Dive Brief:
- Marketing leaders continue to take on more duties, including those related to generative artificial intelligence (AI), but only 27% feel their organizations are well-equipped to handle the broadening remit, according to new survey data from McKinsey.
- Top of the agenda for marketers is brand building, cited by 87% of respondents, but only 58% believe their companies are mature in this area. Similar gaps were prevalent for developing full-funnel marketing tactics, clarifying measures of success, ironing out budget allocation and defining creative strategy.
- Barriers to success include internal silos (cited by 36%), a lack of desired budgets for marketing activities (34%), insufficient in-house talent (32%) and incoherent strategic vision (32%). Failing to address these points of tension could mean that brands miss out on emerging opportunities.
Dive Insight:
McKinsey contributes to a growing raft of research that indicates CMOs are being asked to do more with less while contending with long-standing organizational pressures and the emergence of new technology. The consulting group surveyed more than 100 marketing decision-makers, including marketing chiefs, chief growth officers and chief brand officers, at large CPG and retail brands across North America and Europe for its findings.
Brand building, a function traditionally handled by CMOs, remains a top priority, and has seen something of a bounceback in 2024 after an overswing toward lower-funnel performance marketing over the past several years. Other conventional areas of the business, such as content, creative, consumer insights and communications, are today viewed as table stakes by a majority of respondents, per McKinsey.
But the remit of CMOs has expanded considerably amid the rise of channels like retail media and a shifting, fragmented consumer picture. Shopper insights and promotions are now led by nearly two-thirds of marketers (63% and 61%, respectively), while pricing is handled by 35%. The retail, restaurant and CPG verticals are all dealing with heightened price sensitivity from consumers who are battered from a period of inflation, a factor that will likely influence holiday marketing campaigns.
Tracking the success of marketing — and clarifying what key performance indicators matter most — is also a challenge. Rigorous marketing performance management was viewed as a must-have by eight in 10 respondents to McKinsey, but only four in 10 were confident in their execution.
Other tasks under the CMO umbrella include design (cited by 46%), sales and e-commerce (34%), product innovation (24%) and generative AI (22%). The latter category is positioned as transformational but has not been meaningfully realized after nearly two years of hype.
Asked to identify use cases for generative AI, 39% of marketers pointed to driving creative efficiency while personalization at scale and media optimization were each cited by 28%. One-fifth are experimenting with customer experience improvements through channels like search and chat and 22% are attempting to automate the business of marketing.
Previous McKinsey estimates suggest that generative AI could unlock $463 billion in marketing productivity value annually, and 74% of CMOs see the technology as more of an opportunity than a risk. That said, only 5% of marketers are actually building up their generative AI capabilities and just 4% are scaling use cases. Consumer backlash to generative AI has also intensified due to messaging and technological missteps.
While many in the industry are still learning the ropes of on-the-rise tech like generative AI, the broad constraints underscored by McKinsey feel familiar: Lack of budgetary support, talent and cross-functional collaboration have been sore spots for notoriously short-tenured CMOs for years.
