The Chief Marketing Officer role is as high as it gets in marketing—but so are the expectations that go with it. To deliver, CMOs will need to adopt new operational frameworks for harnessing the art, science and individuals involved.
Today’s CMO is smarter, wiser and—contrary to popular belief—enjoys a higher average tenure. But it hasn’t always been this way. What happened? Let’s take a short trip back in time and experience the evolution of this executive. Her ascendance was always in the cards, but she had to wait for the rise of another player.
In what is perhaps the most memorable moment in Mad Men—the popular TV show about the heyday of mass marketing—fictitious 1960s adman Don Draper brings a roomful of men to tears with a pitch for a product that would soon be iconic. But for anyone watching the show—a half-century into the future—the power of the scene comes not from what the pitch means for the future but instead how it addresses our need to connect with the past. Indeed, the concept for the scene, the episode and the entire show is nostalgia, which Draper defines as a “twinge in your heart, far more powerful than memory alone.” Draper renames the product—a slide projector—“The Carousel,” because it “lets us travel the way a child travels—around and around, and back home again, to a place where we know we are loved.”
The scene provokes nostalgia not just for the characters but for each viewer, and particularly those with ties to the marketing world. For everyone and everything in this scene—the people, their purview and the product (a romantic product from a simpler, bygone age) would someday be disrupted. Next time you watch this scene, ask yourself: who works inside the enterprise, and who works outside? Who is at the head of the table, and who is off to the side? But it’s just as important to ask who is not in this scene. In a bit of creative brilliance—and misdirection—the hero of “The Carousel” is not anyone from Kodak nor from Draper’s fictional agency. The hero is the customer, dramatically projected on the wall of the conference room. The reason the people in the scene—and we as viewers—are bowled over is that they see themselves on the screen. They were experiencing not only a brilliant business pitch but the beginning of an unstoppable trend: the rise of the customer, she who would ultimately flip the conference room table and rearrange the many relationships in the marketing ecosystem. As we show later in this article, even the table itself—a real and symbolic theater of operations for marketing people—is swapped for another. Despite all that, some things remain the same.
In the pages that follow, we’ll take a close look at what has changed and what has not. And we’ll take a look at the rules and tools that marketing executives now have at their disposal to do the work of connecting with the customer. We’ll also consider how the myth of the all-powerful creative genius outside the enterprise would be supplanted by the impossible ideal of the all-powerful CMO (Chief Marketing Officer) inside the enterprise. It’s a myth that’s worth exploring—and deconstructing. For the history of the CMO, in part, is about the positioning and marketing of the CMO. And if there’s anything we know about CMOs, it is that they are very good marketers.
To understand what life is like for the CMO today, it pays to look at this story. And while the 1960s are a good place to start the narrative, there are other intervening periods, each with its own disruptions, and each with a specific set of challenges.
They looked into the hearts and minds of the customer. And, perhaps for the first time, a few of these masters found a home inside marketing where they could design memorable campaigns. It was a turning point. Marketing would never be the same.
Let’s begin with the actual “Mad Men,” a class of creative professionals whose moniker refers to the mecca for marketing minds of the day (Madison Avenue in New York) and alludes as well to the legendary temperament of its most talented practitioners. The reputation of the creatives was in part undeserved, but telling. The rap: they are not like us; they are special (in a good way and in a bad way). And if you were a client back then (e.g., a CMO predecessor), you understood that you would have to look outside the enterprise and make that visit to Madison Avenue. You needed them.
But what else can we say about them? First, they had a profound and lasting effect on the still young marketing industry. Some, like Bill Bernbach, co-founder of agency giant DDB, and George Lois, one of the alleged inspirations for Mad Men’s Don Draper, continue to inspire practitioners today. Second, while their reputation for flash tends to dominate, what the best from this era stood for was something quite different: a more quiet and deliberate attempt to focus on the customer. In his recent book, Lois talks about the marriage of art and text that produced famous campaigns like “You Don’t Have to Be Jewish to Love Levy’s.”1 At a time when the creative mystique was running at its highest, Bernbach and Lois were at work laying down the law, which prescribed connecting with the customer. They looked into the hearts and minds of the customer. And, perhaps for the first time, a few of these masters found a home inside marketing where they could design memorable campaigns. It was a turning point. Marketing would never be the same.
