What a Super Bowl night! In the end, it was a hard-fought victory for the Eagles. Off the field, another battle raged on between Budweiser, Coke, Kia, Pepsi, Squarespace, P&G, and many others: the nation’s top brands fought for customers’ attention. But after the dust settles, many CEOs, CFOs and shareholders will ask: Was it worth it? Can I trust my marketers? This year, again, they’re short of good answers (from my Forbes column).
Start with why
The Super Bowl. Very few events generate more marketing buzz before, during, and after the show. Agencies and marketers alike use every opportunity to rave about their work. At a time when C-suite trust in marketers isn’t always high, I wanted to know how well CMOs communicate the business goals for their Super Bowl ads. To find out, I studied the official press releases and CMO statements of over a dozen major brands. I created three simple columns to tally which element(s) the brand owners were talking about. The columns were labeled as follows:
1. The ad’s creativity (of interest to the general public)
2. Ad creation details (of interest to the agency world)
3. Business goals (of interest to the CEO and shareholders)
As expected, the creative and creation columns filled quickly. This is obviously the cool stuff that CMOs love to talk about—and rightly so. Creativity matters.
I soon realized that I didn’t actually need that third column. For this year’s Super Bowl ads, business goals were thin on the ground. Although a few brands highlighted specific marketing objectives—including Febreze(you do need this type of product), Tide(a new scent and a new stain-focused cleaning line), Wendy’s(only fresh beef in all burgers), and Sprint(cheaper than Verizon)—most didn’t bother talking about business outcomes at all.
To be fair, most CMOs may have detailed long and short-term business goals tucked away inside their desk drawers. But considering these were public statements about the nation’s most high-profile campaigns, what I found seemed pretty light.
Just as a reminder, we aren’t talking about Adweek. These were official press releases, typically located in the company’s online investor relations section. They appear next to earnings statements and annual reports. They get read by investors, analysists, and, for sure, the CEO. Are marketers sending the right messages to build trust with this important audience?
The big issue: C-suite trust in marketing
The CMO brand has recently been under fire. Coke, Colgate-Palmolive, Coty, Mondelēz, and Tyson Foods have now installed chief growth officers. Seriously? What is a CMO’s focus if not profitable growth? Peter Drucker would turn in his grave. And let’s not forget: CMOs still get fired more than any other C-suite member. In many firms, “CMO” seems to stand for “Chief Most Out”.
The sobering truth is that CEO trust in marketers is low—and many CMOs aren’t seen as drivers of profitable growth. Researcher Whitler’s recent HBR article cites a study that found that 80% of CEOs don’t trust or are unimpressed with their CMOs. And our own large-scale global CMO study found that 33% of all top marketers don’t focus too firmly on marketing returns. These numbers are astonishing.
Long-term brand building matters! The Bud frogs, the Geico gecko, Coke’s “It’s the real thing”: iconic campaigns like these still pay back today in terms of brand preference and revenue. You can’t put a price on that. But that’s exactly the problem. Much of CMOs’ work deals with the future. But the future can be hard to prove. Marketing professor Patrick Barwise paints a picture of the issue. What customers experience impacts the short-term revenue and profit. But almost every campaign impacts the brand’s long-term equity, too—and subsequently long-term sales and profits. However, measuring these long-term effects isn’t easy.
CEOs, CFOs, and shareholders understand the marketing measurement issue. But since digital makes short-term impacts more measurable than ever, the expectations are higher for CMOs to prove the long-term influence too (or spend less on it).
Yet, even under toughest circumstances, some CMOs manage to build high C-suite credibility. Patrick Barwise’s and my recent CMO researchhas revealed that building this credibility requires strong leadership skills. The most respected CMOs install proper measurement systems, align marketing activities and company goals, and communicate with the C-suite—openly and free of buzzwords.
You sell or else
The purpose of advertising is to sell—ideally at a profit. Although this concept sounds obvious to the CEO, CFO, and shareholders, it has become uncool in the marketing community to just sell. The new big word is purpose. (Selling is a purpose too, but that’s not what people mean.)
Pressured by the need to become more purposeful in their output, CMOs have increasingly tried (and often failed) to gear their ads toward a greater good. Some of this year’s Super Bowl ad descriptions read like pressure group mission statements, highlighting cultural moments, inclusion, bridges between generations, and so on.
