The last few years have shown businesses unimaginable lows and unprecedented highs. The challenges during this time have put business adaptability, flexibility and agility to extreme tests. And as we move further into 2023, these challenges show no signs of retraction.
With economic experts signaling a recession, evolving CX trends and the tech sector harboring its own storms, marketing leaders and CMOs are eyeing a year of new challenges — and opportunities.
But 2023, as bleak as it may seem from an economic perspective, has its own set of opportunities. And marketing leaders who are progressive enough to recognize and capitalize on these opportunities are more likely to earn big wins for their businesses.
“In order to meet the enterprise mandate of driving growth amid continued disruption, CMOs must act decisively to prioritize their investments and their strategy for the year ahead”, said Ewan McIntyre, chief of research, Gartner Marketing practice.
How Uncertainties Are Changing the Global IT Landscape
Geopolitical and economic uncertainties have overhauled almost all areas of business operation.
The IT sector has historically shown remarkable resilience and flexibility in the face of unprecedented challenges. But the global uncertainties have now got to the IT sector as well, with growth slowing down and companies laying people off left, right and center to grapple with rising costs and diminishing ROIs.
The workforce reduction has also led to an increased shortage of critical talent. CMOs and tech leaders are now tasked with getting more work done with fewer people.
In 2022, 70% of organizations experienced a tech skill shortage, and an overwhelming majority of business leaders claimed this to be a significant barrier to technology adoption.
The economic uncertainty has also capped the amount that can go into research and development, possibly hindering innovation in the future.
Besides economic and hiring challenges, tech leaders also struggle to integrate more data within their systems. But with cookies being phased out and a lack of talent needed for managing and analyzing data, the IT industry is expected to struggle with overcoming this challenge.
In light of the evolving tech industry, below are some challenges and opportunities for CMOs in 2023.
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Key Challenges for CMOs in 2023
Leaders are the sculptors of business success. CMOs are responsible for keeping their teams ahead of the technological curve, staying current with the latest customer trends and expectations and creatively resolving all the issues that pop up along the way.
Anticipating the challenges that may arise in the coming year can help marketing leaders be proactive in preparing for them and overcoming them without friction.
Here are three of the most pressing issues CMOs may have to deal with in 2023:
1. Creating Meaningful Connections By Improving CX and Personalization
Nearly two-thirds of consumers want brands to connect with them.
Meaningful customer connections are a huge driver of business success. They foster customer loyalty, which leads to repeat business and positive word-of-mouth marketing.
More importantly, it opens up exceptional business opportunities, such as upselling and cross-selling products and services. Meaningful connections also make businesses more sensitive to customers’ wants and needs. This automatically makes them more agile at improving their product and services and enhancing customer satisfaction and retention.
Better personalization and improved customer experience (CX) are two of the biggest drivers of meaningful customer-business connections.
“Against a backdrop of unrelenting social and economic pressures, marketing leaders look toward a future where smarter marketing leads to deeper, more valuable connections between customers and brands,” said Andrew Frank, distinguished VP Analyst in the Gartner Marketing practice.
When customers feel that a business understands and caters to their unique needs and preferences, they are more likely to develop a profound sense of trust and loyalty toward the brand.
Similarly, a positive customer experience can play a huge role in fostering a customer connection. Customers who have a good experience with a business are more likely to return to it, deepening the connection.
This is perhaps why CX was the top priority for almost all the 1,900 business professionals surveyed recently.
Here’s the challenging part, though:
Positive customer experience and robust personalization both rely on data.
With cookies going away, businesses have limited access to third-party data. Lower marketing budgets may also restrict their capacity to leverage expensive first-party data.
And even if a business has a database brimming with powerful data, it may lack the talent needed to retrieve value out of it given the global tech talent shortage and workforce layoff.
So, while improving customer experience to foster stronger customer connection is critical, CMOs may have to gain access to valuable data and build the ability to use it well.
This may be a challenge.
2. Speed up Time-to-Market in Organizations
Few things play out in the marketers’ favor as much as an agile time-to-market (TTM).
Quick TTM helps marketers be more proactive and responsive to the changes in the market and customer behavior, allowing them to jump on new trends and quickly adapt to evolving market needs. Once you speed up your TTM, you also enjoy the first-mover advantage, which may bring a quicker return on investment and reduce financial risks.
However, with the issues firmly rooted in the modern business landscape, speeding TTM up can be a significant challenge. Improving TTM and capitalizing on the benefits that come with it depends on the availability of tech talent.
With a shortage of tech-enabled professionals, marketing leaders may remain restricted in their capability of driving powerful pre-product launch campaigns. This may not only delay TTM but may also impact the expected ROI.
Besides that, nearly 30% of major advertisers claim they are cutting their ad budgets. This only adds to the marketers’ troubles.