The Levy’s campaign is a good segue to the next period: the era of targeted marketing. Marketers gradually found ways to cleverly expand their companies’ appeal by segmenting their messages to multiple demographic, psychographic and other types of customers. Over the next couple of decades marketing would witness the acceleration of databases, CRM and—toward the end of this period—a new tool for direct marketing: email. The magazine industry exploded, going from a handful of publications that advertisers could reliably depend upon to hundreds of new titles that targeted and chased the increasing heterogeneity in America.
And TV? Marketers had to navigate a bewildering expansion from three broadcast networks to the huge and expanding catalog of channels on cable TV. And the targeting had an impact on the marketing ecosystem as well. The supplier network fragmented as agencies specialized to remain competitive. And, of course, with these new skills and competencies came a new wave of leaders. These were the days of Robert V. Goldstein, a VP of advertising at Procter & Gamble—an example of a modern CMO—who was a leader on the impact of mergers in advertising, and also recognized and responded to the impact of cable television.2 And, perhaps fitting at a time when brands were increasingly seeing the benefits of customer diversity, these were also the days of executive diversity. For example, there was Charlotte Beers, the first female vice president at J. Walter Thompson and later CEO of Ogilvy & Mather. And there was Tom Burrell, the founder of the legendary Burrell agency, focused on the needs of African-Americans. This was also the era when Hispanic marketing came into the mainstream.
Indeed, the leaders in this era were more diverse—by gender, race and religion. Some were inside; some were outside. Some were on the creative side of the business; others were more on the side of the new sciences that were entering the world of marketing. And along with this diversity came complexity. The simple time of Mad Men—those days were over, though they still played on the imagination of both the industry and the public.
With their appetite for facts and figures now whetted, marketers took a keen interest in the scientific side of the profession and began importing and developing new competencies. From the 1980s to the end of the century several branches of technology- and science-enabled marketing emerged. This is when many of the top companies first began to work with sophisticated systems, which allowed, for example, for targeting segments all the way to “one.” The analyses at first came with esoteric names like “hidden Markov models” and “auto-regressive moving averages.” But there were simple names too. The Burke Recall Test, as an example, swept through this era as way to measure viewers’ recall of TV commercials. (“Hey, we pulled a 35 on Burke; let’s knock off early!”) In the laboratories, marketers were also looking at “controlled geographies” across the United States, attempting to isolate the variables of media spending and creative change.
If the three-piece suit was the signature garb of Madison Avenue, the power suit of the new era was the white lab coat. The marketing whiz held the consumer under the microscope, entered her home and studied her with pen and pad—and increasingly, computer—in hand. But there were organizational changes as well. What drove the adoption of the new scientific tools was the ongoing rise of consumerism, and the new consumer sciences held the promise that marketing could be measured like any other business function. Marketing was accountable after all. It could, in fact, create a new place in the C-suite, where the ability to discuss numbers is the price of admission.
According to some who have studied the topic, the rise of the CMO title came around the time that the Web rose to prominence and ushered in the digital era. As one industry insider later opined—in a blog entitled “Are You a CMO or a VP of Marketing?”—this was the age of hype, and Internet marketers were of course “good at marketing the job of marketing and themselves.”3 In an article for Forbes, two others noted, “like so many things during that period, [the CMO title] was driven by a preoccupation with appearances more than by practical need.”4
While it’s true that many businesses assigned the CMO title in the digital era, an alternative explanation is, once again, the steepening rise of the customer. This rise was apparent in the creative era. And it was palpable in the subsequent targeted and scientific eras. In the digital era, however, there was a leap in customer centricity. Marketing would never be the same. The tools that emerged in this period—the graphical user interface (GUI), click-through advertising, display ads, e-commerce and search—all derived their strength from providing a new experience for the customer. Well before the dawn of Web 2.0, we heard the mantra that the customer was in charge.