Don’t get me wrong. I believe brand purpose matters—and companies could do a much better job as global citizens (including paying their fair share of taxes). But when it comes to spending millions of dollars for 30 seconds of airtime, marketers better make damn sure they are getting some bang for their buck.
A report of consultancy Communicus last year found 80% of all Super Bowl ads fail to change consumer opinions and intentions regarding a brand, and only 10% of consumers remember having seen a given ad in the first place. Whether or not there’s a purpose involved, great ads still require a relevant message and an arresting creative execution to hammer the message home. This is called craft, and it’s key.
The reality is: Only thriving brands will have the power to affect significant social change. At the end of the day, thriving means getting more of these fizzy drinks, room fresheners, and trucks into the consumers’ hands. David Ogilvy’s words still stand: We sell, or else.
PS: Tide appears to have won this year’s Super Bowl commercial battle by using the full spectrum of best practices: a relevant message, an arresting creative execution, event-dominance, and a sales-relevant product purpose: fewer stains.
Next year, the Patriots will be back with a fresh attempt to win the game. What if CMOs, too, would change the game in 2019? What if they leverage the high-profile Super Bowl event to communicate amazing creative work paired with clear business goals. What if they were to prove to stakeholders that marketing works? Through a strong focus on the marketing craft—and the leadership to keep the eyes firmly on the revenue line. It would be a battle worth fighting.
You are a finance leader. You love numbers. You know what’s going on inside the company’s P&L. In a complex world, your CEO relies on you. Hand over heart: What do you think of marketers? Many CFOs think that marketers talk bollocks, don’t understand the company, and simply can’t be trusted. To be fair, they sometimes have a point. But most of their perceptions are wrong—there’s more common ground than they may think. In fact, marketing most likely determines the fortunes of your company. Let’s talk (from my Forbes column).
Profitable growth is crucial for your company–I think you’ll agree. Making it happen requires serving customer needs profitably better than your competitors do. Even critics admit it: Marketing matters. But why are marketers so difficult to work with? Three forces are at work, and you can help counter all of them:
It’s true, marketers are different. In a recent global study, among over 8,600 executives, which I conducted together with London Business School’s Patrick Barwise when compared with other leaders, marketers came out as more open, creative, and innovative. They care about connections and can often “feel” what’s going on inside your customers. Marketers can be “okay” when things don’t add up to 100%, They are often ready to accommodate new ideas, even if another plan was already agreed upon at first.
Marketers often remind me of Eros, the Greek god. The youngest of the Olympian Greek gods, Eros had one irresistible skill: with one arrow he could make you love anyone he wished. The other gods usually tried – not always successfully – to be rational Logos leaders. They saw Eros as wild and unpredictable. So, despite his unique skills, they never considered him sufficiently responsible to play a full part in the ruling Olympian family. In many ways, marketers are the emotional Eros leaders in a rational Logos world.
Logos needs Eros. How come people can usually remember the lyrics of a song easily, but forget most Power Point slides? Creative work can be powerful. Your company desperately needs people who think outside of the box, passionately love customers, and innovate freely. There’s now clear evidence that a strong marketing department improves a company’s financial performance.
Don’t expect marketers to think and talk like you do. If anything, you should be worried if they did. Instead of fighting about their differences, finance professionals and marketers must say, “Let’s trust each other more, so that as a team we can be bigger than the sum of our parts.”
Agree On What Can Be Proven
Here’s one of the biggest success-barriers—even for the best marketers (I write about the other barriers here). The marketing job is all about the future. Future revenues, future profit, future products and services, future consumer behavior, and so on. Unfortunately, the future is notoriously hard to predict. As a result, next to you, a marketer will always seem a little less trustworthy. In internal meetings, then, a focus on the future can be a real disadvantage for marketers.
When it comes to securing future revenue sources, as a finance professional, you carry a large responsibility on your shoulders. If you demand full proof for all marketing ideas, your company will end up replicating the past. Innovation will dry up, and, in most businesses, you’ll become your competitors’ most loved leader.
So keep this in mind the next time you ruthlessly challenge a marketing plan. Your ideas may help—but don’t expect your marketers to prove the future. They (and you) simply can’t. Remember, you and marketers share the same agenda: You both want more customers to buy more products from you more often. That’s something you can trust.
