years. Second, the school board could not agree on a few KPIs to focus on.

The district leaders were also divided

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on what measurements mattered. The human resources department stressed teacher training and school climate even though it could not track the different training programs at each school or measure school climate. Worse, they could not quantify the impact of teacher training or school climate on student learning. The marketing group felt that the district needed a better parent engagement strategy, yet it had measured parent engagement five years before by surveying only a few parents in a town hall meeting. The chief academic officer claimed that SAT scores, percent of students meeting academic standards and achievement gap among minority groups were the only outcomes that mattered.

The operations/logistics department proposed metrics related to on-time pick-up of students and nutritional value of food served in the cafeteria. Not to be outdone, the chief technology officer touted the number of classrooms with high-speed internet access as the focal metric.

Exasperated, school board members asked the same question every year: What KPIs do we need to implement a meaningful strategy? They were drowning in a sea of metrics.

Similarly, an industrial company with $9 billion in sales was tracking more than 500 metrics—cost per day, project scheduling delays, safety performance and some metrics that no one in the company could explain. The plethora of metrics left leadership beleaguered. Regional presidents maintained their own metrics, which created even more confusion for the C-suite. What should be the company’s focus? What are the few key things that it could and measure?

Metrics Mania Why do well-meaning organizations end up with an unmanageable list of metrics that prohibit senior leadership from focusing on the right KPIs? It’s often because senior leaders are too focused on internal capabilities that make them more efficient and reduce cost. In this process, they tend to ignore external capabilities that satisfy customer needs and grow sales and revenues. Strategic alignment occurs when the firm’s internal capabilities

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mirror its external capabilities.

Companies can measure external capabilities through customer performance indicators (CPIs).

CPIs track the firm’s ability to satisfy customers and increase cash flow through recommendations, customer retention, increased sales, cross buying, reduced operating costs and positive word-ofmouth. In contrast, internal capabilities are tracked through KPIs that are based on specific behaviors and outcomes for which employees can be held accountable.

Successful organizations develop KPIs that mirror their CPIs. What Are Customer Performance Indicators?

• Satisfaction CPIs: A systematic survey of customers on an annual or bi-annual basis can measure overall customer satisfaction and satisfaction with key strategic areas that drive overall satisfaction.

• Loyalty CPIs: Loyalty CPIs measure customers’ intentions to engage in behaviors that will benefit the organization, including intention to recommend the company to friends and family, intention to talk about the organization and intention to repurchase the brand’s products.

• Financial CPIs: The three most widely used financial CPIs include customer retention, revenues and margins measured at the customer level.

CPIs should monitor trends across different business units (such as schools, regions, divisions and product lines) and over time (quarterly, semi-annually and annually). Ideally, CPIs should drive operational KPIs. For example, a CPI such as student satisfaction with safety can drive a school district to monitor KPIs such as number of disciplinary referrals and bullying incidents per hundred students. Through this mirroring, KPIs can drive operational processes and accountability in a way that satisfies customer needs.

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Case Study 1: Urban School District After positioning itself on academic performance and safety, the school district developed CPIs and KPIs that mirrored each other for each school: • Satisfaction CPIs: An annual school-level survey measured overall satisfaction and satisfaction with academics and school safety for each school. The results were comparable across schools and provided consistent and timely feedback to each school principal.

• Loyalty CPIs: This included the likelihood that parents would re-enroll their child in the school for the next academic year and recommend it to friends and family.

• Financial CPIs: The most relevant financial CPIs included the percentage of students who chose to re-enroll and the number of new students attending the school.

• Operational KPIs: The district culled operational metrics related to school safety and academics. For school safety, the school tracked three operational KPIs: an index of bullying incidents in the school, an index of disciplinary placements and an index of safety training procedures implemented by a school. For academics, the KPIs included test scores for reading and math, learning growth in reading and math for each school cohort, and a reduction in the achievement gap for the school’s student body.

Using this model, the school district regained its strategic focus. Whereas neighboring school districts were losing students, this district increased its student body by 5%, improved its financial reserves, was recognized by several agencies for its achievement and attracted higher-quality principals and teachers.

Case Study 2: Major Industrial Company (INDCO) Based on a benchmark survey of its customers, INDCO positioned its brand on project management and on-time

delivery. INDCO then developed specific CPIs and KPIs: • Satisfaction CPIs: For each region, INDCO measured overall customer satisfaction, satisfaction with project management and satisfaction with on-time delivery. These three CPIs were measured for each of its six regions and made available annually.

• Loyalty CPIs: The two main loyalty KPIs included likelihood to invite INDCO to bid on the next project and to recommend INDCO to a colleague or friend.

• Financial CPIs: Financial CPIs included sales growth and margins by region.

• Operational KPIs: For project management, operational KPIs included number of delivery deadlines missed, number of days the project was delayed, unanticipated increases in budget due to schedule delay and rework and number of days taken to resolve specific client complaints.

Senior leadership used these CPIs and KPIs to provide specific feedback to each regional president and hold them accountable to increase sales, margins and earnings before interest, tax, depreciation and amortization by 17% over the following four quarters.

What Now CPIs—customer satisfaction, customer loyalty and financial metrics—can ensure that a company’s strategic plan is customer-relevant, provides meaningful feedback to employees and links customer needs to employee outcomes and accountabilities. By mirroring CPIs in operational KPIs, executives can implement an outside-in and insideout strategy that will satisfy customers and deliver operational excellence. This can be done using a statistically sound measurement strategy based on customer satisfaction and linking it to operational metrics. m VIKAS MITTAL, Ph.D., is a member of the faculty at the Jones Graduate School of Business at Rice University in Houston.

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BRANDING

I’ve taken the liberty to draw excerpts from that presentation, which, in my opinion, was nothing short of prophetic.

I’ve handpicked various concepts Baran described.

Think about how you could refine these remarks, stand up in front of savvy marketers and describe the world in which we live today, some 50 years after Baran called his shot like Babe Ruth.

In 1967, Baran’s audience probably thought his comments read as though they had been pulled from a low-budget science fiction film. But Baran’s musings foreshadowed the power of the internet, including services like Skype and FaceTime, Netflix and YouTube, Yelp and Angie’s List, and Amazon’s many services.

Back to the Future Yesterday’s harebrained projection can become tomorrow’s reality

BY RUSS KLEIN

 rklein@ama.org

I

was about to do what likely 10,000 other marketing professionals are doing, to play futurist on the year ahead. What’s hot? What’s not?

Rather than add to the lists of current trends and prognostications, I’m going to encourage you to read others’ predictions.

I’ve been around long enough to know that so-called trendspotters never miss. They are either right or waiting to be right. No matter how outlandish some ideas may sound, I’m going to push you to read with an open mind and a level of curiosity that should be second nature for any marketer.

One of my favorite communication tactics is a “head fake.” It refers to hearing a description of something that happened

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at a certain point in time, only to learn that the event really occurred at an entirely different point in history. I’ve used head fakes effectively over the years; the tactic came to mind as I reviewed an AMA conference presentation from 50 years ago. It provided the perfect opportunity for a head fake.

In 1967, Paul Baran attempted to predict the future state of the year 2000, some 33 years into the future. Even the title, “Some Changes in Information Technology Affecting Marketing in the Year 2000,” has a tone of unassuming modesty, as if to say, “Here are a few ideas I have. They’re half-baked, so don’t be too critical.”

“The new computer-communications technology could revolutionize the entire process of distribution of goods. … Such development will represent a profound change in our traditional form of distribution. ... Specifically, an interactive, automated, information processing system which allows rapid and friendly coupling between an individual and a huge information base.”

Baran’s comments could have been made 25 years later by Steve Jobs or Bill Gates. The head fake is only getting started as he then outlines his vision of videoconferencing. “[W]e can realistically expect widespread large-screen, color, person-to-person TV communications. … This development will attempt to create the illusion that those in TV communications with one another are in effect within the same room.”

This sounds a lot like Skype, FaceTime and other videoconferencing platforms.

“Entertainment, even for the smallest select audience, will come via the screen.

We no longer will be constrained by the paucity of channels which restricts present television to sponsors fighting for the largest

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slice of the audience, and in the process catering to the tastes of the lowest common denominator.”

Does that sound like Netflix, YouTube, Hulu and other streaming media services?

This prediction is powerful in light of Disney‘s merger with 21st Century Fox or the potential merger of AT&T and Time Warner. These icons are transforming themselves to stay relevant, but I wonder if they are too late.

In addition to new channels for distributing products, Baran also predicted new methods for individuals to exchange information about those products.

