Marketing is a discipline that benefits immensely from the front lines of the digital revolution. It continues to evolve from the days of brand management and advertising. Moreover, it is complicated. Being the architect of growth is now the CMO's principal role.
The Evolving Role of Marketing
“The increased use of first-party data, the growing privacy regulations around it, innovative approaches to data governance: these are all part of the day in the life of a modern marketer.”— Biljana Cvetanovski
Today, their area huge volumes of analytics for personalization, targeting, and segmentation. However, along with the increasing use of first-party data, the CMO needs to worry about growing privacy regulations and data governance. Furthermore, the analytics to mine data and create actionable insights to unlock new opportunities are readily available to all marketing professionals. You need to invest in the capabilities and systems to change the marketing organization.
In 2017, digital-media spending outpaced TV-media. Interestingly the increase is driven by mobile. However, consumer loyalty is declining. Disruptive competitors appear everywhere. Notably, they are merely a click away. Many marketers struggle to keep up with that pace of change.
The Evolving Role Of The CMO
“Ultimately, the CMO is being judged on how well they can grow the business. ” — Biljana Cvetanovski
The CMO has always driven advertising and branding that lead to growth. Today, they are accountable for building brands, growing loyalty, and improving the end-to-end customer experience.
Moreover, they are accountable for designing and defining what it is that the rest of the organization is aspiring to achieve. The CMO has access to many approaches to deliver on that growth agenda. However, the essential metric for judging the CMO is growing the business.
Today’s CMO needs to be able to manage their profit and loss. They need a growth mindset that delivers a return on every investment that they make. The CMO needs an agile operating model to be more agile. Agile marketing is the ability to test and learn rapidly.
They need to
- be an agile leader
- work in true partnership with the chief technology officer
- attract and develop the talent to drive world-class performance
- inspire their colleagues in the C-suite to aspire to and have the risk appetite to foster this culture of experimentation, bold creative thinking, and the delivery of growth
The New CMO Talent Stack
None of the above is trivial. Interestingly, our performance trait analytics predict the success of the new breed of marketers to fill these critical roles. Moreover, we can find the hidden potential that exists within your organization that needs performance attributes for these challenges.
The CMO must have the ability to influence across the C-suite. However, they cannot drive the company growth agenda on their own. So, building a strong working relationship with the rest of the C-suite is imperative. Thus, the successful CMO will have the closest relationship with each member of the C-suite. They also need to work closely with the board.
The CMO needs to be expert in defining the strategy and thrive with broader P&L responsibilities. Moreover, they need to own everything from the marketing agenda to customer experience to product to pricing. Furthermore, they also need to much better at finding and developing talent in house and enable a new generation of talent that balances creativity and analytics.
Growth Companies Have CMOs With The Right Talent Slack
According to Mckinsey’s Jason Heller, growth companies are eight times more likely to have a CMO with this talent stack. Companies with these CMOs are twice as likely to have high growth than companies that those with traditional CMOs. Moreover, these organizations are three times more likely to attract what talent who can integrate data and creativity. These folks understand and appreciate the importance of reaching across the function. So, if they are in data-driven roles, they reach across into the creative and content functions. When they are in the creative and content functions, they reach across into analytics and embrace these new capabilities.
Also, these CMOs are three times more likely to have dedicated analytics resources. More importantly, this control ensures the critical analytical capabilities that are needed to make that integration happen. They facilitate data and creativity work together every single day and have the management systems to support integrated functions. This approach drives the growth, and even further enhances the capabilities. While many organizations have those capabilities, few are integrating them properly.
Critical Relationships for The CMO
As with any role, the essential relationship to build is with your boss. So, the CMO needs to focus on ensuring that the CEO is clear on- and support their role regarding the:
- growth agenda
- activities that they need to champion or support for marketing investment
The Chief Financial Officer (CFO)
The second critical relationship is with the CFO.
Interestingly, only 45 percent of CFOs believe that their CMOs are delivering on their organizational growth agenda. However, the CFO makes fiduciary, responsible decisions about corporate investments. Thus they serve as the gatekeeper for the marketing budget.
“CFOs are really looking toward their CMOs to help them translate marketing metrics into the business objectives. ”— Biljana Cvetanovski
So, the CMO needs to invest in measurement and clearly articulate the return on that investment. Invest in measurement and analytics around investments. Moreover, earn a credible level of trust with the CFO. Keep them informed about what is going to happen. CFOs are looking for their CMOs to help them translate marketing metrics into the business goals.