Some of you might now say, “I would trust marketers more if they’d prove at least their past returns.” Point taken. ROI measurement may not be the marketer’s biggest passion. But most have heard the message. Nowadays, there’s more ROI measurement than ever before, and many marketing departments work hard to prove their worth.
But let’s be honest. When it comes to longer-term market effects, the’s a fine line between ROI and rubbish. And spending three days on measuring the returns of a $2,000 campaign may simply be bad business. Many CMOs feel trapped since in a digital world, everybody expects them to measure everything, even if it’s not sensible or possible. As a result, they still do some “hiding.”
Your company needs every finance professional to play an active role in cracking ROI measurement. Try this:
- Help agree on what should be measured. Seek an open dialogue with your senior marketer about ROI measurement. Without prejudices, help assess which marketing measurement makes the most sense and how accurate it should be. Use your analytic experience and common sense to shape the measurement strategy together with your marketer, as a team.
- Get involved in developing ROI measurement. Although the market is swamped with ROI measurement tools (and people who sell them), there’s still a lot to learn. Get involved in testing and developing new ROI tools jointly with your marketing colleagues. In the end, you’ll both win.
Here’s a dirty little secret: Because return measurement is tough and the pressure of proof is high, your marketer may be too embarrassed to take the first step. Go first. Offer to help fix the measurement challenge.
Here’s the real downside to marketers’ openness and creativity: Marketing language has gone haywire. Many CFOs would find it easier to learn Klingon than marketing speak. When your marketer talks about “more awareness” (potentially more revenue), “greater customer experience” (really more revenue), “advocacy“ (even more revenue), millennials” (younger customers), or “Pokemon Go” (don’t bother remembering), you may shake your internal head. The thing is, most marketing terms mean business—it’s just often hard to see at first. Of course, marketers’ use of buzzwords is simply poor internal marketing. It’s getting better, though, and you can play an important part in uniting the nations of finance and marketing:
- Demand debuzzing! Next time your marketing colleague uses a seemingly funky term, instead of just rolling your eyes, ask what this means for the business. Tabling the language issue will help marketers connect better with other employees like you inside the company.
- Help translate. You are often the middleman between the CEO and the CMO. As a finance leader, you can bridge the gaps—to the benefit of the company. We won’t expect you to train the CEO in marketing. But you can help your marketers—in a collegial way—to find language that scores well at the very top.
For success, your company needs marketing and finance professionals to work together as a tightly knit team. Marketers are a bit different, yes. But like you, they work hard to help the company grow as profitable as possible. Marketers do deserve your trust.
PS: In a future article, I’ll explore why marketers should trust you, the finance professional, more. I’d love to hear your thoughts.
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!
Even decades after leadership thinker Peter Drucker said his famous sentence “the business enterprise has two–and only two–basic functions: marketing and innovation” there’s still a—surprisingly lively—debate as to whether marketing’s (and marketers’) role should be exalted. Here are five research-backed facts that prove all marketing skeptics wrong. Marketing and CMOs are crucial for company success! Full stop (from my Forbes column).
Fact 1: Strong marketing departments have a clear positive effect on firm performance.
A new breakthrough study of 612 publicly traded U.S. firms over 16 years, across 60 industries, published in the Journal of Marketing, reported an important discovery: powerful marketing departments have a clear positive impact on long-term stock returns and short-term return on assets (ROA). Researchers Feng et al proved: firms that gave marketers a prominent role execute stronger marketing and make overall better strategic market decisions.
In short: A strong marketing function drives business performance.
Fact 2: Firms with a Chief Marketing Officer perform better financially.
A second breakthrough study proves that companies with a CMO in the top management team, compared to firms without a CMO, achieve on average 15% better financial performance (measured by Tobin-q). Using data from 155 publicly traded U.S. firms over a 12 year period, the findings of German et al make a strong case for the positive financial impact of having a CMO.
In short: CMOs drive financial performance.
Fact 3: CEOs recognise CMOs as the number one shapers of forward-looking company strategy.
With Patrick Barwise and I, supported by INSEAD’s Global Leadership Centre, recently analysed 67,278 360-degree surveys to understand how bosses rate senior marketers versus how they rate all their other direct reports. CEOs rank senior marketers first compared to all other leaders when it comes to challenging the status quo, trying to change people’s opinions about the right course of action, and actively shaping company strategy.
