Short-term marketing tactics are increasingly taking precedence over long-term brand building, and whether it’s a symptom or a cause, the tenure of marketers is also getting shorter, as is the length of agency relationships.
Marketing Week’s Salary Survey of UK marketers shows 81% are planning to leave their post in the next three years and 39% aim to exit within the next 12 months. In addition, Marketing Society figures show the average tenure of CMOs in the UK is only 18 months.
This picture is echoed across the Atlantic as the average tenure of marketers at US consumer brand companies dropped from 48 months in 2014 to 44 months in 2015, the first decline in average tenure for a decade, according to a report from consulting firm Spencer Stuart.
As marketers move from brand to brand so often, it calls into question whether CMOs are the best brand guardians, particularly when it comes to implementing long-term brand building campaigns.
The issue of short-termism was raised by an IPA report in June that suggests the use of short-term metrics to measure campaign success is resulting in a sharp drop in creativity and diverting budgets away from longer term brand building activity.
Author of the IPA report Peter Field says short-term tenures undermine “some of the motivations in seeing things through” but his bigger concern is the fact marketers are put under increasingly short-term pressures, making it “practically impossible for them to do that long-term job”.
Susan Smith Ellis, CMO at Getty Images agrees. She says: “CMOs move on a lot because they’re under so much pressure. It’s such a different job from what it used to be. I think about the fact you are expected to be a brand steward and at the same time constantly optimise a gazillion digital channels. In effect you are almost being a direct marketer, which doesn’t necessarily [require] the same skill set.”
However, Field aims his accusation “firmly at CEOs and chief financial officers”, who are being “seduced by the mantra of short-termism that is coming very strongly out of the digital world”.
“It is unreasonable to expect marketers to address the long term when their jobs and livelihoods are on the line,”
Peter Field, IPA
“I blame it more on a business culture,” he says. “Marketers often [understand the need for long-term thinking] but their problem is they cannot convince the CFO, who is saying ‘I don’t give a damn about the long term, I just want a good quarter’. It is unreasonable to expect marketers to address the long term when their jobs and livelihoods are on the line.”
Creating ‘business memory’
The Royal Shakespeare Company (RSC) is currently going through a digital transformation and has brought in Richard Adams, consultant digital programme manager, to oversee the project. Although he is working to a two-year time frame and says it is “a big thing that people tend not to stay very long” in one particular role, he also believes data is the key to continuing a long-term project.
“The thing about taking a long-term approach to data, and starting to analyse trends, is that knowledge doesn’t disappear and the next person that comes in can pick it up and run with it. From a marketing point of view, one of the key aspects of taking this approach is having that business memory.”
When he leaves he will adjust roles to ensure different sections of the project are picked up. Adams adds: “I have got to the point where it needs to be fully embedded in the business rather than one person driving it. It is being built into the fabric and the processes are in place.”
Household appliances brand Electrolux has been working on its digital transformation with agency Prophet for the past two-and-a-half years with the aim of building brands in a more effective way. The project is long-term and still going.
Senior vice-president of EMEA marketing Lars Hygrell was upfront about being able to take the time to fully implement the project, having seen his predecessors in the role for just 18 to 24 months before they moved on.
“I said when I took this role you cannot achieve what is necessary in such a short period of time and I’m not interested in just taking a change agenda and this big responsibility if I cannot follow it through.”
He says: “I’ve been in the job five-and-a-half years, and we have gone through restructuring and now the digital transformation phase, [so] I hope to be able to actually fully implement that before we have any more discussions.”
Hygrell claims this consistency is working and that business results are “at an all-time high in EMEA”. He puts this down to sticking with a strategy for a “long time and driving it in the way it was intended”.
Short-term agency relationships
Short-term objectives are influencing the length of time brands work with agencies, often leading to agency changes every few years or the use of agencies for specific campaigns, with a subsequent effect on the clarity of messaging.
For Hygrell at Electrolux it depends on the project. He says: “When it comes to understanding the business and the holistic picture of what we are trying to do, I’m a little bit hesitant to change agencies too often and I like to stick with partners and agencies that understand the brand and are part of the real strategic discussions. I like to find agencies that can transform with you.”
However, he adds: “In terms of digital and marketing technology and implementing new consumer experience ideas on the shop floor or in the social space, we change agencies more frequently.”
The IPA’s Field says that “any shift towards a requirement to prove yourself in the short term undermines the motivation for long-term brand building”. He points out that agencies will be expected to deliver short-term results for their clients, but that the value they create is ultimately determined by the long-term effects of campaigns.
Yet as brands increasingly aim to create ‘disruptive’ business models, they are looking for faster turnaround of ideas and business concepts. Startup business BandWagon, which connects musicians with gigs, works with web design and product development agency Lighthouse on a project basis to allow for specific goals and cost-saving.
“Approaching agencies for project work on a short timeline allows us to set more specific goals,”
Stan McLeod, CEO, BandWagon
BandWagon CEO Stan McLeod says: “The way we operate sees us planning ahead carefully and setting specific targets for the next few months. Once we can see what the priorities are, we can then establish where we might be able to seek the help of agencies to reach our goals.”
He adds: “Approaching agencies for project work on a short timeline allows us to set more specific goals. This leads to more valuable measurement and evaluation. We can better understand not only if our targets were met, but how well they were met. Being able to drill down into bite-sized pieces of information helps us to plan for future projects.”
It is not just small brands that are looking to set agency goals on an ongoing basis. Confectionery giant Mondelēz International recently rolled out its ‘fly fearless’ model, which seeks to change the way it works with agencies on a global scale. Instead of collaborating with creative agencies for a prolonged period of time, Mondelēz works with creative agencies in 20-week bursts.
However, chopping and changing agencies might not work so well for campaigns with long-term objectives. Thinking back to his days at Aviva, Atom Bank’s head of marketing Neil Costello recalls how the brand pitched its global account again and “moved away from an asset that had been working well”. He adds: “To fuel brand awareness and consideration metrics that are required as you move from one asset to another, you would have to invest heavily.”
He is also of the opinion there is “still a position for those long-term campaigns, particularly if you are a big established brand and it’s a commoditised market”.
Whether the trend towards short-term metrics changes depends on companies taking steps to understand what function senior leaders need marketing to do: chasing immediate gains or facilitating longer-lead brand building. And CMOs will need to challenge chief financial officers and CEOs to put brand health above the next quarterly results.
Atom Bank’s CMO Lisa Wood will be speaking at the Festival of Marketing, which is running on 5 and 6 October at Tobacco Dock, London. For more information about the event, including how to book tickets, click here.