WARNING: there is some tough love in this blog post.
We all know that CMOs suffer the highest turnover of any executive in the C-suite. Recruiting giant Korn Ferry published the data in the chart below showing that the tenure of the CMO is shorter than any other C-suite executive across nearly every industry sector (with the exception of CIOs in the Industrials sector). The Harvard Business Review covered this topic extensively and proposed some recommendations in a 2017 report called The Trouble with CMOs.
Why is this the case?
The HBR article offers some solid recommendations to remediate this issue, including aligning expectations and finding the right skills match for the role. When you look at the results of the 2019 CMO Survey from the Sirius Decisions unit of Forrester, it is clear that CMOs know the areas that need to improve and have identified them as key focus areas.
The survey identified the following areas as key CMO priorities:
- Marketing Strategy & Investment
- Marketing Planning & Campaign Strategy
- Marketing Value
- Marketing Organization Design & Development
In short, CMOs agree that their main focus should be defining and executing strategy while proving the value of marketing. Sounds easy, right?
The fundamental responsibilities of the CMO function.
The CMOs who participated in the SiriusDecisions study seem to have a view of CMO responsibilities that is aligned with my perspective. When I talk to CMOs about approaching a role, or CEOs about hiring a CMO, I tell them that the fundamental elements that the CMO must execute are as follows:
- Set goals
- Define (or refine) your strategy
- Build a plan that is designed to achieve those goals
- Execute the plan
- Optimize the plan when change inevitably happens
- Communicate results
CMOs are not getting it done.
Here comes the tough love part: CMOs aren’t delivering on their core responsibilities.
“How dare you make such an assertion?”
My assessment comes from over 30 years as a marketing practitioner, including a 13 year stint as an executive (including 5 years as the CMO) of a public software company that grew to $2B in annual revenue and made over 100 acquisitions during my tenure. After leaving that company, I started Plannuh to try to address some of these issues. Since starting Plannuh, I have reviewed well over 1,000 marketing plans from companies of all sizes, industries, and levels of maturity.
Based on that (large) body of evidence, I can confidently posit that these issues are pervasive. I can also point to many instances in my own career where I have struggled with each one of these core responsibilities. In other words, I am guilty too.
Assessing the Gaps
Let’s explore some of the gaps in a little more detail. I have seen the following persistent issues in each of the following areas:
Every marketing organization should have a clear set of objectives that are aligned to the overall business objectives. The marketing objectives should have specific metrics, targets, and milestones defined. (See some examples in this blog post.)
In practice, many marketing teams either don’t have clear goals, or the goals aren’t well communicated through the organization. In some cases, the goals are well-defined, but there is no connection between the goals and the actual plan. Without a direct connection between the goals and the plan, marketing goals start to feel like an aspirational suggestion.
Define (or refine) your strategy
The lack of a clear marketing strategy is one of the most significant causes of inefficiency in a marketing plan. Your marketing strategy is a great tool to make decisions about the appropriateness of a marketing investment. For example, if you have a targeted account marketing strategy, a broad awareness approach might not be the best idea. You might instead leverage some ABM tools to target your messages to the companies that are on your list.
When I review a marketing plan and see a cornucopia of approaches, I often ask the marketing team to articulate their core marketing strategy. While the marketing leader can often describe their strategy clearly and specifically, the rest of the marketing team often struggles.
For more background on marketing strategy, read What is a marketing strategy.
Build a plan that is designed to achieve those goals
The lack of goal alignment in marketing plans was one of my key motivations to develop Plannuh. When reviewing marketing plans with marketing managers on my team, I would often ask how their activities were related to achieving the marketing goals. The typical response was a stunned silence, or at best, a loose connection to the overall goals.
It was clear to me with my own team, and supported through reviewing many plans, that most teams have a loose connection to their goals at best. This was the issue that kept me up at night when I was a CMO: how could I be sure we were going to achieve our objectives if we didn’t have a plan to achieve our goals? We did a lot of stuff, but I knew that it wasn’t always the right stuff.
Execute the plan
Here’s some good news: if there is one thing that marketers are consistently good at doing, it is executing their plans. There are certainly cases where execution is a problem, but in my experience, I have found that marketers are really good at working toward a plan.
The bigger question is whether the plan is the right one, and designed to achieve your objectives.
Optimize the plan when change inevitably happens
Many marketers are good at optimizing tactics, but few are good at optimizing the entire plan. If you look at digital marketing, you will find that most digital marketing managers are analytical and diligent when it comes to the optimization of their tactics. Note that I use the term “tactics” vs. “campaigns”. Even though Facebook and Google call them “campaigns” in their planning interfaces, they are indeed tactics.
Marketing teams struggle with optimization when you start to think about optimizing across silos. For example, you might be optimizing your digital plan but neglecting the fact that you are struggling with sales tools further down the funnel. Or you may have a plan that includes a bunch of expensive events and under-invests in digital campaigns.
This level of optimization is most difficult because it involves moving resources and budgets between teams.