In practice the customer had always been in charge, but now the tools of the trade for engaging them were more direct, more transparent and increasingly more interactive. The digital era, defined by the disruptive force of the Web, gave way to a new pantheon of technology players to accompany the buyers (the brands), the sellers (the agencies) and the publishers (the media companies). And square in the center of this disruption was Google’s big bet on a new category—search—which placed the customer’s immediate desires smack in the middle of the universe. Perhaps the best way to frame the value of search came from John Battelle in his book The Search: Google is a “database of intentions.”5 A database of customer intentions, to be precise. In the digital era, the customer truly began to call the shots. But this era doesn’t belong to Google alone. It was the beginning of an era marked by many innovations in online interaction and mobility. And, yes, the beginning of a large new category that would figure even bigger in the next era: social media.
But what was the impact on the job of the top marketer, the newly minted CMO? With each successive phase we saw the steadily accelerating rise of customer power. And with each successive phase we also saw the emergence and consolidation of organizational power with the top-ranking marketer. With the rise of the customer came the rise of the CMO. Finally, each era also came into being with one or more major disruptions by way of media, technology or social change. So as she rose, the job of the top marketer kept getting harder. The history of the CMO we have plotted thus far follows a precipitous path—more a storyline for a fallen hero like Icarus—destined for a short lifespan (tenure) because of his or her ambitions.
So as she rose, the job of the top marketer kept getting harder. The history of the CMO we have plotted thus far follows a precipitous path—more a storyline for a fallen hero like Icarus—destined for a short lifespan (tenure) because of her ambitions.
It pays to take a closer look at some of the details of the job inherited by the CMO in recent years. On one level, as noted, there were things that made the new job harder. On another level, there were relationships with a new group of peers and professionals that would have been foreign to the 1960s adman. The combination of the two made life very challenging.
First, the skills became expansive. In addition to assuming the roles of the creatives, targeters, scientists and digerati, what exactly are the expectations for today’s CMO? It helps to begin by looking at how the job of marketing has been framed. The marketer is responsible for the customer. To paraphrase Philip Kotler, one of the influential leaders in marketing education, marketing is about “meeting customer needs profitably.”6 And as Wikipedia has defined it, “marketing is used to identify the customer, satisfy the customer, and keep the customer.”
Expanding on this view in the context of the top marketing job, one commentator observed that “a CMO should be the interface between the company and the customer—responsible not only for marketing communications but also product development and sales.”7 This expansion of scope has been a common theme in articles about the CMO job in media and marketing publications.
“Some CMOs,” according to an article in MediaPost, “are taking responsibility for functions including operations, finance and public policy.”8 And this expansion has ultimately forced top marketing execs to acquire not just any type of skill but those more typically associated with a better known member of the executive suite: the CEO.
In an article entitled “The Rise of the Chief,” Lesley Young noted that “being a CMO in most cases results in new responsibilities and a heavy-duty reliance on basic business skills. For better or worse, CMOs accept that their title means they are now under the corporate spotlight and glaringly accountable.”9 And are there any particular executive suite skills that he or she should master? Strategy, metrics and analytics. CMOs gain credibility, according to one writer, “not by touting taglines but by crunching numbers.”10 CMOs, wrote another, “distinguish themselves with the “strategic long-term view, exceptional measurement and analytical capabilities and financial management.” The title of a recent article in Ad Age proclaimed, “When CMOs learn to love data, they’ll be VIPs in the C-suite”—but not until then.11
And if all of this is not enough, the modern CMO has to do this work in the public eye, more than perhaps any other person on the executive team. In an article entitled “Why Do Chief Marketing Officers Have Such a Short Shelf Life?,” Mike Linton, the former CMO of eBay, noted, “just like major league managers, a CMO’s game plan and tactical brilliance are on display every day.”12
And what about the relationships with the marketing chief’s new peers? If the need to get real about numbers wasn’t enough of a clue, let us be clear: the CMO now needs to be cozy with the CFO. The CMO today needs to be fluent in the lingua franca—financial returns—of all corporate boardrooms, and the CFO is the person closest to these types of numbers.
