|MARKETERS FAIL TO INNOVATE|
Oranjestad, August 9, 2013 - Nearly 90% of brand owners are failing to consistently invest in marketing innovation, according to a new study by Forrester.
The insights group polled 45 leading marketers, and found that only 11% had a dedicated pot of resources earmarked to fund more experimental communications techniques and strategies.
"Budget is both an indicator of intent and lifeblood for these programs to succeed," warned Bert DuMars, a principal analyst at Forrester, in an official blog post.
In further demonstration of this point, fully 95% of firms that set aside funds for innovation either "mostly" or "partially" yielded a favourable return on investment from these activities.
The news comes in the same week that Warc launched its Innovation Casebook, a report and analysis of the latest communications innovations of the most progressive brands.
One cause of the current wider malaise, suggested Forrester, could be that only 20% of executives felt they had the backing of senior executives to try new things. A rather larger 40% were, however, crowdsourcing ideas from customers.
DuMars divided companies into four clusters. The first was "risk-averse" firms, which are based on "command-and-control" models due to heavy regulation or dominating their sector, and only innovate if there is no other choice.
Secondly, "pragmatists" - some 60% of organisations - are hesitant and rely on consensus, meaning they typically lack agility. While their marketing is working at present, they are vulnerable to smaller, nimble rivals.
A third cohort, the "experimenters", featured enterprises that are extremely active in testing new models and tactics, but generally lack a long-term strategy.
The final segment of businesses were "customer-obsessed", and have an unrelenting focus on the lifestyles, wants and needs of their target audience, alongside developing a corporate culture that encourages taking calculated risks.
Just 3% of brand owners fitted this description, including soft drinks firm Coca-Cola, food group Nestle, restaurant chain Chick-Fil-A and convenience store network 7-Eleven.
"They have established a foundation through strategy, organizational development, and budgeting that reflects their commitment and industry-leading programs," DuMars said.
More specifically, he praised the 70-20-10 rule employed by Coca-Cola, where the company commits 20% of its marketing budget to "new" techniques and platforms and 10% to "what's next", or cutting-edge ideas.