Recently, I read the following article, “Marketing’s moment is now: The C-Suite partnership to deliver on growth”, in the McKinsey & Company blog.
McKinsey’s analysis reveals that a marketing organization’s ability to drive growth depends heavily on the strength of the partnerships the Chief Marketing Officer (CMO) can forge with the C-Suite executives and the support of the CEO to further marketing’s growth agenda.
The report identifies three archetypes of CMOs based on how they interact with their peers and with the CEOs, and their duties in the company:
- Unifiers, those who can forge strong partnerships with the CEOs and key players in
C-Suite
- Loners, those who have a limited relationship with C-Suite and CEOs and are limited to marketing communication functions
- Friends, those who have a good relationship with CEOs and C-Suite and have a limited contribution to the company’s growth
The survey concludes that high-growth companies are seven times more likely to have a Unifier CMO. But, according to the report, only 24% of CMOs are key to the company’s growth.
What have Unifier CMOs done better than Friends or Loners CMOs?
- They got the support of the CEOs and they are aligned on the CMO success. CEOs are the first brand-advocates and are committed with long-term investment in marketing.
- Unifier CMOs have a seat at the C-Suite level and a key role in helping drive the company´s strategy and customer experience management.
Not surprisingly, these conclusions are supported by similar surveys.
A recent report from Korn Ferry, based on a survey of 220 CMOs and marketing leaders, found that only 48% of CMOs are able to effectively tie their marketing organization’s results to company performance.
The majority are either only somewhat (38%) able to do so or do so poorly (11%) or not at all (3%).
Other report made by Deloitte and the CMO Council found that only one-third of CMOs feel confident about their impact on growth on the basis of gross margin and on market share.
In a nutshell, most CMOs are not driving Growth.
Is your Business looking at Marketing the right way?
Most of CEOs do not consider marketing a strategic move of the management team. Normally, when they hear the word marketing the first thing that comes to their mind is “Can we afford it?”, “How do we know this money is coming back?”
CEOs need to change their mind, empower CMOs and create the right organizational and cultural condition to thrive.
If the CEO doesn’t understand the connection between marketing and revenue generation, it may be the fault of CMOs.
How can marketers change the CEO’s mind, empower the marketing department and create the right organizational and cultural condition to thrive?
They must start by making sure the CEO understands how exactly marketing is driving growth. They must speak the CEO’s language and demonstrate that marketing drives predictable and significant value: revenue, acquisition, retention, customer lifetime value, and ROI.
It means that they must translate metrics into genuine business value. CMOs need to negotiate up front with their CEO, align the marketing plan with the expectations of the CEO and get their support to help drive growth.
It seems logical and easy to do, but the reality is completely different.
Korn Ferry´s survey asked CMOs which marketing function is in the greatest need of advancement. Leading the way as the area in the greatest need of progress is Analytics, cited by 39% of respondents.
CMOs have been increasing their use of analytics in recent months, although organizational use of analytics remains immature.
Marketing needs to tie results to company performance. Therefore, the sooner they tackle the need for measuring their activities, building a solid foundation of data, testing options, setting key metrics and translating them into the CEO’s language, the better.
CMOs and the C-Suite must play together
CMOs need to convince other C- Suite executives that they are working together for the success of the company. Marketers need to build strong and mutually beneficial relationships and make C-Suite executives feel part of the process.
Marketing is too complicated without full alignment of:
- Product Managers
- Sales Managers
- Customer service managers
- Human resource manager
- IT manager
- Financial Managers
CMOs seem quite clear that their effectiveness depends more on organizational alignment than on resources.
Korn Ferry’s survey asked marketers which of 5 areas would most help them to be more effective at their job, and 43% pointed to organizational alignment.
That was more than twice the share that cited any other factor, including greater resources (19%), increased budget (17%) or a different CEO (16%).
Therefore, they need to adopt the language and mindset of other C-Suite execs and explain how marketing can help meet their needs. The CMO’s rapport with the C-suite is crucial in establishing marketing’s role as a growth driver.
But the reality is quite different.
According to the Deloitte and the CMO Council report we notice that organizational alignment seems to be fairly “tight”, as almost one-third (31%) of respondents said that organizational allies are totally aligned and in full support of their growth strategies and goals.
Another 40% said that their organizational allies are supportive and quick to offer advice and recommendations even though they’re not actively involved in the marketing plan.
That leaves fewer than one-third of marketers reporting that organizational allies are either focused on their own agendas (26%) or failing at execution despite strategic alignment (3%).
Well, my dear readers, this is it for now.
In this article, I tried to explain why the CMOs are not driving growth. Some of the main reasons are the lack of alignment with the CEOs, the inability to forge key partnerships with other C- executives and the stereotyping of marketing as a communication role.
Have you got any different opinion? Please, share it with us.
In the next article, I will suggest how to achieve the CMO and CEO alignment.
Do you want to know more about this topic? Check the following articles:
What Can We Learn From the Fall of Leading Tech Brands?
How to Hire a Great Chief Marketing Officer
What winning approach should brands undertake in order to succeed in Asian markets?
Find below the reports mentioned in the article:
POST WRITTEN BY
Chema Lopez
A Madrid Polytechnic University International MBA has worked as global marketing director in B2B and B2C international leading companies implementing global marketing and communication strategies to ensure business objectives and to optimize brands reputation and visibility on a global level.
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