And another relationship has arisen as well, precipitated by forces we will examine momentarily: the CMO’s relationship with the CIO. While it’s now commonplace to talk about how these two people must work together, not long ago the idea was unimaginable. The importance of technology in the execution of today’s marketing has created a sense of urgency for this alliance. Perhaps the most dramatic illustration of this point came recently in a Gartner report that stated that by 2017, “an organization’s CMO may have a bigger ‘IT’ budget than the CIO.”13
With this type of future, clearly the CMO and CIO will need to become cozy. But this sounds easier than it is in practice. The language, culture and values of the two have been, for decades, worlds apart. No wonder a recent Ad Age proclaimed that large consultancies increasingly are asked to provide the services historically associated with traditional marketing services agencies.14
And finally, whose job is it to bridge all these worlds—the customer, the organization, the C-suite? Because the aggregation of skills and relationships is being driven by the urgency to keep up with new ways of identifying, satisfying and retaining the customer, we suspect that this job of bridging, like so many others, will go to the CMO.
If you ask industry observers to comment on the expectations versus the performance of CMOs today, there is a big delta. First, there is the notion of the “super CMO,” which Ad Age has described as someone whose mission “isn’t just marketing, but strategy and overall growth” of the company,”15 or the CMO as a “super species,” defined by Media Post as someone who has “responsibility for functions including operations, finance and public policy.” Slightly less aggressive, but still elevated, is the idea—from one of the top talent recruiting firms—of the CMO as “marketing’s CEO.”
The CMO is, of course, as high as you can go in marketing. But the expectation should give one pause. The role of the CMO has been fluid and rapidly changing, and some of the new responsibilities have come so recently as to make it nearly impossible for many to get their arms around them. The average tenure of CMOs, perhaps, tells that story. As a Spencer Stuart survey reported in 2008, the average tenure for CMOs was just 28 months, up a mere four months from 2004 (see figure 1).16
That CMOs would fare so poorly in the face of such great expectations should come as no surprise. But like so many other things in the history of marketing, there’s more here than meets the eye. In their 2010 CMO survey, Spencer Stuart reported that the average lifespan of the CMO rose by an astounding 14 months—to a new record of 42 months—in only two short years.17
Source: Spencer Stuart Press Release
Figure 1. Average tenure of the chief marketing officer
This raises a question: If the previous eras in the history of marketing—creative, targeting, scientific and digital—were each brought about by a technological or social disruption, what was the disruption in the last two years that solidified the role of the CMO? Our answer: the network-driven empowerment of individuals. This includes networked customers, of course, and also everyone else in the marketing ecosystem.18 Network-driven empowerment may in fact be the disruption driving our current CMO era, which we call the postdigital era. If the CMO owns the disruption, great things can happen. If not, woe to the CMO.
But what are the new tools of the trade that might in fact enable the CMO to “own the disruption?” Let’s start with the technology, because in many ways it is responsible for this postdigital era. Shortly after social media burst on the scene, savvy marketing thought leaders made it clear that the business premise of all this is the connected individual. Networked customers can now be motivated to work on behalf of companies by co-creating the brand and sharing it within their own networks. The rise of social networks such as Facebook, Twitter and others has enabled more than a billion customers to interact in this manner. It’s not just connected customers buoying the CMO; it’s also the networked employee, the connected supplier, and of course the networked citizen. Myriad industries are expanding their market footprint by empowering people in their ecosystems, and social technology in all of its forms, is helping to drive this growth.