With limited monetary and human resources, CMOs may struggle with hitting TTM benchmarks and benefiting from an agile time-to-market.
“When you have a fast time to market a product, your company is first to market and the product launch has more impact, which again results in greater sales and profit margin compared to your slower competitors”, writes John Carter, founder of TCGen.
3. Maintain Balance Between Workforce Transformation, Employee Experience
Workforce transformation entails restructuring an organization’s workforce to improve efficiency, productivity and competitiveness. With the evolving global technology landscape, workforce transformation is no longer a choice but a necessity.
CMOs need to automate manual tasks, adopt flexible work arrangements, improve internal structures to uplift communications and eliminate silos, and find ways to reskill and upskill their teams to prepare them for new tech challenges.
However, such rapid workforce transformation may have repercussions regarding employee experience. Workforce transformation can often harm employee experience. It may lead to a lack of clarity on job roles and responsibilities, which may reduce productivity. Some employees may also resist changes in how your team and organization operate post-transformation.
Most importantly, as CMOs adopt automation, employees may fear losing their jobs, which, once again, may impact creativity, a critical variable for success in marketing.
So, while workforce transformation remains a priority, the ability to execute it without shattering the employee experience can be a challenge for CMOs looking toward aligning their teams with modern business requirements.
Related Article: How CMOs Can Master Their New Job: Leading Customer Experience
Key Opportunities for CMOs
Once we know the challenges that may impact CMOs in 2023, it is important to identify critical opportunities as well that can help them deal with these challenges, overcome them and stay resilient even as economic headwinds rock their ship.
Here are some areas where CMOs may find exceptional growth opportunities:
Digital Transformation: Investing in DX
US companies invested $1.85 trillion in digital transformation in 2022. And the DX trend is nowhere near slowing down in 2023.
Investing in DX may help marketing leaders in several ways. Digital technologies may help them reach, engage, and convert more customers. Think social media targeting. This may help marketers identify and target specific audience segments and help them get more out of a limited advertising spend.
Besides that, technologies such as artificial intelligence, machine learning and big data analytics can help marketers understand their customers better and deliver more personalized experiences. These technologies may also be extremely helpful as they deal with a lack of human resources to delve into data.
Automation, a key consequence of DX, can help take the load off whatever the workforce CMOs are left with, compensating for a lack of tech skills and increase efficiency and cost savings.
Performance Marketing: Streamlining Marketing Budget
Performance marketing allows marketers to pay only when the campaigns have driven measurable results. This allows them to streamline their marketing budget and spend only in areas that help them generate viable results.
Performance marketing is likely to be more doable for CMOs in 2023 with the availability of technologies like programmatic advertising and AI. Programmatic advertising, which builds on automation and data to target and optimize ad delivery, may help marketers kick-start their advertising campaigns on solid ground and improve them progressively for better results.
This can also make it easier for marketers to reach the right audiences at the right time and increase the efficiency of their performance marketing campaigns.
Improve Policies Around Data Privacy and Security Regulations
Customers are increasingly concerned about data privacy — 80% of consumers report their willingness to abandon a brand if their data is used without their knowledge — 72% of US shoppers would be less likely to buy again from a brand if they feel that a brand is not responsible with their data.
“Over the last two years digital transformation has become a necessity, especially for customers making purchases. And during that time across the board we saw consumers looking to brands for transparency on their core values, holding them more accountable to their word than ever before. If you think about it, trust is a key pillar in any meaningful relationship”, said Brian Solis, VP global evangelist at Salesforce, in conversation with CMSWire.
While this may seem challenging, it is an opportunity in disguise. Building more robust data privacy policies and forging stronger security regulations can help CMOs build customer trust. Leveraging customers’ privacy concerns and fostering healthy data practices, CMOs can establish themselves as stewards of personal information.
Empowered with unrelenting customer trust, CMOs can hit their customer retention benchmarks and drive better revenues.
Conversion-Focused Marketing Campaigns
With limited marketing spending, it stands to reason why marketing leads may consider directing their budgets toward conversion-focused marketing campaigns.
Fine-tuning marketing campaigns optimized for increased conversions can help drive specific actions, increasing ROI and triggering customer growth.
Final Thoughts on CMO Challenges in 2023
CMOs and business leaders are looking at a tumultuous year ahead, marked by economic and geopolitical uncertainties. An evolving tech industry in the wake of the challenges driven by these uncertainties is also adding to modern marketers’ troubles.
Fostering customer connections with diminishing access to data, executing workforce transformation to stay competitive without shattering the employee experience, and ramping up TTM may be some of the most challenging hurdles in a CMOs path this year.
But growth-driving opportunities like digital transformation and performance marketing may alleviate some of these struggles and help marketers hit their goals, despite a harsh setting.