“When the consumer reaches the lower end of the selection tree and has narrowed his choice to a small number of contending products, it becomes plausible and appropriate to call up specific advertising for each. This is the socially beneficial use of advertising. Here, the recipient wants to read, to see and to hear advertising. … The consumer can be encouraged to use valid comparative testing information to help decide which product is ‘best.’ ” It’s a predication of electronic word-ofmouth systems such as Yelp, Angie’s List and Google Reviews.

“Much of the shopping will be done from home via TV display. Think of this screen as a general-purpose genie. Pressing a few buttons on a keyboard allows interaction with a powerful information processing network. The information network sends back a modified image to the TV display in response to selections. … The customer wants to know prices and delivery before reaching a final decision. The information storage system can tell him whether the pink shirts with tab collars are available, from whom, when and at what price.

Price comparisons are instantaneous and again reinforce the free enterprise price mechanism. Direct dealing with the manufacturer will increase, as the goods

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will be dispensed from the most economic storage point.”

This accurately points to Google, Amazon, the Home Shopping Network and online retailers.

While it took time for technology to become readily available, you shouldn’t be surprised that Baran was able to leap from early online shopping to today’s more sophisticated form of online consumerism.

“Consider another class of goods whose purchase is totally a repetitive nuisance to the consumer—shopping for staple groceries. Once finding a brand of pickled string beans that suit your fancy, you wish to reorder the exact product without having to play Sherlock Holmes. You would like to be able to reorder many such items painlessly. Again, the computer can come to our aid by providing us with a stored list for rapid recall ordering. The better information available about alternative prices for the same goods will eliminate the undignified loss-leader game to trick the consumer into the store.”

In 1967, Baran’s audience probably thought his comments read as though they had been pulled from a low-budget science fiction film. But Baran’s musings foreshadowed the power of the internet.

It sounds like the pitch for Amazon Subscriptions and smart-home services.

As you read through the prognostications of the years to come, take a second look at the ideas that now seem unbelievable or farfetched. It may be that what seems barely possible today will soon become reality. m As CEO for the American Marketing Association, RUSS KLEIN is charged with the transformation of the AMA to become an essential community for marketers. Klein is a five-time award winning CMO who has quarterbacked teams for many of the world’s foremost brand names—holding top marketing and advertising posts at Dr Pepper/7UP Companies, Gatorade, 7-Eleven Corporation, Arby’s Restaurant Group and Burger King where he also served as president from 2003-2010.

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DREAM LESS, DO MORE

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2019 MARKETING PREDICTIONS We’re closing the book on a decade marked by digital marketing trends, influencers and AI. This final year of the 2010s means less dreaming and more implementing.

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OPPORTUNITIES AND RISKS IN 2019 OPPORTUNITY

RISK

KNOWLEDGE-BUILDING

NOT SHARING THE KNOWLEDGE ACROSS TEAMS

The largest percent change (8% increase) in marketing knowledge investments in the prior 12 months was in developing new marketing knowledge and capabilities. 1

26% of creative professionals say that a lack of cross-departmental collaboration is the biggest barrier to executing digital initiatives.4

DEEPER CUSTOMER INSIGHTS

FAILING TO SPEAK WITH CUSTOMERS DIRECTLY

31% of consumers say that they would find great value in services that intuitively learn about their needs over time to customize product, service or content recommendations.2

Only 42% of B2B content marketers say they have conversations with customers as part of their audience research.3 As explained in Liam Fahey’s The Insight Discipline, insight often comes from small data—which means interacting directly with consumers.

CONTINUED MIGRATION TO DIGITAL MARKETING

UNCERTAINTY IN MEASURING SOCIAL MEDIA EFFECTIVENESS

In 2019, digital ad spend is expected to grow 12.3%, versus a 1.2% decrease in traditional ad spend.¹

“”

“In conversations with most of our clients, training has been discussed at length. From distributor training to internal staff training, utilizing interesting, interactive [learning management systems] to bring organizations and brands together has been a focus. Each organization has their own issues, but leveraging technology to train about products, culture and mission is a trend that will continue and grow in 2019.”

Jim Heitzman, president of advertising agency Celtic Chicago

Although spending on social media is expected to grow by 66% in the coming five years, only 24% of CMOS say they’re able to prove the impact of social media quantitatively. 1

WORKING ACROSS DEPARTMENTS

CONFLICTING GOALS AND PRIORITIES

Professionals give their company’s cross-department collaboration efforts a 3.5 out of 5 rating,4 leaving plenty of room for improvement.

37% of professionals say conflicting goals and priorities are the biggest barrier to cross-departmental collaboration at their companies.⁴

“[There’s] lots of pressure to be integrative [and] cross-functional in approach to go-to-market strategy.”

Bernie Jaworski, the Peter F. Drucker Chair in Management and the Liberal Arts

1. “CMO Survey,” Christine Moorman // 2. “Global Consumer Pulse Research,” Accenture // 3. “B2B Content Marketing 2019,” Content Marketing Institute // 4. “Collaboration in the Workplace,” The Creative Group // 5. “2018 Brand Trust Survey,” Janrain // 6. “2018 Edelman Earned Brand,” Edelman

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OPPORTUNITY

RISK

PERSONALIZATION

LIMITED CONCERN ABOUT DATA PRIVACY AND SECURITY

43% of U.S. consumers are more likely to shop with companies that always personalize experiences, and 31% say that they would find great value in services that intuitively learn about their needs over time to customize product, service or content recommendations.²

MAKING A SOCIAL STAND 64% of consumers are beliefdriven shoppers, a 13-point increase from the year prior. It’s not just millennials, either: A majority of all ages and all incomes are beliefdriven buyers.6 75.8% of CMOs who take a social stand say it shows their company cares about more than making profits.¹

92% of U.S. consumers say it is extremely important for companies to protect their personal information,² and 48% will try to buy only from companies they believe will protect their personal data, though they don’t fully trust all of the brands they conduct business with.6 Despite high customer concern about data privacy, marketers rank the topic as only 3.6 on a scale from 1 (not at all worried) to 7 (very worried).¹

“”

“Personalization will continue to be a big differentiator. Using technology does not mean talking to customers at scale generically; it creates the opportunity to talk to customers specifically on the right channels at the right time.”

Erika Brookes, CMO of Springbot

NEGATIVE EFFECTS ON THE COMPANY’S ABILITY TO ATTRACT AND RETAIN CUSTOMERS AND PARTNERS 78.6% of CMOs do not believe it’s appropriate for their brand to take a stance on politically charged issues.

Although this is down from 82.6% six months prior, CMOs remain concerned that taking a stand will negatively affect their ability to attract business, make them stand out in the wrong way and be a waste of resources.¹

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MARKETING CAREERS IN 2019 MANAGERS

JOB SEEKERS

KEEP YOUR TEAM HAPPY: The top three drivers of workplace happiness for creative and marketing professionals: 1. Doing worthwhile work 2. Feeling appreciated for what they do 3. Interest in their work7

In 2019, the number of marketing hires is estimated to increase by 6.4%. The biggest percent increase in planned marketing hires in the next 12 months is in B2C product companies (9.7%), followed by B2B product companies (7%), B2C services (6.3%) and B2B services (4.1%).¹

POLISH YOUR DIGITAL SKILLS: 71% of creative and marketing professionals say it’s hard to find talent with up-to-date digital skills. Employers are increasingly interested in candidates who are proficient in: • Artificial intelligence and machine learning • Content creation and content marketing • Data science, data analysis and A/B testing • Digital strategy • Front-end web development • Motion graphics • SEO and SEM • Social media management • User experience and user interface design • Video production⁷

FOSTER A POSITIVE CULTURE: 35% of job candidates would not accept a position if the role were perfect but the corporate culture wasn’t.8 CONSIDER FLEXIBLE WORK ARRANGEMENTS: Half of advertising and marketing hiring decisionmakers feel productivity would increase if their company instituted a compressed schedule, where employees work four 10-hour days. 76% support allowing staff to attend to nonwork-related tasks while on the clock to boost overall performance.9

PROVIDE OPPORTUNITIES TO LEARN NEW SKILLS: 70% of creative professionals rate efforts by their organization to prep employees for new technology adoption as fair or poor. The top skills they would like to develop include: 1. Web and user experience design (24%) 2. Content creation and content marketing (8%) 3. Data visualization (8%) 4. Video production (8%) 5. User interface design (7%)10

