Discover more from Hot Takes
A wake-up call for companies and the CMO role
Marketing is the most important role in this new higher interest, hyper-competitive world. Most of the business community is still fumbling the ball.
Note from Adam: the following is an opinion piece written by my colleague and VP of Growth at AdQuick, Chris Gadek, but also expresses my thoughts on the state of the CMO quite well. I think you’ll enjoy this one especially if you’ve been paying attention to what’s going on in our industry over the last few years. Our sector mostly feels not ready to have this conversation yet, but it’s time.
We’re all familiar with the noxious concept of shrinkflation. Products get smaller or worse, but the price remains the same. I fear a similar phenomenon is taking place within the office of the Chief Marketing Officer (CMO).
Don’t get me wrong. The right CMO is a force multiplier, helping crystallize an organization’s message and precision-delivering it to the target audience. They win hearts and minds. They create trends, move markets and build revenue. With the power of branding and analytics, they can paint a human face (and thus the values typically ascribed to people, like creativity, imagination, or reliability) on a corporation.
CMOs are great. Or, at least, they were.
The Rapidly Shrinking CMO
This is where the shrinkflation bit comes in. In recent years, the unspoken understanding of a CMO has changed. They were — and still are — a vital cog in the C-suite machinery, but now many of them are transient. According to research from Spencer Stuart, the average CMO tenure stands at just 40 months. This figure is the lowest for a decade, and is less than half the average tenure of a CEO, at 85 months.
It gets worse. While the demands upon CMOs have only increased in recent years, particularly with the emergence of new marketing channels, their confidence is at rock bottom, with less than half able to communicate the value of marketing within the business. This is, as Gartner’s Chris Ross pointed out, an abject failure of storytelling.
To add insult to injury, we’ve seen an overall lack of… competence, perhaps? Finesse? Admittedly, this point isn’t as quantifiable as the other two. Still, it’s hard to ignore major industry foul-ups (like the credulous embrace of the Metaverse and the disastrously executed, though undeniably well-intentioned, Bud Light debacle) and wonder whether they’re the product of a CMO class that’s lacking confidence and commitment.
Perhaps the most frustrating thing is that it doesn’t need to be this way. The annals of corporate history are filled with examples of visionary CMOs — or, as with the case of Burger King’s Fernando Machado and Apple’s Phil Schiller, CMOs by another name — that understood their businesses and their customers, and how to resonate with them. And there are incredible CMOs working today, although their examples are shrouded by countless stories of high-profile failures and mismanagement.
It’s entirely possible to revert back to the right track. I don’t, as Bank of America and Johnson & Johnson believe, the role of CMO is obsolete, or best subsumed by other job titles. But I am fervently convinced that it’s in desperate need of reform.
Diagnosing The Modern CMO
The problems that besiege the office of the CMO are, in fact, deeply intertwined. CMOs enter an organization that they perhaps don’t fully understand, and before they have the chance to find their footing, are tasked with meeting ambitious deadlines or targets. They are, in essence, set up to fail. And so, after a couple of years, they leave, only for the cycle to restart.
As Caren Fleit from analyst house Korn Ferry put it: “Short CMO tenure is a reflection of a lack of understanding of how powerful this role can really be in terms of driving business outcomes. This often leads to lack of clarity around tangible deliverables and also to hiring a CMO whose skills and experiences may not be aligned with business needs.”
It’s important to understand the psychological effect of this cycle.
First, it institutionalized among CMOs an expectation that any job is, by definition, transient. That leaving after a couple of years isn’t just inevitable — but rather the right thing to do. But also, it undermines the perceived value of a CMO. According to a 2022 study from Boathouse, a marketing and communications agency, only 34 percent of CEOs have “great confidence” in their CMOs, and only 32 percent trust them.
Those are some damning figures. And with these low expectations, CMOs are incentivized to make decisions they believe will have the most impact in the shortest amount of time — rather than take a longer, more strategic view. This, in turn, fundamentally alters the CMO’s appetite for risk. When you prioritize immediacy and impact above all else, you inevitably find yourself making choices that are inherently speculative in nature.
This phenomenon likely explains the credulous embrace of the metaverse — a doomed concept from Day One — by some of the world’s largest and most prestigious brands. Organizations that, in happier times, would have known better.