In short: Marketers drive forward-looking firm strategy.
Fact 4: Marketing’s power is rising.
In the digital age, other C-suite leaders are becoming more and more involved in marketing, from the Chief Technical Officer to the Chief Operating Officer. You may have heard talk recently about the possible decline of marketing’s influence. Not true. Feng et al (see above) could prove that over a period of 16 years, the power of marketing departments in US firms has steadily increased.
In short: The trend is marketing’s friend.
Fact 5: Marketers can influence much of their own success.
Many marketers work in complex structures and often lack decision power over all four marketing Ps: price, product, promotion, and placement. But marketers are more powerful than many think. In a second study we researched the causal effects of marketers’ perceived business impact and career success. In a large sample of 1,232 senior marketers from around the globe, we could prove that leadership behaviors and skills drive over 49% of CMO’s career success and over 63% of their market success. Of course, external factors like budgets, aligned goals, company culture, role clarity, and top management support matter. But marketers can overcome many of these challenges by displaying strong leadership.
In short: Marketers have the power to drive both their firm’s and their own success.
There has never been more evidence for the importance and benefits of strong marketing teams.
Spread the news!
Diversity was back in the news when agency Saatchi & Saatchi recently sacked chairman Kevin Roberts for saying (among other things) that the gender diversity debate in advertising is over. His widely reported remarks have turned into a PR disaster for Saatchi & Saatchi and for Roberts himself. Too many leaders still believe diversity doesn’t matter for company performance—or they can’t improve top team diversity anyway. Publicly firing a chairman won’t change these beliefs. What’s needed are facts that no C-suite leader can ignore. Let’s make the case (from my Forbes column).
For the record, I’m not a diversity expert or activist. I help leaders make change happen. But through my research I’ve discovered important facts that made numerous C-suite leaders listen.
Let’s put on the CEO hat for a minute. Most CEOs operate in cutthroat markets under huge financial pressures. It’s safe to assume these leaders spend their precious time on topics they deem most critical for the organization’s success. When diversity isn’t on the list, these C-suite leaders must have concluded that
1. Top team diversity doesn’t matter (enough) to the company’s performance or
2. Top team diversity does matter, but it doesn’t require senior leadership involvement
To make real progress on the diversity front, we have to prove these two premises wrong. Let’s look at them one by one.
Premise No. 1: Top team diversity doesn’t matter (enough) to the company’s performance.
Before showing some key data, let me share a personal experience. As a young male marketer, I was once asked to lead my company’s tampon brand. Puzzled at first, I quickly immersed myself into feminine hygiene research and did what I could to satisfy customers and my company. But to be frank, I wasn’t too effective. When a female colleague finally took over, she launched a breakthrough marketing campaign in her first six months based on an idea she had as a teenager. Asking a male to lead a female-focused brand was, at best, bad business judgment. Yet, it’s reflective of marketing’s wider diversity issue.
Best Buy pulled out of China, Walmart failed in Germany, and Dell’s pastel colored “Della” laptops for women went nowhere. The most cited common cause: poor customer understanding. However, most companies still believe the best people to crack all market challenges are white, straight, local male (WSLM) marketing leaders.
So how important is top team diversity for company success? As part of a major diversity initiative at McKinsey & Company, I once led a team that analyzed the effect of board diversity on company performance across several sectors and four major geographies. What we found was staggering: for companies ranking in the top quartile of executive-board diversity (we looked at age, gender, and nationality), return on equity (ROE) was 53% higher, on average, than the ROE for those in the bottom quartile. Simultaneously, EBIT margins at the most diverse companies were 14% higher, on average. In other words, companies with diverse top teams outperformed their peers in every single geography we looked at. Many newer studies, too, have come to similar conclusions.
Premise No. 1 of many CEOs and CMOs is simply wrong: top-team diversity does matter significantly for company performance.
Let’s look at the second premise then.
Premise No. 2: Top team diversity doesn’t require senior leadership involvement.
Not every C-suite leader is convinced diversity needs their involvement. “In our company, the best people will make it,” one CEO told me recently. Many senior leaders share the same sentiment. The argument goes like this: “We hire lots of non-WSLM talent (e.g., people of different gender, sexual orientation, ethnicity, or nationality). But we often find that non-WSLMs make different career choices along the way. That’s why we have so few of them in our top team.”
