A new study shows that the CMO role is now becoming an essential function in companies, but there is still a long way to go to achieve influence and control. Spurring CMOs on to take charge!
At senior executive level in many firms, CMOs still have to prove themselves. This is why “The evolved CMO” is also the apt title of a new study on CMOs. In Summer 2011, the executive search firm, Heidrick & Struggles, together with the market research firm, Forrester Research, surveyed decision-makers in 191 firms on the role of the CMO. The study published in 2012 shows a clear development in the role of CMOs today when compared with a similar study in 2008. CMOs now have greater management responsibility, play a stronger role as the voice of the customer within the organization and have generally moved away from the periphery into the centre of companies, and this has been a success, which bodes well for the future.
Nevertheless, CMOs are still rarely responsible for the main factors in the success of a business. When asked which central functions in the company fall within the scope of marketing’s responsibility, the focus is on areas such as brand strategy, advertising or market research. However, only a small number of marketing organizations are responsible for key success drivers, such as loyalty programs (55%), prices (31%) or product development (30%). Also responsibility for brand P&L (49%) or strategy development (40%) tends to be limited. Of the “4 Ps” (product, price, place, proposition), only one “P”, proposition, is in the hands of marketing. Collaboration between marketing and sales remains a constant issue. “Average” is the term, which best sums up the data gathered in the survey – there is plenty of room for improvement in this respect.
CMOs want their influence to grow in business strategy and digital marketing. 79% of CMOs surveyed state that their goal was to have more influence on the future development of the corporate strategy. This was by far the most important goal in the survey. 89% also consistently stated that their strategic thinking and visioning will play a major role in their personal success. This is, however, where the study also reveals the first inconsistencies. Only 22% said that their strategic thinking and visioning was in need of improvement and only 12% believe that they need more business acumen. This is where their own perception may differ from that of many CEOs. Nevertheless, 38% agree that they need to improve their relationship with the rest of the senior executive team.
There is also a slight difference in perception concerning digital marketing: 40% state that they want to improve their technological know-how. This is an understandable number in a world where marketing is changing. However, only 18% list technological know-how in their “Top 5 Factors” for personal success. In this respect, CMOs also have to ask themselves how much serious consideration they give to the digital revolution in marketing.
The consultants from Heidrick & Struggles and Forrester Research consequently make the following recommendations for action in their analysis:
- Beef up your own technical understanding
- Partner with lead peers on the senior executive team. If CMOs want to represent the voice of customers effectively they have to work closely with decision-makers. In a digital world, CMOs also have to develop much closer relationships with chief technology officers (CTOs).
- Stronger focus on retaining instead of acquiring new customers. According to the study, the majority of CMOs focus on new customers. Based on other studies, Forrester recommends reconsidering this strategy to develop a customer-life cycle approach with a greater focus on existing customers.
- Stronger relationship with sales to ensure the same brand experience is provided to customers. As the two growth-focused departments, sales and marketing must develop visions, targets and execution plans together to make the firm thrive.
In a nutshell: stronger leadership skills and greater technological know-how. CMOs must now get to grips with these two (no longer quite so) unfamiliar challenges!
Source: The Evolved CMO, 2012. A Joint Research Project by Forrester Research and Heidrick & Struggles.