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The study ‘Marketing in 3D’ examines the role of marketing in driving growth and analyses the differing attitudes of Chief Executive Officers (CEO), Chief Financial Officers (CFO), Chief Marketing Officers (CMO) and senior marketers to the marketing discipline.

The study draws on in-depth interviews with 217 individuals in senior management positions in companies with a turnover of more than £200 million in five Western European countries.

Growth drivers 

Malcolm Wilkinson, head of marketing effectiveness at Deloitte, explained that previous Deloitte research established that around 50 per cent of a company’s share price is based on notions of future growth.

He added that at board level marketing was valued above all other growth drivers including investment in workforce, leadership acquisition, technology and the development of alliances.

While 81 per cent of CEOs saw marketing as a key driver of growth, however, Wilkinson said that there appeared to be a lack of appreciation around the role of marketing in influencing and delivering corporate growth.

Fundamentally different views at board level have resulted in a critical boardroom ‘disconnect’ that presents a major challenge to corporate growth.

Confusion reigns between the role of the marketing department and the practice of marketing in its broadest sense. The study found that only 50 per cent of CMOs believe that their CEO fully appreciates the value of marketing.

Clearly articulated role 

Deloitte also found that 74 per cent of organisations are not reporting marketing measures to the investment community, while 33 per cent of CFOs did not agree that marketing is crucial to the process of determining strategy.

Seventy-seven per cent of respondents believe their employees do not fully appreciate the value of marketing. Seventy per cent do not ‘strongly believe’ that the role of the marketing function is clearly articulated within their organisation.

Deloitte discovered that 88 per cent of all respondents (85 per cent of CEOs, but crucially only 66 per cent of CFOs) agree that marketing is crucial to the process of determining strategy.

Over the next 12 months 41 per cent of organisations surveyed said they were focussing on organic growth alone, 3 per cent on acquisitions and 38 per cent on both.Fifty-five per cent of respondents believe that their organisation does not spend enough on marketing.

The study found that there is a fundamental behavioural disconnect as far as marketing within business is concerned. The realisation is that marketing is central to growth but as yet, this is not reflected in the reality of how the business functions.

Although senior management recognise and acknowledge the importance of marketing in growing their business, their actions are different in practice.

Organic growth

Wilkinson said that the timing of the research was interesting. Although it was undertaken just before the current economic environment took hold, he pointed out that organisations were already seeing that the previous focus on mergers and acquisitions to drive growth opportunities was subsiding.

He added that for many organisations growth was more durable if new customers were acquired organically, or growth was generated through existing customers. The role of marketing in generating demand is central to organic growth.

“Pressure from investors has put management teams in the spotlight. Their ability to grow the business is watched with microscopic detail. CEOs have woken up to the value of marketing and the improved growth potential of the business,” Wilkinson said.

The survey showed that 74 per cent of organisations did not report any marketing measures externally to the investment community which made it extremely difficult for management to convince investors of their effectiveness.

Deloitte warned that renewing and refreshing knowledge on barriers to growth was essential if businesses today were to overcome them. Their study points to three major issues around marketing driven growth: a lack of leadership, shared understanding of the role and effective measurement.

“Everyone in the boardroom has an opinion on marketing and its effectiveness. But future growth of businesses will depend on how firms tackle it today to improve their growth potential for tomorrow,” Wilkinson added.

Deloitte found that 81 per cent of CEOs saw marketing as a key driver of growth, while 46 per cent of CEOs strongly agreed that marketing versus the role of the Marketing function was understood.

Sixty-seven per cent of CEOs believed it would be "a big benefit to marketers to have a formal accreditation for the profession".

CFOs were on the whole more sceptical, with 54 per cent of CFOs believing that the marketing undertaken by their organisation was ineffective. Thirty-three per cent of CFOs did not think marketing was a key driver of growth in their organisation.

Only 14 per cent of CFOs strongly agreed that the role of marketing versus the role of the Marketing department was understood. 

When asked to rate the effectiveness of their organisation’s Marketing department, over half (54 per cent) of all CFOs rated it as less than 60 per cent effective. This compares to just 15 per cent of Marketers and 28 per cent of CEOs.

Glass ceiling for marketers 

Fifty per cent of chief marketing officers (CMOs) did not ‘strongly believe’ that the CEO fully appreciates the value of Marketing. Board level CMOs believed that only 16 per cent of board level discussions were about marketing whereas CEOs believed this to be higher at almost one third.

A third (33 per cent) felt that a glass ceiling exists for marketers and 24 per cent felt that being a marketing specialist could hinder career progression.

Deloitte is also launching an online benchmarking tool that assesses an organisation’s core marketing capabilities as defined by the Marketing in 3D research project. It is free and available on Deloitte’s website, at the link below.

Following a ten minute survey the online benchmarking tool will produce an instant report that identifies barriers to achieving marketing driven growth and key competencies that need to be addressed.

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Related links

• Deloitte
• Deloitte online marketing benchmarking tool