It is not focusing on brand awareness or reacting to creative campaigns, or what the customer-sentiment analysis tells them. Instead, facilitate the CFO's understanding of how precisely the metrics will give you predictable and accountable growth. So, the CMO needs to focus on,
- how they drive the top line
- the parameters that will drive the business forward
- what is driving growth
While the percentage of board members who have marketing experience or marketing background is on the rise, the bench strength is generally shallow. So, the interaction between the CMO and the board is essential.
Moreover, the experience of board members is likely old-school. Board members often think they are a marketer. Notably, everyone has an opinion. The CMO’s interaction needs to be practical, proactive, engaging and respectful of roles the:
- CEO has ultimately is responsible for the growth of the company
- CFO is the gatekeeper to the funding
- the board effectively hires and guides the entire C-suite — they need to support the big bets to drive growth
The Chief HR Officer (CHRO)
It is a global struggle to attract top talent marketing. There are always pain points related to attracting and keeping top marketing talent. Attracting top talent is a complex endeavour. It requires much more than going out and recruiting and paying people a competitive compensation structure. The CMO and CHRO need to make recruitment about the organization’s value proposition, culture, interaction with the rest of the marketing organization. The CMO can advocate that CHRO is enabled and empowered to do what it takes to get the right talent. High performers outperform average performers by 400 percent. So, it is in everyone's interest to have the ability to hire and keep top performers.
Interestingly, our analytics show that expressive people get hired at a much rate than others. However, while self-expression is one of the discrimination performance traits needed to be a high performing marketer, the other discriminating attributes include leadership, innovation, assertion, intuition, and presence. Our performance benchmarks include about 25 performance traits.
The Chief Technology Officer (CTO)
While the CMO is responsible for improving the end-to-end customer experience, designing, and defining the product, the CTO makes it happen. Deep involvement at first stages, supplying ongoing customer feedback makes it possible for the CTO to contribute at a much higher level.
Agile Leadership And Methodologies
Agile marketing is an exception. Increasingly more marketing organizations are adopting agile. They start with some of the addressable, closed-loop parts of their marketing.
“Agile marketing is one of the most effective ways of modernizing traditional marketers who have operated in slow, waterfall processes for their careers.”—Jason Heller
Change is challenging. The individuals who have been in marketing for over ten years tend to be comfortable in a certain way of working. Moreover, agile upends that comfort. It repurposes a marketer as an operator than their traditional role as manager. So, a change in management may be needed. We recommend that you assess the performance traits of the existing staff to determine the strengths and challenges they have in transforming to agile. With these insights, they may be able to make a successful transition — best for all concerned.
Furthermore, agile marketing is one of the most effective ways of modernizing traditional marketers using waterfall processes for their careers. When creating content, media, analytics, technology, and marketing operations are together in a team — magic happens. The diversity of thought creates breakthroughs at the intersection of disciplines. This structure makes it possible to create and launch tests in a matter of days versus a matter of months.
Now that is not true in every channel. That is not true for every client. There are scale implications there. However, this is the operational reality of how to drive growth more effectively.
Brand and Creativity
Technology evolves the way that we:
- develop, improve, and deliver creative ideas
- engage consumers
- create connections with consumers — the emotional connection, that creativity, specific messaging, and imagery
Given that there is less consumer loyalty, these matters are more relevant today.
Creativity is a subjective topic. However, you can quantify the total return to shareholders and organic growth. These indices correlate to the organization’s trajectory. However, research shows that advanced capabilities alone are not enough to drive growth. It requires the integration of data and creativity. Companies that integrate creativity and data grow at twice the rate of their peers. Moreover, they treat data and creativity as equal partners. They hire and nurture talent who are eager to contribute to this integrated approach.
Furthermore, they adopt a new operating model—utilizing agile marketing. The test and learn, and curiosity is at the core of the organization and the operating model.
Zero-Sum Game Trap
When the marketing organization spends more on data analytics, data science, and talent, the tendency is to have fewer dollars available to spend on creative, copywriting, design, and big campaigns. It is not a zero-sum game. Investments in data and marketing technology unlock new sources of value. So, taking a P&L approach, the investment in marketing opens new opportunities will require more investment.
