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They’re not buying it: A leader’s guide to better marketing tactics

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ESSENTIALS FOR LEADERS AND THOSE THEY LEAD

Brought to you by Liz Hilton Segel, chief client officer and managing partner, global industry practices, & Homayoun Hatami, managing partner, global client capabilities

The vagaries of consumer sentiment are keeping marketers on their toes. Our recent research shows that in response to the US economy’s mixed signals, shoppers are behaving in contradictory ways: they are still spending but trading down to less expensive products, while splurging occasionally. And increasingly, consumers are omnichannel—they buy on the web, in physical stores, on social media, or through emails, apps, and other digital spaces. In this complex environment, leaders may find it challenging to identify the precise mix of marketing strategies for their target consumers. We’re here to help.

AN IDEA

An image linking to the web page “The power of partnership: How the CEO–CMO relationship can drive outsize growth” on McKinsey.com.

Make marketing a growth partner

“Many C-suite members underestimate marketing’s potential to create growth, despite the rapid growth in marketing capabilities,” observe McKinsey senior partner Marc Brodherson and colleagues. For example, a fast-food company was spending $150 million a year on marketing, but its brand was almost “invisible,” in the view of its CEO. The solution was to hire a marketing leader with a clear mandate to innovate and use marketing to expand transactions and sales. By working with the finance function to quantify marketing’s impact, the chief marketing officer (CMO) was able to help the company accelerate its year-over-year top-line growth. “Companies with CEOs who view marketing and branding as one of their top two growth levers are much more likely to experience growth than those who do not,” note the McKinsey experts. “It’s imperative for CEOs and CMOs to prioritize the same metrics to ensure they are working toward the same objectives.”

A BIG NUMBER

That’s the number of possible ways to take an investor approach to marketing, according to McKinsey senior partners Julien Boudet, Kelsey Robinson, and their coauthors in a McKinsey Quarterly article on how marketing can strengthen resiliency. Marketing budgets are often the first to be cut during uncertain times, but this could be a mistake. A better move may be to adopt an investor mindset: trimming inefficient spending and reinvesting the savings in areas with greater potential for returns. A telecom company saved $65 million a year by streamlining its advertising agency model—it retained a few larger agencies for inspiration and ideas but set up an in-house agency and new partnerships for routine and low-cost work.

A QUOTE

“Modern marketing is the ability to harness the full capabilities of the business to provide the best experience for the customer and thereby drive growth.”

That’s McKinsey partner Dianne Esber and colleagues on what makes today’s marketing initiatives different from those of the past. “It’s less about changing what marketing does and more about transforming how the work is done,” they say. For example, traditional one-size-fits-all campaigns may need to be replaced by more nimble content creation that can be adjusted as needed. Marketers may also need to hire content producers and designers who are more data-savvy than was necessary in the past. Our research indicates that companies that successfully integrate data and creativity grow their revenues at twice the average rate of S&P 500 companies.

A SPOTLIGHT INTERVIEW

An image linking to the web page “Modernizing technology in the service of the customer” on McKinsey.com.

Forming unique, highly personalized connections with customers is a critical ingredient in marketing success. Long before generative AI made hyperpersonalization possible, executives at McDonald’s were digitizing the company’s restaurants to engage closely with customers. “We have the ability to personalize the menu through our outdoor digital menu boards,” says Daniel Henry, the former executive vice president and chief information officer at McDonald’s, in a discussion with McKinsey senior partner Naufal Khan. “The opportunities to personalize are powerful. How do we give the customer trending items? How do we merchandise to them in a targeted way?” Customers are at the heart of the company’s acquisitions, technology deployment, and data management practices, Henry adds. “When you’re a product-obsessed organization, you think about the consumer before the technology. Technology by itself means nothing.”

LOST IN TRANSLATION

An image linking to the web page “Urban world: The global consumers to watch” on McKinsey.com.

Many cross-cultural marketing gaffes have become the stuff of corporate legend. Urban myths or not, these faux pas illustrate that even the most sophisticated marketers can stumble when products and services are released internationally. Cultural differences can be subtle, unexpected, and nuanced across countries and regions, so a sweeping “Asia” or “Europe” marketing strategy is likely headed for failure. As the world’s consumer landscape undergoes dramatic shifts, companies may need to define their target markets with ever greater precision. For example, our research shows that in an urban setting, businesses must “continually adapt to evolving demographics and consumption patterns of cities—and even in neighborhoods within cities.”

Lead by marketing effectively.

— Edited by Rama Ramaswami, senior editor, New York

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by "McKinsey Leading Off" <publishing@email.mckinsey.com> - 04:17 - 6 Nov 2023

Archives

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info@learn.odoo.com

APC Back-UPS Connect is here

Coming Dec 4-6: Take a deep dive into AI and HPC at this oneAPI DevSummit.

They’re not buying it: A leader’s guide to better marketing tactics

Make marketing a growth partner

“Modern marketing is the ability to harness the full capabilities of the business to provide the best experience for the customer and thereby drive growth.”

Introducing Insights to Impact

Archives

in

info@learn.odoo.com

APC Back-UPS Connect is here

Coming Dec 4-6: Take a deep dive into AI and HPC at this oneAPI DevSummit.

They’re not buying it: A leader’s guide to better marketing tactics

Make marketing a growth partner

“Modern marketing is the ability to harness the full capabilities of the business to provide the best experience for the customer and thereby drive growth.”

Introducing Insights to Impact﻿

Introducing Insights to Impact