Most senior marketers would probably argue that without a chief marketing officer in the boardroom, the opinions of the customer are not represented at the top table.
Yet CMOs often struggle to influence their chief executives. Peers such as the chief information officer (CIO) or the chief financial officer (CFO) seem to fight their corners more successfully.
Sam Instone, CEO at wealth management company AES International, which won The Sunday Times Fast Track 100 Best Management Team Award in 2012, says that in psychological terms CMOs tend to be either goal-oriented ‘drivers’, who strive for results and react quickly, or ‘expressives’, who enjoy involvement, excitement and interaction.
“CFOs, on the other hand, are more analytical and concerned with being organised, having all the facts and being careful before taking action,” he says. Although Instone cautions that “boards do not have the top seats reserved for any set personality type or skill set”, it is the inability to back up decisions with facts and figures that is often cited as a shortfall in marketers’ abilities.
Given the need for evidence-based reasoning in boardrooms, the explosion in marketing technology could become the senior marketer’s most likely route to the ‘C-suite’. Technology is enabling CMOs to demonstrate the return on investment (ROI) from what they do more effectively, and savvy CEOs now appreciate that their organisations need to keep abreast of this in order to take advantage of advances in digital media and business data.
According to research company Gartner, CMOs will spend more on IT than their companies’ CIOs by 2017. Gartner says about 30 per cent of marketing-related technology is already bought by marketing departments. The growth in CMOs’ influence as they take more control of purchasing could help to calm some of the fears outlined in IBM’s From Stretched to Strengthened study, which surveyed 1,734 CMOs from 64 countries in 2011.
The study emphasises how senior marketers are increasingly under pressure to provide quantifiable evidence of how their marketing expenditure helps an organisation to achieve its goals. IBM says that many CMOs accept they need a better mix of financial, technical and digital skills in order to become regular board members.
Jussi Wacklin, a former Nokia digital director who has also held a number of managing director roles, agrees that for a CMO to thrive on the board they must understand the role of technology and display broader business skills. “What is crucial is an appreciation that the overall goal of an organisation is to maximise shareholder value,” says Wacklin, who is now a digital marketing consultant.
One senior marketer who has several years of international board-level experience is Burton’s Biscuit Company CMO Stuart Wilson. He has worked in business and marketing strategy, profit and loss management, and mergers and acquisitions. He has also led multi-functional teams as European vice president of the biscuit category at Kraft Foods and director of grocery at Premier Foods.
He agrees that all senior marketers would benefit from getting more comprehensive experience as they move up the career ladder.
“I started my career in market insights, which gave me a consumer context, and I then gained experience in category management to understand the trade customer’s perspective, before gaining knowledge of the financial side of the business as a general manager,” says Wilson.
“By moving around I was able to see opportunities to share best practice across categories and brands. During my time in trade marketing I was always keen for the UK to be the guinea pig for new ideas.”
Burton’s Biscuits’ best known brands include Maryland cookies, Wagon Wheels, Cadbury Fingers and Jammie Dodgers, and the influence of marketing in the boardroom is evident. Wilson’s multifaceted CV adds weight to all discussions around corporate strategy as he brings the consumer into the boardroom to challenge the business’s assumptions.
Burton’s Biscuits has increased its marketing and new product development investment every year since 2009, prompting a rise in value sales for its top brands of 16 per cent. Revenues for Wagon Wheels alone were up 70 per cent last year, following a relaunch accompanied by a brand campaign.
“A CMO must be commercially savvy, so my role is to make sure the business sticks to this investment-led agenda and to keep demonstrating how our brands are delivering a return on investment,” he says. “We have clear key performance indicators for our brands, which have high market shares. We continually use technology to track the ROI and use econometric modelling to assess our advertising and new product development.”
There is a view that senior marketers are particularly useful at large companies when they sit on an operational board, one level below a top-level group executive board. Bryan Scott, marketing communications director at media company Metro UK, which is owned by Daily Mail and General Trust, sits on such a board.
“[Metro is] has a strong executive team. Very few decisions are made in isolation as there is a real acknowledgement that all our business functions need to point in the same direction,” he says. “If we weren’t aligned, our marketing messages would be out of sync with reality.”
Scott says the CMO is the owner of the relationship with the customer, but at Metro every senior executive, including the finance director, product development director and commercial director, must be focused on advertisers and readers.
“Yes, our product development director will have a much deeper understanding of the technology we deploy, but as marketing communications director, I must have a view on how that technology enhances the overall user experience to communicate this to our audience.”
MaryLee Sachs, former US chairman and worldwide director of consumer marketing at PR firm Hill + Knowlton, says: “The CMO is arguably the least understood role in the C-suite by both the outside world and internal audiences.”
Sachs now advises top CMOs and a book entitled What the New Breed of CMOs Knows That You Don’t will be released this month, aimed at CMOs tasked with driving change in their businesses.
She says: “Job specifications differ widely – much more than for the CEO or CFO. Many CEOs are looking to their CMO not only to be the window to their consumer but also to help with change management across the organisation. CEOs in FMCG companies tend to understand the importance of having a good CMO. The B2B space is a tougher nut to crack.”
Among the senior CMOs fighting marketing’s corner in the B2B and the B2C arena is Jonathan Becher, CMO at business management software company SAP. Becher is not yet a board member but he is invited to board meetings where discussions increasingly focus on how marketing can position SAP in the future and what that future will look like.
“Traditionally, most CMOs had long careers in marketing and often did not have strong business backgrounds,” he says. “In future we will see CMOs with more diverse experiences, leaders who understand the audiences and the organisation from different angles and who can play an integration role in changing customer experience across all functions in the company. These CMOs will earn a seat at the boardroom table.”
He says CMOs remain in a unique position to be a catalyst that uses market insight to stop the organisation from resting on its laurels.
“Boards are missing a big opportunity if they are not using their CMO in this capacity,” he says. “But being responsible for buying technology isn’t what will get CMOs into the boardroom; it is how they use the technology that will get them there. Technology allows CMOs to gain insights about their customers and where the market is heading. These insights add value to the business and help inform decision-making at the very top level.”
Roy Hoolahan has 23 years’ experience in consumer marketing recruitment as managing director of Ball & Hoolahan. He says marketers can enhance their influence by taking senior general management roles to acquire these sought-after broad commercial skills.
“Ultimately it does not matter who plays the role of CMO as long as the whole business operates as a marketing-led, and consumer-led, organisation to achieve profitable growth,” he says. “What is crucial is that organisations place consumer understanding and marketing at the heart of their decision-making, even if there is no official CMO in place or on the board.”
Global Marketing Network
Darrell Kofkin, chief executive of international marketing accreditation body Global Marketing Network (GMN), says CMOs need to improve their skills in strategic management, leadership, developing global marketing strategies and have a tighter grip on the finances.
The GMN has more than 30,000 members worldwide and Kofkin says marketers that can demonstrate these broader business skills will make it to the boardroom and stay there.
“If there is not a CMO in the boardroom who can offer customer insight, CEOs may ask the CIO to take the lead on marketing just because he or she understands digital and technology, and this cannot be right,” says Kofkin. “Marketers are under pressure to demonstrate ROI and leadership but the use of technology to understand customers in real-time has strengthened the CMO’s hand.”
Kofkin would like to see more CMOs on company boards and says that this is already happening in the US. “If a CMO is not there, who is representing the voice of the customer in the boardroom?”