What's at the Heart of the ‘Hyper-Relevant’ CMO?
A new study points to improving the customer experience and embracing disruption as key ingredients for CMO survival
Chief marketing officer is not considered one of America's most precarious jobs, but perhaps it should be.
A recent study from the executive search firm Spencer Stuart found that while the average tenure of CMOs in 2018 was 43 months, the median tenure was only 27.5 months in 2018, down from 31 months in 2017, The Wall Street Journal reports.
Given such a narrow window, CMOs are under growing pressure to deliver results quickly, not just regarding siloed metrics like brand awareness and affinity, but on overall company goals such as sales, profitability, and shareholder value.
"They have very short shelf-lives, so when they start the clock is already racing," says Jennifer Hohman, global CMO with ad agency FCB Worldwide. "Not a lot of CEOs have the time or the patience to stay with the CMO for the long haul."
To succeed in that kind of pressure-cooker environment, today's CMOs must be hyper-relevant from day one, especially given the disruptions taking place in how brands engage their target audience and the expectations consumers now have about those brands that are looking for their loyalty.
But a recent report from Accenture found that only a small percentage are actually up to the challenge.
According to the report, titled "Way Beyond Marketing: The rise of the hyper-relevant CMO," more than 75 percent of CMOs admit that past formulas are no match for the new breed of "disruptors" who are pulling ahead of competitors by delivering more relevant customer experiences. "Just 17 percent of the nearly one thousand CMOs we interviewed in our global survey told us that they have been extremely successful at delivering highly relevant customer experiences," the report says. "So, what impact [are the 17 percent] having? Significantly greater value to shareholders."
What separates those hyper-relevant CMOs from the rest of their peers who took part in the study, Accenture suggests, is a willingness to embrace the disruptions taking place in marketing, along with a focus on getting the right capabilities in place to deliver exceptional customer experiences.
"They're looking inwards in recognition that, to enable their organization to flow around the customer, they must challenge business as usual and inspire changes," the report says. "In fact, [CMOs are] 26 percent more likely to say that marketing should own the customer record throughout the customer journey — from first contact, all the way through to sales and service — and that marketing should be able to leverage and benefit from the insights derived from that data."
Larry Thomas, North American lead, customer insight and growth at Accenture, stresses that this is not simply a matter of some CMOs incrementally outperforming their peers. "The gap between the hyper-relevant CMO and most others is so big," he says, adding that the stakes for many companies couldn't be higher, yet many seem unprepared for what's in store. "There's a time bomb there," he says. "A lot of brands are sliding down the hill toward irrelevance."
Day-to-Day Hyper-Relevance
The Accenture report provides a macro view of the importance of hyper-relevant CMOs embracing disruption and aligning more closely with the rest of the C-suite.
But with so many changes taking place in how consumers perceive and engage brands, it may not be enough to simply embrace disruption; CMOs need to determine which new channels they can safely ignore and which present opportunities to bolster their overall value.
"Today, you have so many different ways to engage the consumer — and it's the CMO's job to make sure their brand is always showing up in an authentic way and in a relevant way," says Hohman of FCB. "But if the CMO is always worried about the pieces and the parts and connecting the dots, they're not going to ever have a moment to pick up their head and go, 'Am I helping people care about my brand, am I helping drive business, am I touching hearts and making people care?'"
For Jennifer Breithaupt, global consumer CMO at Citi, that means hyper-relevancy must also include hiring the right experts within the marketing department to help with day-to-day decision making. "Because of the increasing scope of responsibilities that marketing teams are now tasked with as the landscape shifts at an incredibly rapid pace, CMOs can't possibly be the be-all and end-all," she says. "We need to hire well and trust our teams to execute with our strategic input; otherwise, we're just creating an unnecessary bottleneck that will stall growth and progress."
Hyper-relevant CMOs need to be both a top-down brand visionary and, when possible, a granular expert on key emerging channels for consumer engagement. "Today's CMO needs to think big and small at the same time," says Esther Lee, EVP and global CMO at MetLife. "As a leader who wants to empower an amazing team to do their best work, my first job is to provide the strategic context and executional imperatives tied to the business needs to help drive my team's work."
Lee also suggests the hyper-relevant CMO must continually be willing to transform the marketing organization, hire new talent, and integrate capabilities such as digital experience design and UX/UI, social content strategy, and digital lead generation. "Having said that, it doesn't absolve me from knowing what is required to excel in these areas and who are the external partners that can best help us achieve success," Lee says.
Kimberly Whitler, assistant professor of marketing at the University of Virginia's Darden School of Business and former CMO at David's Bridal, points out that 10 years ago most CMOs came up through the marketing ranks, taking on roles for an internal marketing department before ascending to the top spot.