But there’s more to this story than just social technology. The disruption that has helped usher in the postdigital era is also about analytics, which enables organizations and their participants to know virtually everything about one another; it’s about mobility, which enables all actors in the ecosystem to connect, wherever they happen to be; it’s about the cloud, which provides participants with a more flexible, scalable and affordable infrastructure for networking; and it’s about cyber security, which enables organizations to manage the attendant risks of new technologies. And while each of these tools is powerful on its own, they are even more potent in the composite. A good example of this is innovation in the automotive industry, where expectations driven by the connected customer are forcing manufacturers to rethink their in-car experience. What infrastructure (cloud) would enable a car company to deliver an Apple App Store-like experience inside its vehicles? What platforms (mobile) would the apps live on? What’s the interaction (social) between customers and others in the ecosystem (the manufacturer, the dealer, the customer service rep and other customers)?
Finally, there’s more to this postdigital era than just technology. There’s enablement. Today’s CMO can connect to customers in ways a 1960s adman could not imagine. Today’s marketer can literally create a meaningful and intimate connection with billions of customers all at once. The new requirement for customer intimacy at scale may in fact be the simplest explanation for the CMO’s lengthening lifespan.
In the Mad Men era, marketing was revered in part for its utter simplicity: the creative process—the marriage of art and copy. But marketers were constrained by the limitations of mass media. In the targeting, scientific and digital eras, new tools emerged to enable marketers to communicate with an increasingly diverse and empowered customer base. Throughout all this time, however, it was still marketers talking to customers.
In the new postdigital era, marketers help their companies become part of a larger system where the opinions of all stakeholders are in play simultaneously. Now companies must really, every day and hour, listen and respond to their customers. In contrast to yesterday’s one-to-many channels, CMOs must manage on a many-to-many basis.
To meet the new challenges in this new era, CMOs will of course need to adopt new operational frameworks for harnessing the art, science and individuals involved. The job of the CMO is not easy, prompting industry wags to say that it requires superhuman skills. But already we’re beginning to see innovation in this area in a wide range of sectors.
One framework that has recently emerged across a range of sectors is the three-dimensional engagement matrix, or “the engagement cube,” as articulated by our colleagues Chris Heuer, Dan Elbert and Dan Nieves (see figure 2). The effectiveness of an organization’s marketing hinges on its ability to empower all constituencies at once—internal and external—through a vast and complex ecosystem. The cube enables organizations to quickly visualize all these networks, diagnose their strengths and weaknesses, and, most importantly, gaincompetitive advantage. It also helps organizations better understand who they are—and what they can be—in the new world that postdigital technology and practices have wrought.
This approach to reimagining and empowering new ecosystems is beginning to take hold in a number of industries and often through—you guessed it—the marketing departments. The cube is part of a larger framework designed to enable the CMO to understand the actual costs of managing and activating a multiconstituent ecosystem. And that is perhaps the framework’s most disruptive feature—it enables the chief marketer not only to see what’s working and what is not, but to find ways to disintermediate the middleman where disintermediation makes sense. For in the postdigital world, where the rules of tools of engagement have come in house, the CMO increasingly has the opportunity to “own” the relationship with the customer. But the simplicity of the cube—a deliberate rethinking of the unwieldy relationship matrices that marketers struggle with today—is just as noteworthy. For in the end, what will really distinguish the postdigital CMO is his or her ability to follow this profession on its accelerating purpose: to connect with the customer.
Figure 2. "The Cube" engagement matrix (illustrative)
This tool—which you can imagine today’s CMO spinning and turning in the palm of her hand—is an elegant reminder of the power of her calling. And as with the carousel in that scene in Mad Men, we’ve come around and around and are back home again. The top marketer is at the top of the table, albeit a different table (in the executive suite) and with a different set of tools. And she still commands our attention.