One of the key drivers of any economy is the marketing sector. Marketing drives sales and sales drive employment. “The Irish advertising market has been hit by a sledge hammer over the last four years and it is hampering the nation’s economic recovery,” says Alan Cox, chief executive of Core Media Group. You can read Core Media’s outlook for 2012, a must read for anyone working in, or studying, marketing. Download: Core Media’s outlook for 2012 (large PDF).
Alternatives, the marketing recruitment specialists recently carried out a survey. By asking Ireland’s top marketers for their insight, the poll offers a view of how Ireland Inc. will trade over the coming year from a marketing perspective. Below are the key findings.
Snapshot of results:
• Overall, the economy and outside factors remain a concern. Respondents were asked to name one single thing that the government could do to boost business. An immediate reduction in VAT was the overwhelming answer, along with a plea to focus on growth stimulation.
• 29% feel that business is doing better than this time last year, 35% rate it the same. Those finding business worse than one year ago dropped from 47% to 36%-which although still high, is a marked improvement.
• However customer sentiment has declined significantly with 75% finding that consumer sentiment is worse or a lot worse than a year ago. Note however that the survey was carried out during budget and VAT increase announcements and this may have influenced results.
• Ireland’s marketing community remains muted about the potential return to growth for Ireland. The return to growth that was expected to be seen in 2012 and 2013 has been pushed back to 2014 at least.
• The focus on developing new products or services for existing customers has almost doubled since December 2010. This positive signal of marketing investment in NPD is noteworthy, particularly within the FMCG sector.
• With regard to areas of spend, Above The Line communications still unsurprisingly remained the number one area of marketing spend for 2012, but with 36% reducing spend in this area. Again unsurprisingly, 73% of respondents recorded an increase in digital spend in the past year, with areas such as direct mail and email marketing also holding up well.
• For key strategies senior marketers will be pursuing in 2012, we see the focus on customer retention (60%) and cross or up-selling (44%) continue. The focus on developing new products and services also continued to increase.
• Top issues remain, as in previous surveys, the economy and the pressure on achieving objectives with current marketing budgets.
Marketing teams and budgets
• Pressure on marketing budgets remains-but it’s improving. One quarter of marketers will see their marketing budgets increase from 2011, with 30% retaining their existing budget. 44% will see budgets decline a little or a lot, but this is still an improvement on last year where 58% expected budgets to decline.
• Marketing team sizes remained the same for almost half of respondents in 2011. Just over a quarter reduced teams –with many having had to actively downsize in 2011- but the same amount increased team numbers in 2011.
• In 2012 61% plan to keep marketing team sizes the same, 19% plan to reduce teams and 15% plan to grow their teams.
• 37% of senior marketers acknowledge that they do not have adequate resources to implement their marketing plans and most will get the current team to handle the workload. This will continue to place pressure on already often under-resourced teams. Of those under-resourced 30% plan to bring in interim, full-time or consulting resources.
• Should hiring opportunities arise, digital marketing (57%), CRM (38%) and strategy and planning (21%) skills are the areas that marketing management would most like to bring into their organisation.
• With regard to marketing salaries, they seem to be stabilising a little more compared to the previous year, with 62% staying at the same levels as 2010. 20% reduced marketing salaries, but this is still an improvement upon a year earlier where 33% of marketing departments had salary decreases. 18% of respondents increased salaries in 2012 by 1-10%. 1/3 of respondents paid no bonuses.
• Alternatives experience is that salaries are tightly managed and there are few increases, except in areas such as digital. However, company’s expectations are now more realistic and they know that top marketers with big brand experience will still attract a competitive package.
Board marketing and conclusions
• 50% agree that marketing is playing a key role in Ireland’s economy. 60% of marketers say that marketing is represented at board level and 65% say it is respected in the organisation. 72% say that marketing is a key investment area for them.
• However for a sizeable minority, there is also uncertainty about the function of marketing for many of Ireland’s most senior marketers: 50% of senior marketers believe there is a glass ceiling for marketers to move up to CEO level, in 40% of cases marketing is not represented at board level and one in five feels marketing is not respected in their organisation.
“There’s certainly a diversity of opinions reflected in the new Alternatives Marketing Watch survey,” says Sandra Lawler, Managing Director of Alternatives. “On a positive note it’s worth remarking that while only 12% had planned to increase their marketing team numbers at the beginning of 2011, 27% of companies surveyed actually increased their marketing teams by the year end. Add that to the 46% of businesses where marketing team sizes stayed stable and we see that 73% of marketing teams either shed no-one or grew. So while it’s not all rosy, and there are still tough times ahead for the marketing community, we are getting on with the challenges of business and ensuring marketing plays a key role in its recovery.”