However, most companies make it a zero-sum game. They have no embraced the accountability and a predictive quality to the value that they are going to unlock. However, once you get to that point, making a business case for marketing investment is just managing P&L Moreover, as the investments in technology, data, customer experience, media, and creative increase, if they can forecast the outcomes. Investments are not a zero-sum game. So, going beyond the budget is possible.
The old paradigm is to build creative campaigns throughout the year. However, there is a shift toward more iterations of those campaigns. This approach includes more experimenting, more segmentation, more always-on campaigns.
Our goal alignment program, GAP™, shifts the dynamics and ensures all investments compete on the same basis for the limited resources. GAP™ ensures that all human, financial, technical, and marketing resources increasingly contribute to the achievement of the organization’s goals and strategies.
Agencies Need To Change
Marketers have a much more conscious, deliberate, and structured approach to how they work with their agencies. There are three significant shifts,
- Increase the insourcing of creative and content. This approach includes the simple creation of quick, cheap, fast, and low-risk-type content. Insourcing is less time-consuming, less costly, than engaging the agency. A company gain expertise there is insourcing of the big creative idea as the theme for future campaigns.
- There is an evolution of the agency ecosystem. The explosion in the types of capabilities that you need for marketing is driving the changes. Elements include everything from programmatic to media planning to ideation. It is increasingly difficult for one agency to supply the one-size-fits-all solution for marketers. So, marketers are very selective in choosing specialist agencies to meet their specialist needs.
- There are more joint ventures and partnerships. The structures range from tying the incentive structure for an agency to the success or performance of the marketers or the organization. However, there is an opportunity for agencies to invest in or co-creating the intellectual property of clients. So, they need to build close relationships and tie together performance metrics.
Agencies are at a crossroad. They must reestablish trust with their clients. However, there is controversy around transparency in the agency world. Agencies could be more relevant and help clients navigate today’s complex, competitive world.
“Most companies are still repurposing their content from traditional channels. So, this is a lost opportunity for reaching your consumer in a more mobile, tailored way.”—Jason Heller
There are three significant implications,
- Marketers require the explicit consent of consumers. So, this limits their ability to use the data. While they have been building their databases over the years, regulation reduces the impact and the value of these assets. Marketers need to think about marketing permission before they can market products.
- Marketers need to rethink the value exchange with customers. What was once a checkbox, marketers need to push their thinking to say, “What is the value? What is the value added if a consumer checks the box? Moreover, what’s the value add of them joining my database?”
- In regulated markets, third-party data may be limited.
Furthermore, there is this need to create a value exchange with customers. Marketers need to think about customer experience and the value exchanges deeply. They need to gain better capabilities in how they engage with customers and deliver the right experiences.
Marketers' Significant Challenges
At the top of the list is building in the growth leadership mindset:
- building in that culture
- ensuring collaboration with their C-suite peers and the rest of the organization
- making sure that they have clarity of metrics and roles
- becoming robust in terms of how they think about the business organization
Measurement is crucial as marketing is stepping more explicitly into the role of driving the growth agenda. So, if a CMO wants to be accountable, they must make measurement a priority.
Measuring marketing effectiveness and ROI has been around for years. However, the proliferation of different channels and touchpoints has made measurement more difficult.
The execution of creative across all these various touchpoints and channels is a significant challenge. There is much discussion regarding the need for digital-first content. However, most companies repurpose their content from traditional channels. Moreover, this is a lost opportunity for reaching customers in a more personalized via mobile technology. Marketers need to engage their customers more deeply—in the touchpoints where and how they want to interact. In the age of personalization, marketers need to create individual experiences across all the available channels.
The next phase of marketing transformation is a move from doing to being. It is a move from companies doing agile marketing to companies being agile marketing organizations.
The shift is from doing things that are customer-centric to being customer-centric organizations— the new organizational DNA. This shift requires:
- recruiting and developing high performers — using performance traits throughout the entire employee career cycle
- transforming from doing analytics to becoming data-driven
- aligning goals from top to bottom with the strategy
- implementing contribution-based budgeting
These factors create a performance-oriented culture that can deliver accountability and role clarity from top to bottom. Moreover, it enables marketers to generate predictable growth for the organization.
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