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7. “2019 Creative & Marketing Salary Guide,” The Creative Group // 8. “Organizational Culture: The Make-or-Break Factor in Hiring and Retention,” The Creative Group // 9. “The Case for a Flexible Workplace,” The Creative Group // 10. “The Creative Workplace: Trends and Challenges,” The Creative Group and AIGA

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HIGH-TECH TRENDS TO WATCH • AUTHENTICATION TECHNOLOGY: 67% of consumers are interested in fingerprint recognition to make payments. 59% of consumers abandon online purchases because they didn’t have their debit or credit card and 49% abandon their cart because they forgot their password.11

• SMART SPEAKERS: The number of smart speaker users in the U.S. is expected to grow to 76.5 million by 2020. The average smart speaker user has the same profile as most early tech adopters: affluent, older millennial males. However, smart speakers have started to gain traction among other demographic groups, particularly younger Gen X women with children.12

• NANOINFLUENCERS: Marketers are tapping nanoinfluencers—online personalities with as few as 1,000 followers—to reach desired consumers. Unlike celebrity influencers, these smaller-scale influencers are easier to work with and their lack of fame makes them more approachable and more genuine to their followers. Instagram users with 1,000 to 10,000 followers earn the highest “like” rate,13 and 82% of surveyed customers say they would be very likely to follow a recommendation from an influencer of this size.14

• BLOCKCHAIN: If you still don’t know what blockchain is, it’s time to do your research. Blockchain may have major implications for marketers, as the technology is predicted to change data collection, digital display ads, consumer targeting and digital asset security.

• CHATBOTS: Chatbots can deliver the speed consumers crave. The top three potential benefits of chatbots identified by consumers are 24-hour service (64%), instant responses (55%) and answers to simple questions (55%).15

• SNACKABLE CONTENT: Think tweet-able graphics and bumper ads (typically six seconds in length). These easily digestible pieces of content are almost too short to ignore. Google tested more than 300 bumper campaigns in 2016 and found that 9 out of 10 drove a significant lift in ad recall.16

11. “Goodbye, passwords. Hello, biometrics.” Visa // 12. “Hey Alexa, Who’s Using Smart Speakers?” eMarketer // 13. “Instagram Marketing: Does Influencer Size Matter?” Markerly // 14. “Research Shows Micro-Influencers Have More Impact Than Average Consumers,” Experticity // 15. “The 2018 State of Chatbots Report,” Drift // 16. “Bumper Ads,” Google

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WE ASKED MARKETERS: WHAT’S IN AND WHAT’S OUT FOR 2019?

IN “Continued migration to digital marketing and budget shifts away from traditional sources. Increased buzz on predictive analytical modeling and focusing more on the future than on past historical data.”

Bernie Jaworski, the Peter F. Drucker Chair in Management and the Liberal Arts

“Communication and conversion via technology that moves further into the background, learns daily habits and frees the user from a handset.”

Tasha Cronin, co-director of interactive production at Droga5

“2019 will be the year when the AI hype cycle turns into AI implementation in most of our marketing tools. ... First, AI functionality, flexibility and ease of use will increase. Second, there’s a growing awareness of the cost-saving benefits of AI within marketing.

Third, companies are realizing that AI is crucial for implementing one-to-one marketing—particularly across social media channels.”

Grad Conn, chief experience and marketing officer at social media management software company Sprinklr

“The surge in influencer marketing will reach further into the B2B world. While few B2B brands will have the budget—or desire—to earn a Kardashian plug on Instagram, receiving an endorsement from a valued expert voice within the field can go a long way.”

Jeremy Hogan, associate director of content and social, Celtic Chicago

“Widespread use of virtual and augmented reality as a marketing tool. With commercial applications for these technologies coming online at a breakneck pace, these are no longer futurist concepts, they are the present. …

Look for [small- and medium-sized businesses] to get in on the act in 2019 and determine creative ways to use this exciting technology to engage their customers and prospects.”

Adam Grossman, CMO and EVP of Boston Red Sox & Fenway Sports Management

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OUT “I have the same item that I’ve been unsuccessfully wishing away for years, but it’s getting closer to reality all the time: the end of demographic targeting.”

Peter Fader, professor of marketing at the Wharton School at the University of Pennsylvania

“Treating content like a test-and-learn budget. It should be a cornerstone of marketing and sales strategy.

(Same with) fixed marketing plans and budgets. Agile is the new world order for marketers, not just for developers.”

Erika Brookes, CMO of eCommerce marketing automation platform Springbot

“User interest is no longer king; marketers need to focus more on intent. While a company’s value and story will be the same, the language around any outreach must reflect the intent of the user. Whether that’s looking for growth, profit or something more qualitative, [language] needs to clearly align with your user’s intended outcome.”

Hana Abaza, director of marketing at Shopify Plus

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MARKETER REPRESENTATION AT THE BOARD LEVEL CAN DRIVE GROWTH.

SO WHY ARE THEY UNDERREPRESENTED? Marketing at the board level is stark: Only 2.6% of board members have any marketing experience and less than 0.5% of Fortune 1000 board seats are held by active marketing leaders. Kimberly Whitler, a former CMO and current academic, hopes that new research can help marketers grow their influence at the board level.

BY HAL CONICK

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‘N

o Kim, you don’t understand: Never, ever should a marketer be on a board.”

Kimberly Whitler remembers having to keep herself from shaking with anger when she heard this response.

The comment came from a European businessman she was interviewing, she says, a man who had sat on many boards over the years, mostly in manufacturing. She found his opinion dogmatic and short-sighted. “It just didn’t make sense to me,” she says.

Whitler calmed herself. “Help me understand,” she remembers saying, “what is it that makes you think that marketers are never valuable on the board.”

“Well, marketing is largely luck,” he responded. “And it’s not strategic.” Whitler asked what functions were strategic, to which he replied, “Operations.”

Whitler says that she nearly fell out of her chair—operations is strategic but marketing isn’t?, she thought. Instead of telling him that he was wrong, she kept listening and realized that the way he thought made sense: The boards he had served on likely marginalized marketing, shunning it as a waste of time and money, never treating it as a strategic function or giving it a chance to drive growth. How could he think that marketers should be on boards if he’s never worked with a good marketer?

Whitler—who earned her Ph.D. in marketing in 2014 after two decades as a high-level marketing practitioner and now works as an assistant professor of marketing at the University of Virginia’s Darden School of Business—wanted to explore what effect marketers could have on boards. After eight years of research and writing, Whitler and two colleagues—Ryan Krause and Donald Lehmann—published their paper, titled “When and How Board Members with Marketing Experience Facilitate Firm Growth,” in the September 2018 issue of the Journal of Marketing.

Numbers in the paper show a stark reality: Although 16% of boards have at least one member with high-level marketing experience, a survey of board members showed that only 4% believe that marketing experience is important. Ninety percent of boards with a marketer have only one; 9% have two and less than 1% have three marketers. They found no boards had more than three marketers.

But there’s room for hope: Whitler, Krause and Lehmann analyzed 64,086 biographies of board members who sat on Standard & Poor’s 1500 firms between 2007 and 2012, searching for those with marketing experience. They found that firms with at least one experienced marketer on the board had revenue increases of 5.78 percentage points compared with firms with no marketers on board. The researchers found evidence suggesting that boards with experienced marketers are positively associated with future business growth, but say that this relationship is “highly contingent.” For example, growth is stronger when the firm’s economic circumstances demand marketing expertise—namely, when the company’s market share is weak and its industry is experiencing weak growth. What does it take to make a board pay attention to marketing? Perhaps a single marketer, the paper says, but “[the marketer’s] ability to do so depends on the extent to which they can influence the board and the extent to which the board can influence the [top management team].” The lack of marketers on boards “impairs firms’ ability to tackle demand-side problems, even though boards and CEOs consider growth generation among their most challenging problems,” the paper says. This is a contradiction, the authors write, which suggests that boards can’t see the connection between their inability to address growth challenges and their lack of marketing experience.

Marketing News spoke with Whitler about her research, board-level aversion to marketing expertise and how marketers can win more influence in the years ahead. This interview has been edited for clarity and length.

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MARKETING NEWS: Why has so little research been done on how marketing influences the board?

WHITLER: Management believes that it’s a marketing issue and marketing has historically said upper echelon stuff—governance, boards—is the realm of management. I’m hopeful that some of the work that’s been done at the CMO level—like the work Frank Germann, Peter Ebbes and Rajdeep Grewal have been done on why the CMO matters—makes an impact on the firm. There’s hope, energy and excitement for marketing to weigh in and potentially even lead the marketing conversation in the upper echelons of the firm.

MN: Why do boards seem averse to marketing expertise?