The meritocracy argument sounds plausible. Why push people up the ladder that don’t want it? Why not just hire them and let them succeed?
The reality is that today’s race for the top doesn’t take place on an equal playing field. Too many women have experienced sexual harassment. People of color talk about small daily discriminations—none of them big enough to call HR, but each of them enough reason to feel less valued. Many LGBT managers still hide their sexual identities at work, fearing the resulting disadvantages and jokes at their expense. All of this is happening as you read this article.
In my latest global marketing leadership research, 36% of career success was explained by what I call “self-mobilization” (Patrick Barwise and I write about it in the upcoming book, The 12 Powers of a Marketing Leader). Success as a leader isn’t just about hard work. It’s also about passion, about going the extra mile, and about the ability to inspire others. But the issues too many non-WSLM leaders still struggle with take energy away from what they really want to do: give their best.
But how can senior leaders increase top team diversity? For our McKinsey study, we closely examined the actions and strategies of the best performing companies. Besides diversity in recruiting, these companies, together with non-WSLM leaders, had developed tailored programs to tackle diversity barriers. Examples include tough enforcement of ethical behavior, mentorships, buddy programs, and awareness training. Most importantly, the company’s senior leaders gave diverse talent the most important thing: opportunities.
The case for senior leadership intervention isn’t about special treatment. It’s about creating an equal playing field. Reality proves that, without intervention from the top, diversity simply won’t happen any time soon.
The evidence demonstrates that premise No. 2 of many CEOs and CMOs wrong, too: top team diversity does require senior leadership involvement.
To return to the Saatchi & Saatchi case: Kevin Roberts’ interview remarks, in all fairness, were more nuanced. He hinted at the importance of the 65% of female staff at Saatchi, and he showed frustration that the company “can’t figure out” how to make more female employees successful.
But he—like many executives—gets two essential premises wrong by thinking: 1) Top team diversity doesn’t matter (enough) to the company’s performance, and 2) Top team diversity doesn’t require senior leadership involvement. These widespread beliefs are the real reason for the diversity problem we’re facing.
Top team diversity (especially in marketing) isn’t just “nice to have” company goal. It’s a fundamental driver of business performance, which senior leaders can actively influence.
The evidence is clear. It’s time to spread the word in the C-suite!
Until recently, top CMOs were a rare sight at the Cannes Lions International Festival of Creativity. That’s changing. This year’s festival brought the “who’s who” of marketing leadership to Cannes in a quest to celebrate creative excellence. I had the opportunity to talk with a number of leading CMOs and to follow the key debates—with a particular focus on what Cannes means for leaders (from my Forbes column).
The upshot? There’s lots of encouraging news coming out of Cannes. While marketing still faces tactical challenges—social media, big data, ROI, to name just a few—the prevailing belief is that CMOs are back in the driver’s seat. They’re cutting through the clutter and refocusing their attention on what really matters: great work that drives the business.
From a leadership perspective, five takeaways stood out:
1. Cut through the clutter and refocus on effective creativity
CMOs have a love/hate relationship with Cannes. Since it’s often perceived as a self-congratulating event for agency execs, coming to Cannes wasn’t thought to be helpful for CMOs trying to build their brands as serious business leaders. But there’s a growing realization that—despite all science—outstanding creativity still sits at the heart of marketing success. “We have to change the way we engage with consumers to actually produce stuff they want to see,” quipped PepsiCo’s Beverage Group President Brad Jakeman. Past CMOs’ focus on the ever-growing armory of new tools and channels has left creative quality trailing. Customers are now voting with their feet. “Ad blocking is something that we’ve all created,” Jakeman said. The CMOs who came to Cannes this year sent the strong message that marketers have to once again raise the creative bar. According to P&G’s Marc Pritchard, “we’ve got to cut the crap and elevate the craft.” Criticizing the clutter that marketers are creating, Pritchard argued that “just because you can doesn’t mean you should.” Data, both big and small, are helping: for a long time now, data and creativity have been seen as opposing ends of the marketing spectrum. That’s radically changing. Instead of hampering creativity, data-driven insights are now at the heart of the most effective creative work. At a private event, one CEO and former top marketer put it nicely: “CMOs need the guts again to stand up for creative excellence.”
