CMOs need to rebalance their teams and resources or risk digital failure. They are overweight in traditional marketing and light in digital. There are three brand marketers to one digital marketer on average, and that person becomes the numbers person, "hammered down with no time for strategy".
That's the view of former Fairfax marketplaces acquisition and analytics director Nikhil Jain, who left the publisher after five years in 2011 to start his own agency, Digital Minds Group, because the switch to digital was happening too slowly.
With some big corporates spending up to $500,000 each month on paid search, and arguably lacking the resource to efficiently handle that and their strategy, there's a big opportunity, reckons Jain.
Jain was "running an internal agency anyway" at Fairfax. That unit took RSVP from the number three dating site to the number one within about three months, he claims, "and the other two exited pretty quickly".
Then his team took on pretty much everything bar news properties. But although the company grasped that digital was its future, Jain said at that time it wasn't quite ready to do everything digital-first.
"There was an overarching [traditional] publisher mentality and it was not moving as quickly as you would want it to in a rapidly changing environment." Budgets were swinging in digital's favour, he said, "but it was a transitional phase ... You could see that the business needed to re-evaluate the mix of the teams and allocate more digital resources. But that takes time in a big traditional company".
So Jain formed the agency. Fairfax is on the roster, as is News and Qantas. Rate City, part owned by Mi9, is the latest addition. Jain said it is about helping corporates rebalance resources and take a digital first mindset despite structures that can hinder it.
He reckons the firm lets technology do the grunt work so it can hire "senior search marketers, strategists that understand the category, product and opportunity. Not just little doers".
It's not just search and optimisation, he reckons, but advice and analysis as well as the reporting "that takes up a lot of time at most agencies today". The firm has just done a deal with Kenshoo to automate optimisation based on different attribution models – i.e. the opposite of last click. That frees up time to get away from "focusing on allocated budget to looking for other revenue streams".
He said that marketers had grasped multi-point attribution – all the other touch points that help in driving people to make a purchase – "but it is conversational and not action".
Jain said that the problem for brands is that there are "two flavours of marketing, with one camp in traditional brand marketing and the other in direct response. The two need to meet somewhere but [the shift] is gradual".
Companies must reshuffle the marketing pack to stay ahead of the game in digital, Jain said, citing a three-to-one traditional to digital ratio.
"In a corporate environment the digital person becomes the numbers person, not just for digital but for everyone in the organisation and they get hammered down by the numbers requirement.
“It leaves no time for strategy. CMOs have to reevaluate the team structure and take a digital-first approach. You can't pick or chose whether to be part of digital."
The shortage of top digital talent is therefore an opportunity for firms like Jain's. There may be much talk about blue-chips taking digital in house, and some are, but "they need someone with the head space to own the strategy" or they will just be firefighting.
"The recent growth of digital media and budgets is totally disproportionate to the resources in this area,” Jain says.
“While companies can think about replacing traditional above-the-line campaigns with digital, they have not [grown internal resources] to keep pace. People are working in teams with no time to develop. They can't take the business into a positive environment because they are not allocating the right resources."
He reckons automating the the grunt work, “pulling away the manual labour” and allowing digital marketers to come up for air is probably the best place to start.
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