WHITLER: There has been research done on management that demonstrates that board members are susceptible to in-group bias, just like the rest of us are. In this case, the in-group bias is functional.

If you have a board of all finance people, they all use the same language, they’re all trained in a similar way and all see the firm in a similar way. When given a choice, they’d love to hire more finance folks.

That collides with something else that happened: In 2002, the U.S. passed the Sarbanes–Oxley Act after the implosion of Enron, WorldCom and others.

It’s a regulation that mandated all boards must have financial experts and it held boards more accountable for firm performance. After that regulation passed, boards structured themselves differently. There are fewer board members—part of the reason is that the requirements of board members went up and it was tougher to get sitting CEOs on the board. Also, the average size of boards tended to go down. You’re now being mandated to have a finance expert on the board because of the need to monitor the firm’s performance. There was this rapid shift toward pushing for more regulatory-type experts on the board—finance, accounting, maybe legal in some cases, but a lot of finance experts. So now you have a shrinking average board and more of one function and one mindset. What happens on any team when you start getting a dominant group? Is it possible that you might look for more people like yourself?

Now the mindset of the board chiefs changes and their desire to bring in marketers lessens. This is all a hypothesis—I’m still pulling together pieces of information. But over time, we’ve had regulatory and marketplace changes that have driven structure and composition changes. Then on top of that, we know

Marketers have a growth mindset and an external mindset, while finance is a more inwardly focused, throughputoriented function. They have different orientations and they’re oftentimes pitted against each other.

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that in-group bias exists at the board level. These are problems.

MN: One section of your paper says that this bias against marketers is most likely to be held by CFOs. How can marketers change that bias?

WHITLER: Marketers and finance people come from very different thought worlds. In managerial research, it’s well recorded that there’s been some conflict between the two functions. Finance tends to manage the purse strings, but marketers are trying to engineer growth. Engineering growth oftentimes requires investment, so they think differently.

Marketers have a growth mindset and an external mindset, while finance is a more inwardly focused, throughput-oriented function. They have different orientations and they’re oftentimes pitted against each other.

The nature of these two has to be in balance for the company to work well. You need both sides— it’s the yin and yang. I would suggest that you want both functions to look for the value in the other.

But if I’m talking to a marketing community, the onus is on us to help. We’re in charge of changing consumers’ minds. If you have an obstacle inside the company where a function doesn’t value you, we should have an expertise in being able to affect that belief.

MN: In 2018, Spencer Stuart reported that a large number of CMOs were changing jobs; some CMOs changed companies, some lost jobs. Are companies—perhaps even marketers themselves—still confused about what, exactly, a high-level marketer does and how they should be measured?

WHITLER: Yes. Over the course of the last eight or nine years, I’ve conducted 500 or 600 interviews— I’ve talked to CMOs, CEOs and executive recruiters.

Nobody really understands the variance in the marketing function.

I’ll give you an example: I was talking to a marketer who graduated from a top MBA program.

He worked at a large beverage company before taking a promotion to work at a tech company. I know from my research that those marketing roles are totally different. At the beverage company, he led strategy for the brand; he was in the driver’s seat.

In tech, marketing follows. He had moved from one type of marketing role that was a leadership, strategic role to one where marketing was not valued nearly as much. It was more of a support staff for

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the engineers. After all my interviews, I knew that would be a horrible shift. I asked him, “Knowing what you now know, would you have taken the job at the tech firm?” He said, “Absolutely not.”

The problem is that he did not know of the variance in roles. All he knows is levels: He knows that a director is senior to a brand manager and so he’s looking at a very blue-chip tech company going, gosh, everybody thinks this is a great company! Well, it is—for engineers; not as much for marketers. All he evaluated was brand name is good, level is better and money is better. That’s the degree of his assessment and he jumped. Now, his training is not a great fit and the job is not what he thought it would be.

MN: If marketers don’t even know their roles, how can CEOs or the board know?

WHITLER: CEOs are not experts in CMO roles. I’ve interviewed folks who have had five, six or seven different CMO roles—they get it because they’ve lived through the pain. But somebody who’s had one or two CMO roles doesn’t know enough to figure it out.

MN: Do CMOs and marketers consider who is on the board when looking for a new company?

WHITLER: CMOs have not historically thought about the board. My hope is that our research will help them understand how who’s on the board can affect them. Just something as simple as: Are you invited to board meetings? Because if you have an advocate—a marketer—on the board, they’re more likely to want to hear from the CMO and the firm.

MN: Is increasing influence as simple as having one board member with marketing experience?

WHITLER: In our dataset of over 65,000 board member biographies, we don’t have much incidence of board members being marketers.

Roughly 16% of boards have marketers, but it’s typically one person. We don’t have boards with six or seven marketers on them, so we don’t have a large sample. But I can give you a story of how the power of just one individual can change everything.

I spoke with a woman who is on the boards of multiple large companies. On one board, in an industry with monopoly-like power, she was the first marketer on the board. I asked her, “Do marketers matter? Help me understand what

type of impact you have.” She said that when she got to the board, she was fascinated because her experience had been in industries where marketers were drivers of firms—she had that profit-andloss marketing experience. For her to enter an industry where marketing has not historically been very important and many of the firms have monopoly power, she noticed that the thinking is quite different. During her first meetings, she just observed and said that the board didn’t talk about the consumer or the customer. Not once. She’s on other boards and she’s a very successful practitioner who had reached the C-level at large, respected companies—to sit through a board meeting and not hear anybody talk about the external consumer was somewhat shocking to her. She also asked about their digital strategy, because that was a hot topic at that point. After the board meeting, she was pulled aside and told that digital is a tactical discussion and they, at the board level, don’t deal with tactical discussions.

Now, three to four years later, digital transformation is a core strategy of the company.

They talk about the consumer all the time and they even have somebody at the C-level who is in charge of consumer engagement. How did that happen?

How does one voice change the strategic direction of the firm? I started probing, asking her questions, and she said, “I just started helping them see the future. They currently have a monopoly, but in the future they will not. I started showing them trend information data and where the industry is going.

And then I simply asked questions.”

MN: Is one voice on the board enough to influence the top management team—CEOs, CFOs, CMOs? WHITLER: One of the things that surprised me most when I did the interviews with the marketing board members is how engaged they were with the internal marketing apparatus of the firm. We’re taught, historically, that the board meets four times a year and has very little direct interaction with the management team. Obviously, they have a lot of interaction with the CEO and the CFO, but beyond that, not a whole lot. But several of the individuals I interviewed were asked to lead or serve on task forces. They have different terms, like ad-hoc committee task forces, but these are essentially special committees designed to help solve operational issues in the firm.

When this would happen, the marketing board member was working directly with the CMO and

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with some marketing function to solve specific problems. One marketer, who worked with a very large fast-food company in the U.S., was on their board and saw that marketing in the firm was not doing well. The CEO-chairman asked the marketer on the board to lead a task force to look at marketing in the firm, including key partners like advertising agencies. That’s a very engaged level of work with the management team. This individual brought in experts from New York ad agencies and other leading marketing companies and formed a group to counsel the internal marketing organization.

MN: Fast-food companies are struggling with a shrinking market right now, so it makes sense that they’d try that.

But are stories like this out of the ordinary?

WHITLER: Today’s contemporary, progressive board is expected to improve business outcomes, one board member told me. Think about it this way: If you’re paying board members $250,000 per year and you’re paying to wine and dine them, the board could be a multimillion dollar investment. Don’t you expect an ROI? If all they’re there to do is to make sure that the books are accurate and to monitor the functioning of the management team, you’re not activating the full potential of the board. More progressive boards expect board members to have positive impact on business results.

In management literature, researchers think of boards as playing three different types of roles: a monitoring role, a social capital role and a human capital role. The social capital role is about the value of networks, meaning if I’m a board member on American Express and a board member of Procter & Gamble, I now have relationships in two different industries and experiences that I can bring to bear on each company. My knowledge as a board member at Procter & Gamble may help me make connections and my network may be able to help the performance of Amex and vice versa. A finance person can serve on the board and in a monitoring role, but they also have expertise potentially in M&A work and that expertise can be useful in helping the management team. These people have 40 to 50 years of experience—the human capital role can be critically important.

MN: How can marketers win more board-level influence?