2. Actualize the power of data
“Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” Almost a century after merchant John Wanamaker’s memorable quote, marketers are still grappling with understanding marketing ROI. As someone coming from operations, AT&T’s CMO Lori Lee noted that she was “shocked at how behind marketing measurement is.” But that’s not the half of it. Asked about big data, CMOs roundly observed that marketers have gotten bogged down in too much complexity. With more customer data available, they are struggling—more, not less—to generate powerful customer insights. Reflecting many CMOs’ sentiments, MasterCard’s Raja Rajamannar pointed to the massive challenge of marketing skills. There are many people who know the classic marketing craft, but struggle with contemporary marketing—and vice versa. Building marketers with both skills remains high on the agenda. At the other end of the data spectrum, many agencies are still refusing to leverage customer data. “Crap data would probably not be the thing I’m most worried about—it’s no data that I’m worried about,” says Pritchard. CMOs are now raising the stakes on data insights, both inside their organizations and with external partners. The year 2016 could very well see a shift from complaining about data complexity to pushing harder, innovating measurements, and simply demanding more data insights. Today’s data leadership challenge for marketers isn’t perfection—it’s tangible progress.
3. Take more (measured) risks
“Don’t be afraid of risk!” Richard Branson’s recent advice to marketers sounds good on paper, but is pretty hard to put into practice for a Fortune 500 marketer, surrounded as she is by compliance departments and legal teams. In a session hosted by Mondelēz’s Dana Anderson, Wharton Professor Adam Grant noted that managers are encouraged to avoid failure rather than to take risks. Many CMOs agree that their bosses don’t tolerate marketing failures well. As a result, most brands are playing it safe—often missing huge market opportunities. “As the CMOs, we don’t take enough risks. We don’t want to have the tough conversations with our bosses,” observed Jorn Socquet, VP of marketing for Anheuser-Busch. He argued that marketers would rather protect their jobs than push the envelope. But “taking no risk is a risk itself” said Merk CMO Atilla Cansun. CMOs can’t realistically expect more risk-taking license from their bosses—so it’s up to every CMO to take (measured) risks, even if this puts his or her own job on the line. Why? Because taking risks is what senior leaders get paid to do.
4. Step up marketers’ role as uniters inside the company
Many marketers work in complex organizations. To make even a small customer experience improvement, it’s not uncommon for a CMO to have to align with up to 20 peers and superiors—many of whom have their own agendas. Ann Mukherjee, SC Johnson’s Global CMO, recounted how hard it can be to navigate that matrix. The best approach, she believes, is inspiration: “It’s about motivating people and giving them hope.” (From my experience working with leading CMOs, I couldn’t agree more.) The other common challenge is legacy thinking. Pepsico’s Jakeman cited the example of obviously outdated brand tracking and ROI measurement tools, and the strong organizational tide to continue in the same old way. To avoid path dependency and effect change, marketers need to step up and demonstrate how marketing is actually driving the business. Mastercard’s Rajamannar argued that marketing KPIs won’t do the job: CMOs build credibility by proving the connection between marketing and real business results. Marketers need to integrate how the company serves customers end to end. Mukherjee: “We are in the business of monetizing human behavior. We have to orchestrate the organization around that mission. Period.”
5. Reshape the agency-client relationship
While customer behavior has radically changed, most marketing agency models haven’t. That’s the chilling conclusion from several Cannes panels. Up until a few years ago, Pepsico’s Jakeman argued, a brand had perhaps five major content pieces per year, six months to create them, and a US$2 million budget. Today it’s 50,000 content pieces, each with a $20,000 budget, and six hours to roll them out. That’s why Pepsico now deploys in-house teams to serve its rapidly growing content needs. Why? Because the entire agency model isn’t geared to the new creativity cycle. CMOs have long been looking to their agencies to come up with a new framework for a faster-moving, data-driven marketing world—with limited success. The consensus at Cannes was that CMOs need to take the lead in developing these future-proof agency-client models. Doing so won’t just solve a burning marketing issue: it’s also an opportunity for CMOs to shape their own professional landscape. That in itself should motivate top marketers to step up and lead the industry’s transformation.
From a leadership perspective, Cannes 2016 felt like a turning point. In previous years, tactical marketing issues and buzzwords (e.g. “millennials”) dominated the debate. This year’s CMOs took more of a strategic industry perspective, and paired it with a renewed focus on what really matters: great analytic and creative work that actually drives the business.