The Chief Marketing Officer (CMO) is at the forefront of helping the company meet customer needs better than the competition (profitably, that is). In theory, the CMO role should be exalted, but reality is different. Too often, top marketers struggle to influence the big company decisions. New evidence suggests many CMOs are missing the needs of an important customer: their own company. It’s time to change this.
(From my Forbes column).
Here today, gone tomorrow
CMO tenure is short—too short. While S&P 500 CEOs stay for six years plus, the average US CMO tenure is about four years, or forty-eight months. Spencer Stuart, a search firm, reports tenure was even down to forty-four months in 2015. And that’s still better than the eighteen months for UK CMOs, as estimated by the London-based Marketing Society.
Why is CMO tenure so short? One argument is that the digital revolution is prompting CEOs to look for tech-savvy top marketers and to create new roles, such as Chief Digital Officer, thereby reducing the role of the traditional CMO. Another view is that the ever-growing pressure to show measurable results is taking its toll on CMOs who are either unable to quantify the return on marketing investment or are unwilling to shift resources from long-term brand building to short-term campaigns with more measurable results.
But there’s another less palatable truth: many top marketers are out of sync with the rest of the C-Suite.
Why Jobs lost his job
In the 1980s, Steve Jobs, then an Apple employee, was so focused on his pet project, the Macintosh, that he secured a separate building for his team—with a pirate flag. “It’s better to be a pirate than join the navy,” he said. Jobs understood customers better than most people. But even as the company was bleeding cash, he couldn’t have cared less about what his CEO wanted—the CEO who ended up firing him.
Marketers’ relationship with the C-Suite often demonstrates parallels with that of the younger Steve Jobs. London Business School Professor Patrick Barwise and I recently analyzed over 67,000 360-degree assessment responses from direct reports, superiors, and coworkers who rated senior marketers and leaders from other disciplines, such as finance and sales. Just 46 percent of the bosses said their marketers knew where the organization was going and shared this with their teams.
Other researchers have reported similar misalignment. The Economist Intelligence Unit found that 54 percent of company leaders didn’t think their companies’ marketing and business strategies were aligned. At the same time, many senior marketers—a bit like Steve Jobs—felt their bosses didn’t understand the importance of their work.
CMO power lies in the space where customer needs and company needs overlap (the “V-Zone”)
We recently gave 1,232 senior marketers an extensive self-assessment covering their leadership behaviors, their organizational context, and their perceived business impact and career success.
Of these senior marketers, 71 percent believed their business impact was high, but only 44 percent were satisfied with their career paths. Our 360-degree data painted a similar picture. It seems marketing is important—but marketers often aren’t.
What characterized the most successful CMOs in our research? As you would expect, these top marketers had excellent marketing skills. They understood customer needs and knew how to serve them. But they understood and addressed their companies’ top needs too. The top CMOs were well aligned with the C-Suite and knew how to mobilize their nonmarketing colleagues to serve customers better.
Our research confirms that marketing success is about maximizing the overlap between customer needs and company needs. We call this overlap the “Value Creation Zone,” or “V-Zone” for short. Creating that match, however, isn’t what marketers do naturally.
If a CMO only worries about what customers want, they won’t get much attention at the top—and may see the door. If they focus only on what the CEO wants, the company won’t meet customer needs and is likely doomed—with the CMO rightly first in line for the chop.
For success, CMOs must work to expand the V-Zone, creating value for both customers (products and services that meet their needs) and the company (revenue and profit). But how?
Getting into the V-Zone
In our research, we found twelve sets of leadership behaviors (“powers”) that help CMOs expand the V-Zone. Here are four of the most important ones:
Focus on the big issues
The issues the marketing team tackles must be big. CMOs need to establish the most important issues for both customers and the company and focus their efforts and their teams’ efforts on those issues.
Walk the halls to mobilize nonmarketing colleagues
Most of those who determine the quality of the customer experience don’t work in marketing but in other departments, like sales, call centers, service, production, and so on. The best CMOs spend much of their time outside the marketing silo, walking the halls and engaging these nonmarketing colleagues to help them improve the quality of the customer experience.
Get the skills mix right
The CMO needs to build and develop a marketing team with the right mix of creative, analytical, and leadership skills to address the specific big issues identified in the V-Zone. Too often, they work with a legacy-skills mix instead of adjusting the mix to fit the task.
Know your stuff
Most CMOs excel at understanding customers and the market—a key driver of business impact. Yet a surprising number then fall short of detailed product knowledge (partly a knock-on effect of low CMO tenure). However, our data showed that marketers’ understanding of products is a big driver of career success (and hence tenure). To climb the ladder, the CMO must speak the company’s product language fluently.
CMO success is about maximizing the V-Zone—the space where customer and company needs overlap. The prize: more business impact, career success, and—quite simply—more fun in being a CMO!