WHITLER: The first thing is that they have to earn

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it. I spoke with a CMO of a large financial services firm and the CEO was clear: He wasn’t going to give her more authority, but he wanted her to have a bigger impact. The CEO invited the whole marketing function to step up. “I’m inviting you to play a more impactful role,” he told her. “I’m not giving you more territory but I’m inviting you to be more influential.” She said to her team, “Let’s engage in a different way: How do we think about the big problems of the company?” She listened differently to the CEO and the senior team. She looked at the big challenges and stepped into the gap. Rather than saying, “This isn’t my job, my job is X,” she said, “The company is having a problem in a certain area. Let me get my team to think about it and I’m going to come back to the table with some thoughts.” Her team wasn’t asked to think, but they started stepping up. I call this stepping into the gap. She told the CEO, “I know that this is not technically in my area, but marketing can lend a voice on this. I’m pretty sure what started happening is…” And the CEO said that he knew she was going to have a bigger impact.

How do you get more influence? The short answer is that you have to earn it. At one level, you can be invited to the table, but when you’re at the table, you actually have to have influence.

How do you know if you’re in a position to grow your influence? How do you earn that right?

Demonstrating the type of impact you can have, the way you work with your internal peers and help them achieve their goals are likely effective ways. There’s an opportunity to step into that gap.

Over time, if we do a good job of that, we earn the right to be invited to more of those important conversations.

MN: And in most cases, I’m guessing that there will be no invitation. The CMO or marketing manager must take the initiative.

WHITLER: Yeah. As a former manager, a former CMO and a former GM, who did I always love to promote? The people who stepped into the gaps.

There are a lot of people who wait for the ball to be thrown to them, but the problem is that balls are being dropped all around us. I look for the people to step up and say, “Hey, that ball didn’t come to me, but the ball’s being dropped and I’m going to step up and I’m going to pick up that ball.” That’s a signal that you’re ready to be promoted. Those tend to be very high-impact people. To earn the right,

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you have to be competent. One of the things I often share with CMOs is that you want to constantly be developing and growing and improving your own capability. Invest in your own learning and growth.

Most C-level marketers need to go back and at least take contemporary stats. When I was learning stats the first time, we had books; we didn’t have computers, we did everything manually. Today, you can quickly do conjoint or cluster or factor analysis—tasks that would have taken two hours to calculate manually. C-level marketers need to retool and to stay current with the digital transformation.

MN: What about marketers who want to get onto a board themselves?

WHITLER: Part of it is awareness of marketers’ positive impact. There are a couple of executive recruiters who use our research to share with boards when it might make sense to add a marketer. It’s not under all conditions, but if boards or companies are struggling with certain issues, there are times when it might be valuable to add a marketer. It’s good for them to have this empirical evidence of how marketers can have a positive influence.

Another part of is it that when marketers get on board, they have to be successful and effective.

If you have only one marketer on a board—like the marketer on the board with monopoly-like power—you need to speak the board’s language.

If she came to the company and didn’t speak the language of the board and wasn’t perceived to have a positive effect on board processes and outcomes, that wouldn’t be helpful. We want effective, successful marketers that will help grow the companies for marketers in the future to be in the boardroom. There has to be a positive experience for the board members who sit on multiple boards. They should be saying, “I have a marketer on this other board. They’ve really been helpful in addressing certain issues at the company and I think that type of expertise might be valuable on this board.” But if they don’t have a positive experience, that will not bode well for marketers.

I don’t think that all marketers are going to necessarily be good board members—not all marketers are equally skilled or are prepared to go on boards. Future research needs to help us understand what those skills are. Under what conditions are some marketers prepared to be successful at the board level? What type of training is required? We don’t know yet. m

You have to earn it. At one level, you can be invited to the table, but when you’re at the table, you actually have to have influence.

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Gamer Gateway Fortnite’s runaway success both echoed and surpassed previous gaming sensations. Could its massively popular multiplayer features and eyepopping jackpots help marketers get their sea legs with esports?

By Zach Brooke

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first felt the cultural force of “Fortnite” when I couldn’t select a user name. I was aware of the viral

video game from the many references saturating news and pop culture, but the difficulty of coming up with a unique identifier placed me in the eclipse of its soft power. Typing in all manner of nouns that fired through my neurons only to see them rejected felt as if the Big Data miners finally figured out how to replicate my thinking patterns: An obscure disco-era musician dead since 1983; a piece of furniture sent for repairs. Both taken.

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pitched aerial battles and bird’seye assassinations. Season 2 was medieval-themed, Season 3 was set in outer space and Season 5 involved time travel. Every few months, Epic Games tinkers with the user experience just enough to keep people curious.

The desire to improve, coupled with the spectacle of stellar game play, fuels a robust secondary market on social media: Hardcore “Fortnite” gamers spend hours on sites such as Twitch, a live-streaming platform where the audience watches players. This is no small cult of viewers. Twitch reported a daily active audience of 15 million in May 2018. “Fortnite” became the No. 1 game streamed on Twitch in March 2018, and “Fortnite” hours watched have grown more 400% since the game debuted, according to numbers from SuperData, a Nielsen company.

The most popular streaming gamers have paid contracts

requiring them to be live a minimum number of hours each week, in addition to representing organized teams in gaming tournaments. The top 17,000 Twitch streamers are eligible to share ad revenue with the site, and the gamers decide when ads run during their marathon livestreams. Sometimes hip-hop celebrity Drake shows up.

“I have these two cousins— they’re very close in age—and everyone was very concerned about their well-being because they never left the basement,” says Paige Schoenfeld, associate vice president at Ipsos. “As soon as one of my cousins became a paid player, the attitude in our family changed.”

Nielsen says “Fortnite” has grossed more than $1 billion since its release, a remarkable feat for a company offering a free product. Revenue comes from microtransactions, sales of digital items needed to customize ANDY KING/GETTY IMAGES

Success arrived only after keying in “newdisplaynam.” The hurdle now bested, I assented to terms and conditions and was promptly ushered into the game lobby by way of the digital gift shop.

Not wanting to screw around any longer, I hit play. The game loaded and there I stood, my avatar deposited on a virtual verdant island. I ran around for my life, such that it was, armed with only a pickaxe. I was dead 10 minutes later. I hadn’t killed anyone, nor was I smote by another player’s hand. I galloped free until enveloped by a lethal thunderstorm that slowly sapped my lifeforce. I keeled over beside a river. My body vanished, leaving behind only my weapons cache to be scavenged.

This experience played out millions of times per day since September 2017, when “Fortnite” introduced its battle royale mode and sparked a worldwide phenomenon. This is the option that pits as many as 100 players against one another. It’s possible to collaborate in groups as large as four people, but the whole setup is essentially every person for himself. Kill or be killed; last one standing wins.

This basic formula proved wildly popular over the last year and a half. “Fortnite” developer Epic Games has switched up the environs a few times since then to keep things fresh, perhaps to prevent the brand from going the way of past flashes in the pan such as “Angry Birds” and “Pokémon Go.” I played Season 6 of “Fortnite Battle Royale,” in which developers added features that suspend gravity, allowing for

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characters and enhance game play. Microtransactions are not new in the gaming world (Kim Kardashian’s “Hollywood” app has relied on them to earn hundreds of millions of dollars since 2014), but “Fortnite” has advanced the nature of microtransactions.

Similar to gamblers riding a hot streak, users are incentivized to play more for the chance to win free microtransactions.

The revolving cache of items provides ample opportunity for native marketing; Marvel Studios has introduced skins for both Iron Man and Thanos into the “Fortnite” universe as tie-ins for “Avengers” movies.

The microtransactions have allowed “Fortnite” to branch out

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into the world of competitive gaming, or esports. Epic Games, which did not respond to a request for comment, is currently organizing its first World Cup. The competition is open to all but has many qualifying stages. At stake is $100 million in prize money distributed at various events throughout the year. That money is backed by the huge revenue stream from microtransactions, as well as Epic Games’ new $1.25 billion round of investment funded by a group that includes the owners of the Los Angeles Dodgers, Golden State Warriors, Tampa Bay Lightning, Washington Wizards and Capitals, as well as Michael Jordan. The sheer amount of buzz

attached to the World Cup debut will make it one of the mostwatched gaming developments of 2019.

“There’s no denying the impact ‘Fortnite’ has had on the overall gaming industry, gaming video content and even pop culture this year,” says Nicole Pike, global managing director at Nielsen Esports. “All eyes will be on ‘Fortnite’ as an esport moving into 2019, and with it the types of sponsorship deals these new events attract.” “Fortnite” needs to deliver the large audiences that investors expect, but also maintain a high level of fan engagement to match other highprofile esports leagues and events.

With its highlights, instructional

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and ending a five-year streak of tournament domination by South Korean squads. Worldwide peak viewers topped out at more than 200 million people, according to analytics agency Esports Charts, 99% watching from China. Non-Chinese streamers YouTube and Twitch reported a combined audience of 2 million.