However, today's hyper-relevant CMOs are unlikely to have that type of background, but still need to know enough about each of these roles so that they know what to look for when hiring.
"Today's CMO is more like an orchestra leader," Whitler says. "They don't have to know everything, but it is important to know what to look for in hiring people to be those experts and then learn from them."
Andrea Brimmer, chief marketing and public relations officer at Ally Financial, says she changed how she approaches her CMO role. "I've been in this business a long time, and things have changed so much in the past five to 10 years that the old ways just don't work anymore, and the pace of change is only accelerating," she says. "The lines between marketing and other functions have blurred, so today's CMOs must have their pulse on the ways in which customers are evolving and be their voice to the rest of the business to affect customer experience."
Data and Agency Partnerships Fuel for Thought
The Accenture report stresses that hyper-relevant CMOs use data not just as a measurement tool, but also as the catalyst for building better relationships with other C-suite stakeholders and driving change throughout the entire organization.
MetLife's Lee is a strong advocate of data, but says it's crucial for CMOs to also occasionally step back from quantitative metrics.
"Data is critical to how we drive our business and make decisions, and we have more data and better data than ever before," she says. "But the biggest risk to over-relying on quantitative data for our marketing strategy is that the data you have today tells you what is happening today. It won't necessarily tell you where you need to go tomorrow. Given the pace of change, we must couple data-driven decision making with nourishing ourselves with an understanding of the forces and inspirations that will shape how our consumers and customers will live, make decisions, and form relationships with brands in the future."
Hyper-relevant CMOs are intent on not just finding new opportunities for consumer engagement, but changing and expanding the notion of how to market, including the relationship with outside ad agencies.
Britton Upham, CEO of Austin, Texas-based McGarrah Jessee, the agency that helped Yeti and Costa Sunglasses become trendy mass-market brands, says agencies still need to provide CMOs with the benefit of outside perspective and inside knowledge of platforms, media, and consumer behaviors. But to help CMOs reach hyper-relevancy, he adds, they need to play an even more important role: being an agent of courage and confidence.
"It's a massive alignment effort to get something daring to pilot alongside something safe in an established company or especially to disrupt convention entirely," says Upham. "Great agencies prepare for the battle to get such ideas through — in partnership with great CMOs. Beyond the initial emotional unveiling, a meeting which almost always goes well, they consider the harder meetings ahead: operations, finance, sales. They eliminate concerns; they convert skeptics to champions. At the very least, they secure permission for trial."
FCB's Hohman adds that advertising firms can't just be content with being the agency of record for today's hyper-relevant CMO. "The agency's role is also to be fearless in ensuring the brand has the resources they need, regardless of whether it's in the agency's walls or not," she says.
The Accenture report notes that hyper-relevant CMOs are 29 percent more likely to be in-sourcing new capabilities, and Hohman says agencies must be responsive to that change. "Agencies have to look at brands with these models and think, 'How can I be flexible and nimble depending on the situation?'" she says. "Some of them work with almost no infrastructure and use partners as a complete extension of their business. Others are building more and more capabilities in-house, so they have greater control."
The Hyper-Relevant Future
Some of the most salient changes taking place are companies breaking down the traditional C-suite roles and responsibilities.
Earlier this summer, for instance, Uber dismissed its CMO, along with its COO, combining its marketing, communications, and policy teams under PR. In July, McDonald's announced that it has no plans to replace Global CMO Sylvia Lagnado when she departs in October and instead will create two new roles at the senior vice-president level to divide her responsibilities.
While these moves may be seen as threat to the traditional CMO role, Thomas of Accenture predicts that other companies may simply opt to expand the responsibilities of their brand/marketing executive(s) to include channels like sales and product development, because they're all interconnected to the overall customer experience.
Lee points out that marketing, including the metrics to measure success, can no longer operate in a vacuum. "At MetLife, marketing shares accountability for the business results, as our customer strategies are key levers for driving growth and value," she says. "So, not surprising, our most important metrics are financial ones. Beyond these, we track several customer metrics as part of our dashboard — some 'lagging indicators' like persistency, upsell/cross-sell, and referral; some leading indicators that like brand perceptions, experience ratings, and operational achievements. As part of the business team, we have shared goals and shared success metrics."
Citi's Breithaupt suggests that hyper-relevant CMOs possess a deep understanding of the growing importance of technology, not just as it relates to today's advertising landscape, but in the world in general.
"A core competency in digital isn't just a 'nice to have' skill anymore; it's a 'must have' as technology continues to wholly transform our world," she says. "For CMOs to be effective, it's key to continue to adapt, stay ahead of the curve, and anticipate what's next."