The CMO Survey

Harnessing AI and ML in Marketing In recent years, marketing organizations have increasingly adopted artificial intelligence (#AI) and machine learning (#ML) to optimize workflows and enhance effectiveness. According to the latest findings from the 33rd edition of The CMO Survey, conducted by Professor Christine Moorman of Duke University - The Fuqua School of Business and co-sponsored by Fuqua, Deloitte, and the American Marketing Association, the utilization of AI and ML among marketers has grown from 8.6% in Fall 2022 to 13.1% in Fall 2024. Notably, marketers predict that their use of AI and ML will increase to 34.5% in just three years—indicating a growth rate of 163.4%. Generative AI (GenAI) has emerged as one of the most rapidly advancing technologies within this realm. Its adoption has surged from 7.0% to 11.1% of marketing activities, marking a significant increase of 59%. Notably, businesses within the B2B Services sector leverage GenAI for 16.7% of their marketing efforts, while Tech, Software, and Platform companies lead at an impressive 22.8%. The benefits of AI adoption are becoming increasingly apparent. Marketing leaders have reported enhancements in sales productivity, which rose by 6.6% in Fall 2024 (up from 5.1% in Spring 2024), alongside a 6.3% increase in customer satisfaction and an 8.9% reduction in marketing overhead costs. These metrics illustrate the profound impact that AI is having on operational efficiency and overall performance. Furthermore, as marketers integrate AI into their workflows, they report finding more time to dedicate to strategic initiatives. The perceived impact of AI in freeing up time for non-routine or strategic projects is rated at 3.0 on a scale where 1 indicates “no impact” and 7 indicates a “significant impact,” reflecting a notable increase from a previous rating of 2.4 just six months prior. Interestingly, the prevailing perception among marketing professionals is that new technologies enhance rather than replace human capabilities. Concerns regarding employee attrition risk are currently rated at only 1.8 on a scale from 1 (not at all) to 7 (a great deal), although a projected increase to 2.9 over the next three years indicates growing unease, particularly in the Transportation, Tech, Software, and Real Estate sectors. These findings make clear that the integration of AI and ML is not merely a trend, but a fundamental shift that redefines the capabilities of marketing organizations. Embracing these technologies heralds a new era of productivity, strategic focus, and enhanced market performance.

The Cost of Cutting Corners: Why Marketing Shouldn't Be the First Target in Tough Times When faced with a shortfall in profits, many executives instinctively reach for the budget scissors. A staggering 46% of marketers report that during challenging financial periods, their leaders prioritize cutting expenses over pursuing revenue growth. Only 33% of executives opt for strategies aimed at boosting income, while the remaining 21% attempt to strike a balance between the two. This trend is particularly troubling for the marketing spending. Research reveals that executives are 44.6% more likely to reduce marketing budgets than to make cuts in other areas. While this may seem like a quick fix to meet immediate earnings targets, the long-term ramifications can be severe. Insights from Natalie Mizik’s research highlight a critical point: while trimming marketing expenses might temporarily shore up financial outcomes, it often leads to deeper, long-term challenges. Investors are perceptive; they notice the detrimental effects of reduced marketing efforts, which can lead to negative adjustments in company valuations. #TheCMOSurvey, Christine Moorman, Duke University - The Fuqua School of Business, American Marketing Association, Deloitte

Marketing Budget and Job Growth Rebound Marketing leaders’ optimism about the U.S. economy lost strength, as a three-year-high in confidence levels recorded last spring was dampened by election uncertainty and lingering inflation worries. But despite macroeconomic and political concerns, marketing spending at U.S companies grew by 5.8% during the last year, up from a growth rate of 2.5% in the last survey with projected growth of 8.6% over the next 12 months. This is according to the 33rd edition of The CMO Survey, directed by Professor Christine Moorman of Duke University - The Fuqua School of Business’s and co-sponsored by Fuqua, Deloitte, and the American Marketing Association. This edition, which was conducted September 4-25, sampled 260 marketing leaders at for-profit U.S. companies, 97% of whom hold positions at VP-level or higher. The survey found that overall #marketingspending is bouncing back toward the four-year-high levels notched in Fall 2022, after weaker growth rates for the past years. Despite this, marketing spending as a percentage of companies’ budgets and revenues is lower, indicating that both revenues and overall budgets are growing faster than marketing budgets. Digital marketing spending continues its upward trajectory, rising from 8.9% to 11.1% growth. Marketers predict they will increase digital marketing spending further—by 12.7% over the next 12 months. Drilling down, marketers expect to spend more on customer relationship management (+6.9%), customer experience (+ 5.6%), branding (+ 7.0%), new product introductions (+ 8.1%), and new service introductions (+ 4.3%) in the next year. Traditional advertising spending growth is also positive, at 0.8%, for the first time in two years and only the fourth time in a decade. Marketers report that, in general, they are spending 19.6% more on acquiring customers than retaining them. They also indicate that although their ideal branding budget would be 50% long-term brand building and 50% short-term brand performance, the actual ratio is 31.2% (long-term) and 68.8% (short-term). Marketing organizations grew headcount by 5.3% in Fall 2024, rebounding from an earlier dip of 3.9% growth in Spring 2024. B2B Services companies grew the most (7.6%), followed by B2C Product companies (5.3%). Across industries, Education (25.3%), Banking / Finance / Insurance (14.8%), and Healthcare organizations (9.8%) achieved the most growth, while Mining / Construction (-20%), Retail / Wholesale (-5.8%), and Communications / Media (-4.9%) all shrank. Three reports, available at https://lnkd.in/g5jS4f4, summarize these and other results related to AI, martech, and privacy •      The Highlights and Insights Report: Key metrics and trends over time •      The Topline Report: Aggregate view of results •      The Firm & Industry Breakout Report: Results by sector, size, and online sales