Despite the difference in the numbers, “League of Legends” isn’t just an Asian anomaly; it’s a worldwide sensation. The average number of non-Chinese viewers watching the tournament at any given time clocked in at 591,500, a 14% increase from the 2017 championship. “League of Legends” is the product of a Los Angeles development studio purchased by Chinese media giant Tencent. And on the same weekend the 2018 championship was played, “Fortnite” held its own live event, which also drew 2 million livestream viewers on YouTube and Twitch.

Closer to home, but also carrying a global footprint, is the Overwatch League. Designed as the first city-based esports league, the organization mimics

traditional sports franchises by cultivating regional followings for teams that compete in the “Overwatch” game. The inaugural season closed in July with an estimated audience of 10.8 million viewers, some watching on ABC and ESPN thanks to an agreement with Disney, which owns both channels. Overwatch League has already sold more than $200 million in sponsorships and broadcasting deals.

In 2019, Overwatch League is poised to grow larger. Activision Blizzard, the video game holding company that owns “Overwatch,” confirmed in September 2018 that the league will add eight new teams by next season’s kickoff on Valentine’s Day 2019. Two of the new squads are U.S.-based, three are in China, two in Canada and one in Europe. The price tag for the new franchises grew between 50% and 200%, compared with the inaugural franchises, according to ESPN, which reports individual ownership groups shelling out between $30 million and $60 million per franchise, versus $20 million each for the inaugural dozen. There’s talk that BLIZZARD ENTERTAINMENT

videos, live competitions, reward money, ownership groups and marketing tie-ins, the whole ecosystem mirrors the traditional sports world. The line between esports and traditional sports is thin. It’s time for marketers to stop discriminating between the two. “[Esports] is definitely a sport,” says Jan Weber, spokesperson for international sports communications at MercedesBenz, a company that has invested branding dollars in esports.

“Gaming at [the professional] level requires enormous concentration, teamwork, speed and skill, as well as a very strategic and tactical approach.

These are attributes that constitute a sport. The stress level and physical strain are just as high as for top-class athletes in some traditional sports. Furthermore, the entry barriers for esports are much lower than for traditional sports. While clubs are looking for members, esports fans merely need to open a browser or client to take part.”

As the marketing industry waits to see how Epic Games’ grand esports experiment proceeds, rival leagues are growing. Outside of the U.S., esports has already arrived.

Analysts at Goldman Sachs projects that esports will earn $3 billion and reach an audience of 300 million global viewers by 2022. That’s larger than the fanbases for the NHL and MLB. It’s 92% of the U.S. population.

The passion for esports was on full display in November 2018 at the League of Legends Championship, arguably the sport’s most prestigious competition. The event was won by the team Invictus, marking the first time a Chinese team took the league’s grand prize

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the league may one day contain as many as 28 teams, although there is no public time line to reach that number.

The Toronto Defiant is part of the current crop of new entrants.

In late October, the team’s ownership, OverActive Media, unveiled its identity on YouTube with all the theatrical flair of a video game trailer. “For a long time, they told us our city had no soul. They called us ‘Hollywood north,’ ‘Little New York,’ ‘Americalite.’ And for a long time they told us our game had no game,”

the video’s narrator reads over sweeping shots of the skyline.

Team CEO Chris Overholt is new to esports, but not professional sports marketing. In 1995, he joined the Toronto Raptors as director of corporate marketing shortly after their debut season.

He followed that up with CMO stints with the Florida Panthers and the Miami Dolphins. For the last eight years, he performed the dual roles of chief operating officer and CMO for the Canadian Olympic Committee.

Overholt says that the work

Who’s Who? » Activision Blizzard A U.S.-based video game holding company formed in 2008 through the merger of two existing game developers. Traded on the S&P 500 since 2015, its popular titles fashioned into esports include “Call of Duty,” “Starcraft,” “Warcraft” and “Overwatch.”

Activision Blizzard also controls the popular mobile game “Candy Crush Saga.”

» ELEAGUE An esports league, also called EL, launched in 2016 and aired on television. Formed in a partnership between Turner Broadcasting and talent agency AME/IMG, its matches are broadcast live on TBS on Fridays during the season, but they are also available through Twitch and YouTube. Several different titles have been played on the show, and the program signed a fall 2018 partnership with gaming giant Nintendo to feature footage from a “Super Smash Bros. Ultimate” tournament.

» ESL This European-based esports organization and

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he’s doing for Overwatch League is the same as his previous gigs.

He ticks off the whirlwind of activity that’s consumed his time since helming the franchise.

“You’re building a brand,” he says. “You’re going to develop a strategy around how you’re going to market that brand and that franchise in your local market and work with your league partners.”

But Overholt isn’t just helping to establish a new team, he’s introducing fans and marketers to an entirely new sport. He’s establishing a constellation of

gaming company launched in 2000, making it the oldest operator still in existence. In 2015, Swedish digital entertainment giant Modern Times Group (MTG) acquired a 74% stake in the company for $86.4 million. ESL hosts tournaments for “Battlefield Earth,” “Dota 2,” “Counter-Strike,” “StarCraft II,” “Mortal Kombat” and “Hearthstone.”

» Fortnite The gaming darling of the moment. Its first iteration of game play was structured around a story mode and released on July 25, 2017, but the “Fortnite” phenomenon truly developed in September 2017 with the introduction of a battle royale mode, which allowed players to fight each other to the death in free-for-all sprints. Epic Games announced in a June 2018 blog post that membership surpassed 125 million. Nearly 80 million people played “Fortnite” in August 2018 alone, when the game still wasn’t available to Android users (this version available in October 2018). The company is expected to launch a World Cup this year.

» League of Legends Before “Fortnite,” “League of Legends” was considered the largest esport in the world based on viewership. Its 2018 World Championship drew

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sponsorships and developing a new fan experience that caters to esports’ young and digitally engaged audience.

“There is no doubt that our audience is young,” says Overholt.

“The demographic for [the Overwatch League] is between the ages of 18 and 25. It extends out to 35, but the sweet spot is in the early 20s, versus an NBA franchise where the average age of the declared fan is in the mid- to late-40s.”

The Toronto Defiant will not play in Toronto for another

year. Home games during the coming season will be staged in California as team executives scout a permanent venue in Toronto. Overholt says that the right location needs to reflect the digital environment in which core fans watch the games while also welcoming so-called “stretch fans” —those who are curious but not fully-steeped in streaming gamer culture.

Standard sales and marketing operations need to fill a portfolio of corporate sponsorships. HP and Intel—both partners of

200 million viewers. The original video game was released in 2009, with esports leagues beginning in 2011. Riot Games revealed in September 2016 that 100 million people played each month. Infrequent updates to those numbers have generated speculation that activity has tapered off.

» Overwatch A first-person shooter game released by Blizzard Entertainment in 2016. Game revenue surpassed $1 billion in May 2017, according to parent company Activision Blizzard, and more than 40 million people played as of May 2018. Chris Overholt, club president of the Overwatch League, says that the game was “purpose-built” for esports.

Overwatch League was founded in 2017 and— unlike other esports—the league comprised permanent city-based clubs. The debut season began with 12 teams. The Overwatch League two-day championship in July drew an audience of 10.8 million across all channels, according to Activision Blizzard. Numbers weren’t provided for each specific channel, but TV broadcasts were considered soft. The first night’s broadcast earned a 0.18 Nielsen rating on ESPN, and a Sunday afternoon recap on ABC had a 0.3 rating. The sophomore season, kicking off on Feb. 14, will feature 20 professional clubs. New teams are based

Overwatch League—joined the Defiant for its launch event.

Overholt believes that both companies could become longterm partners.

But moving forward, there is pressure on Overholt to bring in more products and services not directly tied to game play.

Overholt says he’s been talking to potential sponsors from traditional categories such as banking and quick-service restaurants.

“We need to find partners who have media and a willingness

in Atlanta, Toronto, Washington, D.C., Vancouver and Paris, along with the Chinese cities of Chengdu, Guangzhou and Hangzhou.

» Tencent A Chinese holding company that specializes in tech and media. Bloomberg says that Tencent is one of the 10 largest companies in the world with an estimated $50 billion in revenue. In 2017, Tencent announced a $15 billion esports investment plan that would roll out over the next five years. It already owns Riot Games and has minority stakes in Epic Games, Activision Blizzard and others.