This is a recipe for disaster. As Sparrow Advisors so aptly put it, the CMO is “a strategic role that’s been shoehorned into a tactical timeline.” Nobody can deliver results under these conditions.
Looking For A Solution
Here’s the thing: the fundamental responsibilities of a CMO have changed.
The past two decades saw an explosion of technological advancement, with new channels emerging, the growing dominance of digital, and a shift from the subjective (the messaging we think will work) to the objective (what the data tells us).
And so, CMOs have to change too. It’s not merely enough to have “vision.” CMOs must also be technologists.
In fairness, most CMOs are cognizant of this fact. According to a recent LinkedIn survey of CMOs, the most important skill in the coming two years will be a mastery of marketing technology and data analytics. Today, it’s the second-most important skill, trailing behind “creative strategy and execution” by a large margin.
They’re right. Data is perhaps the most vital asset in the CMO’s toolbox. It’s the secret sauce that elevates a brand’s messaging by inferring the wants and attitudes of the customer, and how to deliver them. But more than that, data is how the CMO can prove their value to the rest of the business and other C-suite leaders, not merely by delivering results, but also by obtaining insights that can inform product development and execution.
Data can help restore trust in the office of the CMO. But it’s also the first step in returning the job into one that’s rooted in strategic thinking, rather than one that relies on ad-hoc “tactical” decisions designed to deliver results in the shortest possible time frame.
If anything is clear, it’s that so many of the bad decisions we’ve witnessed in recent years were borne about by short-termism, or an otherwise shallow understanding of an increasingly complex world. This complexity is evident when looking at a LUMAscape — a series of “maps” detailing the digital marketing and adtech world created by Luma Partners — which now lists over 10,000 companies across dozens of niches and categories.
The only way to make sense of this complexity is by combining data with a sober-headed and strategic understanding of how each vendor or channel aligns with the needs of the organization. Most CMOs, ultimately, don’t know what they need. When working to short timelines and under inordinate amounts of pressure, it’s hard for them to figure it out.
The Reborn CMO
You don’t have to look far to find articles and thinkpieces decrying the CMO as an obsolete relic of a bygone era, or a frivolous bauble that doesn’t quite make sense in an increasingly complex digital world. This article, as I’m sure you’ve gathered by now, isn’t one of them.
That’s because the right CMO can be a powerful asset for an organization. I genuinely believe that. The problem is that CMOs work under conditions and expectations that are utterly incongruous with the results they’re expected to deliver.
And that’s why CMOs fail.
It’s why CMOs — a role that is as reliant on storytelling as the aviation industry is on the internal combustion engine — can’t actually explain what they do, or why it matters, or even how it helps the business. It’s why CMOs are increasingly alienated from the companies they represent, as demonstrated by Microsoft’s CMO Chris Caposella, who, in a moment of unmitigated tone-deafness, told employees that the only way to increase their pay is to raise the stock price.
This statement came after Microsoft froze salary increases for 2023, despite inflation remaining stubbornly high, and Caposella himself had cashed out $4.4m in stock — or roughly 36.6 times the average Microsoft salary.
The only solution is to fix the incentives and conditions that CMOs work under. And that means rebalancing the role to emphasize strategic, long-term, and empirical decisions. To be clear, I’m not discounting the importance of creative work or execution. Rather, I’m simply saying that CMOs need to have a realistic understanding of what works, and under what timeline.
The easiest — and perhaps only — way to accomplish that is through technology. Even with the ongoing changes in the adtech and analytics world, like next year’s planned retirement of third-party tracking cookies, CMOs and organizations have a wealth of data at their fingertips. It’s time they relied upon it more.
Data isn’t just for profiling, targeting, and customizing. It’s a reasonable voice that says “maybe investing millions into a metaverse push isn’t the best idea.” It’s the way CMOs can validate their decisions, both to themselves and to other C-suite roles, and show results. And it’s a reminder that sometimes the best decisions are those that take more than 40 months to execute.
Again, I still think that some of the best CMOs of all time are working right now. And without exception, the most effective CMOs are — and will be — those that see their role as a hybrid that encompasses both the creative and the technological. Those that effortlessly balance the subjective and objective elements of modern marketing, and in doing so, become more confident and respected within their organizations.
As for the rest? Well. I’m sure you’ll read about their next big screw-up on Forbes.
Hot Takes is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.