Christine Moorman and Prof. dr. Koen Pauwels offer a diagnosis regarding why #socialmedia spending (as a percent of marketing budgets) has decreased and what marketers can do to get more value from their social media spending. Harvard Business Review, Deloitte, American Marketing Association, and Duke University - The Fuqua School of Business

Director Christine Moorman spoke with Alan Hart about her career and about key findings from The CMO Survey. Listen to the full episode at: https://lnkd.in/e6h6edTC

The 2024 CMO Survey Award for Marketing Excellence is selected by fellow marketers. It is given each Spring to one company that is judged to set the standard for excellence in marketing across all industries and to the companies viewed as setting the standard in their respective industries. #Apple Inc. is the overall winner for the sixteenth straight year. Industry winners include Amazon, Nike, Procter & Gamble, State Farm, and Microsoft. Congratulations! For all new results from the 32nd edition of The CMO Survey, visit: https://lnkd.in/eMZjmc73

Marketers Spend on New Technologies While Battling Usage and Impact Challenges The 32nd edition of The CMO Survey examines reoccurring questions related to marketing spending and performance, marketing leadership, and marketing jobs. In addition, managing marketing technology, generative AI, growth, and sustainability are special topics covered in this edition. Over three-fourths (75.3%) of companies surveyed are using marketing technologies (#Martech), with high-revenue organizations leading. Companies spend 19.9% of marketing budgets on Martech. This is expected to grow to 23.5% in one year and to 30.9% in five years. These and other 32nd edition results are based on a sample of 292 marketing leaders at for-profit U.S. companies, 94% of whom hold positions at VP-level or higher. Approximately 62% of marketing activities use Martech tools, up from 58.4% just one year ago. Yet, only 56.4% of all Martech tools purchased are being used. The emphasis in managing Martech is reported to be on “optimizing existing tools,” “identifying tools for a stronger customer experience,” and “identifying what can be linked together to form powerful capabilities,” while “hiring or retaining talent” and “creating a shared cross-enterprise strategy” are given less attention. Martech impact on company performance is evaluated at 4.7 on a 7-point scale where 1=not at all and 7=a great deal. Consistent with this modest performance, marketing leaders report that actual Martech payoffs are 34% lower than their hopes for these payoffs. Marketing leaders report their weakest performance is on “hiring staff to manage Martech” and on “integrating Martech across other data systems in the company.” For full release details regarding Martech and other results, visit https://lnkd.in/eMZjmc73

CMO Survey Director Christine Moorman and Colleen Hickey report findings from The CMO Survey that marketing leaders realizing gains from #AI in three key areas: increasing sales productivity, increasing customer satisfaction, and reducing marketing overhead costs. However, not all companies are realizing the same gains. They discuss three factors influencing AI returns AI tool adoption time, the company’s digital transformation stage, and its level of experimentation with AI. 

Academic research across almost four decades has provided abundant evidence about the positive relationship between a firm’s #marketorientation or #customerorientation and its financial performance. This includes the collection, sharing, and use of customer information in a firm’s strategy. The CMO Survey finds that this orientation has retained its importance over time. In fact, a comparison of 2018 and 2023 results shows that these levels have increased in companies, on average, with the biggest increases occurring in the sharing of customer information across different business functions and units. How do customer orientation practices vary across companies? Results indicate that the larger the company, the more the company collects customer information on a regular basis. Small companies (<50 employees) reported a 4.9 (on a 7-point scale where 1=not at all and 7=all the time) for collecting data on a regular basis while larger companies (10,000+ employees) reported a 5.7. On the other hand, smaller companies use the information more than larger companies to shape strategy (5.3 for small vs. 5.0 for large), use it to influence the implementation of the strategy (5.4 for small vs. 5.2 for large), and evaluate the strategy (5.5 for small vs. 5.0 for large). This small-large finding is also something we see in broader research on customer orientation. Larger companies tend to be good collectors of information because they have the resources. However, the formality/bureaucracy that often goes with a larger size can interfere with if and how information is used. How well-developed are your company’s processes for collecting, sharing, and using customer information its strategy? 

What’s Happening With the Role of the CMO? With a growing number of responsibilities and increased pressure to drive revenue, today’s CMOs may face more complexity—and volatility—in their jobs Thank you The Wall Street Journal and Deloitte for these insights and ideas. https://lnkd.in/ed6Ch9dp