Partnerships are in place with Under Armour and the NBA to develop a show featuring the best gamers. Plans are underway to open an esports business park and 6,000-seat esports arena in Shanghai in 2020. The Chinese government might be a stumbling block to future growth, as it has hinted at regulating video games to curb addictive behavior.

» Twitch A live-streaming video platform that hosts esports tournaments. As of May 2018, it had 2.2 million broadcasters monthly and 15 million daily active users. In 2014, Amazon acquired it for $970 million.

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to engage with us around the team and the coach digitally and socially,” Overholt says.

Not only do the Defiant have to pitch esports as a platform for marketers, they also have to compete with rival leagues for opportunities. Brands can and do choose multileague sponsorships, but the marketing dollars are finite. Market Intelligence research firm Newzoo estimates that brands spent about $700 billion on the esports industry in 2018.

R

amon Hermann, director of esports at Tencent America, says marketers should begin their foray into esports by identifing partners that share their values and communication objectives.

“Authenticity matters most in esports so seek out partnerships that feel natural,” he says. “How to do that is the tough part so make sure games or leagues have product roadmaps that align with your own calendar and communications objectives.”

Consider Snickers’ entry to

esports: The brand has deals with three separate esports titles. A year ago, Snickers became a sponsor of FlyQuest, a “League of Legends” franchise owned by Milwaukee Bucks co-owner Wes Edens. Before that, Snickers signed on to sponsor “ELEAGUE,” a multigame esports series broadcasted on TBS and co-run by Turner Broadcasting and talent agency WME-IMG. Snickers brand director Josh Olken says that it also recently partnered with EA Sports’ Madden franchise and is open to more agreements.

“We’re still very bullish about the future of esports and are constantly looking at plans and opportunities to expand our partnership with other teams and leagues,” Olken says, adding that Snickers might eventually sponsor individual gamers in the future.

Snickers has attached itself to athletics since at least the 1984 Olympics, when Mars paid $5 million to make Snickers and M&Ms the official snacks of that

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year’s Summer Games, only to be savaged by nutritionists as out of step with real-life Olympic diets.

Since then, Snickers has inked endorsement deals with FIFA and NASCAR, run Super Bowl spots and partnered with sports entertainment company WWE to sponsor WrestleMania.

Snickers turned its attention to esports a few years ago when it noticed something different about the fanbase. “The brand saw the growing popularity and innate connection with its shared fan base a few years ago,” Olken says.

“The amount of esports players and game awareness continue to grow at record speed— plus, the teams and leagues are still developing, so there are more opportunities to tailor a partnership in esports than in some of the more established sponsorship environments.”

Emerging leagues are developing their own traditions.

Brands teaming with leagues during these early years have an opportunity to shape the foundational myths and more closely embody the definition of a partner. When MercedesBenz signed up in 2017 to sponsor German-based esports league ESL, it helped create the Mercedes-Benz MVP trophy for best player in the league’s premier tournament. The winning player is selected, in part, by fans via Twitter poll and is rewarded with a Mercedes-Benz automobile.

“Esports is considerably more dynamic and, in a positive sense, also much more flexible than traditional sports disciplines,” says Mercedes-Benz’s Weber.

Mercedes-Benz expanded its agreement with ESL in October 2018 and is now ESL’s “global mobility partner” until at least 2021. It celebrated the deal by releasing an ad on YouTube that

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opens with the first-generation computer game “Pong” projected on the side of a 1970s MercedesBenz 450 SEL. The spot follows the evolution of the company’s cars alongside the evolution of video games.

Snickers, Mercedes-Benz and other brands spending ad dollars on esports are trying to reach a young and engaged audience.

“The main benefit right now is relevance, specifically with younger fans,” Olken says. “These partnerships give us a direct line to reach a highly engaged audience that simply doesn’t exist elsewhere.” The drawback, Olken says, is the absence of a playbook for maximizing an esports sponsorship. Snickers has taken an iterative approach, unlike its work with the NFL and WWE where insights play a role in delivering ROI, he says. But Hermann says that the lack of insights in espots can be beneficial, making it a low-risk, cost-effective marketing to iron out their pitches to Gen Z. “Esports is still very much in its infancy as a business,” he says.

“The industry is still learning how to monetize its audience and is well behind other, more mature forms of entertainment like [traditional] sports. There should be ample opportunities for marketers to test their content and get in front of the most passionate game fanbases.”

T

he uncertainty of esports as a marketing vehicle is reflected in a dearth of data.

Market research companies have minimal tracking of esports.

Newzoo, which has followed the sector for six years, is an outlier, as is Nielsen, which just ramped up its tracking of video games by acquiring gaming industry intelligence firm SuperData

Research.

Euromonitor does not track esports. Neither does IBISWorld, which considers the area too niche. The NPD Group has similar sentiments, even though it’s tracked video game sales since the 1990s. “Esports engagement is low among the U.S. gaming audience— only 35% report they have heard of esports and 11% have participated in some way (in the past year),” according to David Riley, executive director of marketing and PR at The NPD Group.

Ipsos, meanwhile, limits its game tracking to events that involve gambling, something that’s almost nonexistent in the esports world. The Luxor Las Vegas, however, just built a 30,000-square-foot multilevel esports arena designed to play host to professional esports competitions and casual gaming.

But according to Ispos VP Jason Allsopp, concerns over the integrity of esports are stopping any significant investment by oddsmakers. Yet boxing, basketball and baseball have all endured fixing scandals. What makes esports’ integrity any different?

“I’m not going to answer that question,” Allsopp says.

D

espite the wait-and-see attitude of some market research companies, esports are inching closer to a mainstream tipping point. Viewership is climbing, with revenue and brands close behind. Perhaps the only thing holding esports back from the cultural threshold is an unambiguous stamp, such as inclusion in broader athletic competitions.

It just so happens a push is in the works. Esports were placed closer than ever to the athletic realm last summer when they were included as a so-called

demonstration sport in the 2018 Asian Games. The event featured competitive esports, but medals won during game play did not count to the official medal tally.

But esports will be a full-fledged medal event in 2022.

The Olympic organizers aren’t yet on the same page, at least not those planning the 2024 Summer Games in Paris.

An announcement from the organizers in September 2018 definitively rejected that notion.

The main hurdle is the gaming content: The president of the International Olympic Committee said the current crop as too violent.

Until esports are legitimized by the livesport world, gamers will need to be content with their own tournaments, and marketers are welcome to join. It’s only a matter of time, Hermann says.

“More people game than ever before and often the biggest barrier for esports is that viewers don’t understand the game and what’s happening,” he says. “That’s a big reason why esports is such a win with the core gaming audience. They understand what makes a professional player so good. We can watch a sport like soccer or baseball and quickly understand what takes athletic talent and developed skills. But if you are watching ‘Arena of Valor’ for the first time, if you don’t understand strategy games, you likely won’t be able to appreciate the skill.” He says that as more gamers flood the market, there’s more cultural awareness—even among nonplayers. “American football is a great example. This is an incredibly complicated sport that most viewers have never played, but it’s culturally ingrained in large parts of U.S. society. Esports is getting there on a global scale.” m

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career advancement

BUDGETS

How Marketers Can Win a Larger Piece of the Budget Marketing ROI can be tough to prove. How can you convince the company to allocate more funds for your team?

BY KERI WITMAN

 keri@cleriti.com

M

ost marketing departments don’t lack ideas or ambition, they lack a hefty budget. Following the old maxim, “You’ve got to spend money to make money,” marketing departments with the capital they need can bring in more leads and increase the effectiveness of their marketing strategies. As a marketing leader, you are competing with other departments for resources. You need a sound strategy and rationale for getting the money you need to accomplish your plan; that often means taking a portion from another team or department. Those dollars need to go where they will work the hardest for your company.

Marketing efforts don’t always show the immediate results that sales team efforts show because marketing exists early in the customer journey. To successfully secure the funds for your plans, your team must show how those plans will be beneficial for the future of the company.

It’s A Numbers Game The best way to get other department heads to reallocate a bit of their budget is to show them what’s in it for them.

How will this investment impact their ability to meet their revenue and profit goals? Prove it with metrics that show your department’s contribution to sales lift, sales-qualified lead generation and market penetration to your target audience. Map out the planned KPIs for the work you are proposing, showing how you plan to measure ROI and present it in a compelling manner.

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Examine these five metrics to build your case:

1

Ratio of new sessions to recurring sessions. Google Analytics can reveal

how many of your site visitors are new and how many are repeat visitors. Both are valuable, especially if they each grew reliably during a certain campaign.