It may seem counterintuitive given the vast amounts of data and visualization tools available to marketers, but they still struggle to communicate their results in a way that is meaningful to the business. One problem that I often see is cherry picking metrics or campaigns that look good vs. showing the results of the total investment in marketing. We like to think about the concept of Return on Marketing Plan (RoMP), a view that considers your total investment across your entire plan and compares it to the aggregate result.
Another issue with telling an ROI story is the difficulty that people have calculating the full cost of a campaign. Most financial systems do not track cost by campaign, instead showing cost by department and GL code.
The most glaring issue with communicating marketing results is the inability to relate your investments and results to a set of aligned goals. When you communicate results of your marketing investments to the executive committee or board, you need to be able to describe the results in the context of the business.
“That was the tough part, where is the love?”
I’m glad you asked. First of all, I should note that I appreciate marketers so much that I built a company that requires me to spend all my time with them. One of the advantages of starting your own company is that you can pick your customers, and I think I have chosen wisely.
The marketers I have met over the past few decades are smart, creative, hard working, flexible people who are trying to do the right thing for their businesses.
The problem with marketing isn’t the marketers, it is the fact that the tools to manage the marketing function have not caught up with the incredible change that the function has seen over the years.
The changes in marketing that make it harder than ever to be a marketing leader.
While nearly every function in a business has gone through significant changes in the last few decades, the impact on marketing has been profound. Some of the largest areas of change come from the digitization of marketing including:
The explosion of data
The marketing function throws off a dizzying amount of data on a daily basis, often burying marketers in data without providing meaningful insights. At the same time, the expectations for those insights continue to increase.
As a result, the majority of marketing data is thrown away because marketing teams don’t have the skills or tools to handle all the detail. Even the most sophisticated marketing teams with dedicated data scientists can’t handle the full complement of data created on a daily basis.
Measuring what we can measure
One major issue with all this marketing data is that it is not available equally across channels. While a typical B2B marketer spends less than 20% of their budget on digital activities, their reporting is typically dominated by digital insights. All too often, I see management reports with deep analysis of the digital spend with scant mention of the other 80% of their budget.
Massive increases in complexity
The good news for marketers is that there are more choices than ever for spending their budget. The bad news is that there are more choices than ever. If you looked back at a marketing plan from 20 years ago, you might see 50 line items in their plan. Today, it is easily in the hundreds, and sometimes in the thousands. While choice and granularity of the plan can be really helpful, it is increasingly difficult to manage a plan with that much complexity.
Impatience in a real-time world
We have all been trained to expect immediate results. We can call a rideshare and expect a car to show up in 3 minutes, we can order almost anything on Amazon and have it show up at our door within 2 days, and we can spin up a digital marketing initiative in about 2 minutes by clicking “promote this Tweet”.
That expectation of immediacy has made us less patient when it comes to getting results from marketing activities. An awareness campaign can take many months to move the needle as the results build. Content marketing efforts require consistent publishing, tweaking, and promotion over a long period of time to build a real audience.
Difficulty maintaining a strategic perspective
Related to impatience, it is difficult for some executives to maintain a strategic perspective. The best CMOs can think in minutes, days, weeks, quarters, years, and even decades. If you want to enter a new market, shift the competitive landscape, reposition a brand, or build enduring loyalty, you need to be able to define and execute initiatives that span quarters as well as fiscal planning periods.
The tools of the trade need to change
A few years ago, I had a revelation that shocked me: after all this change in the function of marketing, the tools to manage the function had not fundamentally changed in decades.
I looked back at the tools I used in my first marketing leadership job in 1994 and saw that I was using a PowerPoint deck and a few Excel worksheets to manage my marketing plan. More than 25 years later, marketing leaders are using the same basic tools. They may have evolved a little bit to leverage online versions of the tools, like Google Sheets, or SmartSheet, but the basic capability has not changed.
And while spreadsheets are amazingly powerful tools, they were not meant to handle the complex business requirements of a contemporary marketing plan.
This may seem counterintuitive given the fact that there are over 7,000 marketing technology companies offering solutions in the market. But when you look at the data a little closer, you realize that the vast majority of those tools are focused on the delivery and optimization of one particular marketing channel vs. the aggregate management of the marketing function.
Looking forward to a new way: a cognitive marketing network
This combination of the massive change in marketing and huge gap in contemporary systems inspired me to build Plannuh. We have a big vision: the Plannuh Cognitive Marketing Network will leverage the world’s expertise for achieving perfect marketing strategy performance. We believe that we can help marketers realize their potential by leveraging AI to facilitate their strategy execution.
We saw the need a few years ago and have started to build toward this strategy. Like all big strategic ideas, they start with a first step. Our first step is to build the world’s best budget management platform. We chose this step first because we knew that connecting the budget, plan, and performance tracking would deliver incredibly valuable insights to marketers.
We recently got some amazing support to build out that vision with the resources of two of the leading AI investment firms, Glasswing Ventures and Google’s AI fund, Gradient Ventures.
I’d love it if you came along for the ride with me.