2

Customer retention rate. Measure

customers who have returned to your business to make purchases or use your services. This is a good indicator of brand loyalty in particular.

but you can use increased engagement to demonstrate the effectiveness of your marketing.

5

Total conversions. The ultimate goal of marketing is to convert leads to the next stage of the sales funnel. Show your boss how many customers started as leads.

If you’re able to present instances where spending improved any of these marketing results, you’re on the right path to getting the budget your department needs.

Moving Into the Future ROI results are the first step in justifying a bigger budget, but forecasting how marketing spend can influence your organization’s future bottom line is just as important.

Strategies for anticipating future marketing success:

3

• Use metrics to show how your current objectives will be amplified by a larger spend.

• Show how an increased budget will put your organization ahead of competitors.

• Look at current market trends and stress the need to further invest to keep up.

4

Combining prospective gains with past successes makes for a convincing argument. These measurements can dictate a strategy for improving branding, competing with peers, keeping up with leading-edge trends and, ultimately, generating favorable ROI. m

Cost per lead. This metric is

calculated by dividing spending by leads generated. Inbound marketing can create far lower costs per lead, compared to heavy-spend outbound techniques. Use this metric to show how much money you saved your organization.

Online engagement. Likes, shares

and mentions don’t create revenue,

KERI WITMAN is CEO of Cleriti, fullservice digital marketing agency. She is an active contributor to Forbes.com as a member of the Forbes Agency Council.

Witman has been a panelist on the selection committee for TEDx Cincinnati, has performed stand-up comedy at The New York Comedy Club and was a fundraising mentor for New York City’s Leukemia & Lymphoma Team in Training, recruiting team members through her motivational speaking efforts.

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career advancement

GOAL SETTING

Career Resolutions for the New Year Lose weight, save money…find a new job? It’s not a bad time to set career goals.

BY SARAH STEIMER

 steimer@ama.org

W

hile you’re tacking photos to your dream board and jotting down New Year’s resolutions, it may be a good time to take stock of your career. If you have aspirations of climbing higher in your profession, or if your team is ready to set goals for the year, Diane Domeyer, executive director of The Creative Group, says confidence is key—but take it in steps. Marketing News asked Domeyer to offer her best year-ahead career advice for individuals and teams.

Q

Is it more important to focus on industry-wide trends or professional goals when preparing for the year ahead?

A

When setting career goals, it’s crucial to consider the employment market and your personal interests. To increase your growth potential, you should develop technical expertise in areas that employers seek—like digital marketing, marketing strategy and user research—as well as soft skills.

But you also need to think about what will make you happy and provide the most fulfillment on the job, whether that’s having the opportunity to work on interesting and meaningful projects, experimenting with the latest technology or being part of a collaborative team. Research by Robert Half shows happy employees do better work, are more innovative and enjoy a healthier lifestyle. Who wouldn’t want to make that a goal?

You need to think about what will make you happy and provide the most fulfillment on the job, whether that’s having the opportunity to work on interesting and meaningful projects, experimenting with the latest technology or being part of a collaborative team.

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Q

What are some resolutiontype intentions marketers can set in 2019, whether looking for a new job or a promotion?

A

When establishing career goals or resolutions, I find it’s helpful to first reflect on past accomplishments, passions and weaknesses. This exercise can be very telling and help you determine the next steps in your career, whether

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GOAL SETTING

that’s gaining new skills, pursuing a promotion or exploring opportunities outside your current company. Then, think about specific actions you can take to grow professionally or personally. It’s one thing to reflect, it’s another thing to make a plan.

Q

Setting yourself up for success by looking at the calendar year ahead sounds a little overwhelming. Do you

career advancement

recommend bite-sized goals that you can feel confident about accomplishing or larger resolutions broken into smaller steps?

A

It’s OK to have a big goal in mind, like moving into a management role or landing a new job. But you also need to identify the steps required to get there. Once you do that, set specific, realistic,

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GOAL SETTING

time-bound smaller goals. For example, “I want to gain user research skills by taking two courses in the next six months.” Or, “I want to apply to at least five in-house marketing roles at local companies within a month.”

If you are too vague or try to bite off more than you can chew, you’ll likely forget about the goals altogether or become overwhelmed. Ninety-day milestones are often ideal for establishing a plan to meet a larger annual goal.

Q

If you are too vague or try to bite off more than you can chew, you’ll likely forget about the goals altogether or become overwhelmed.

Ninety-day milestones are often ideal for establishing a plan to meet a larger annual goal.

One of the classic problems with resolutions is that they tend not to last. How can marketers ensure they’re implementing their changes for the long haul?

elbowing others out of the way to meet their goals?

A

A

A mentor—or even a peer—can be a valuable resource for helping you stay on track with your career goals. Set regular check-in meetings to discuss your progress and any obstacles preventing you from moving forward. Explore ways to remove any roadblocks. And don’t forget to celebrate small wins to stay motivated.

Q

We often think of resolutions as a personal task, but how can they work for an entire team?

A

Successful marketing teams are driven by a deeply rooted sense of mission. Identifying a shared goal can build camaraderie and help teams overcome obstacles and resolve disagreements, since the shared goal becomes more important than individual agendas.

Team goals should be specific, realistic and time-bound as well. For example, “We want to increase referral traffic to the company website by 15% in the next two months using social media.”

Q

Resolutions are typically rooted in self care. How can marketers show themselves and others compassion when setting goals for the coming year, rather than

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According to our workplace happiness research, professionals who have good relationships with their coworkers are 2.5 times more likely to be happy on the job than those who don’t get along well with their colleagues.

One way to build a culture of support is sharing team and individual goals at a department meeting. The beginning of the year is a great time to do this.

Document the goals and put them in a place where everyone has access and can track their progress. This increases transparency and accountability. And, after a few months, you can review and celebrate any progress that’s been made.

Q A

Any professional resolution suggestions for 2019?

With more and more digital projects on the horizon, employers are on the lookout for tech-savvy marketing professionals. In fact, according to “The Creative Group Salary Guide,” positions requiring digital expertise are seeing the best pay. When setting career goals for 2019, know that gaining digital skills, like data analysis or search engine optimization, will only increase your marketability and open doors to more opportunities. m

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advertisers’index

ADVERTISERS’ INDEX Quick source for contacting the suppliers in the January 2019 issue of Marketing News.

2019 AMA Marketing + Public Policy Conference . ............................................................. p. 23 URL: h ttp://ama.marketing/MPPC 2019 AMA Training Series ...................................... p. 17 ttp://ama.marketing/ts URL: h 2019 AMA Winter Academic Conference . ................................................. back cover URL: h ttp://ama.marketing/winter2019 AMA Digital Marketing Bootcamp . ....................................... inside back cover ttp://ama.marketing/Bootcamp19 URL: h

AMA Higher Education Marketer of the Year Individual and Team Awards / 2017-2018 Chapter Excellence Awards . ............................................ pp. 6-7 Calls for Nominations currently open: URL: http://ama.marketing/NPMarketer19 http://ama.marketing/4U4019 AMA White Papers ................................................. p. 25 URL: http://www.ama.org/whitepaper

AMA Marketing Management Bootcamp . ................................................................ p. 15 ttp://ama.marketing/MMbootcamp19 URL: h

AMA’s Marketing Resource Directory .................................................................. p. 59 URL: http://marketingresourcedirectory.ama.org

AMA Professional Certified Marketer® Content Marketing Program ........................ inside front cover URL: http://ama.marketing/PCM-CM

Marketing News ...................................................... p. 55 Email: sales@ama.org URL: http://www.ama.org/mediakit

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#OfficeGoals

In 2012, HUBSPOT established its first international office and Europe, Middle East and Africa headquarters in Dublin.

In March 2016, the company appointed Sonica, a Dublinbased commercial fit out company, to manage the complete fit out of the office, working collaboratively with HubSpot’s international design team.

The project was broken into two major phases, with the first being to design and build a brand-new floor for the growing team of 90 people with space for a total team of 160 employees in the product and engineering department. This space references the local environment in Dublin through splashes of familiarity, while individualizing the space to match the needs of the teams.

Three key deliverables were identified: First, to forge a conference and event center to be used by #DubSpotters for everything from internal all-hands meetings to hosting external industry events with industry guests and partners. Second, to accommodate an additional headcount of 120 staff on the new floor plate. Third, to create a dedicated corporate reception to receive guests to the EMEA headquarters.

The space is unmistakably Hubspot’s, but with the local teams putting their unique stamp on the space and making it #Dubspot.

Fit out: Sonica

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PHOTOS: DONAL MURPHY

A peek inside the marketers’ offices that make us drool

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