The sporting universe never lacks for metaphors to describe business, especially when the FIFA World Cup is under way. And as Erich Joachimsthaler, chief executive of consultancy Vivaldi Partners and author of the book Hidden in Plain Sight pointed out to Bloomberg last week, the philosophy of football proves a good analogy for the way companies and marketing departments need to be run.
Whereas marketing strategies of old were carried out in the style of an American football game, today’s digital consumers demand an approach more like the type of football the rest of the world prefers. As Joachimsthaler puts it: “In American football, you stop the play, you plan, you evaluate, then you execute the play and you stop the clock again. It’s stop and go. In European football, you play all the time and you need to manage the situation all the time.”
It is not only in the always-on nature of the game where the similarities lie – it is also in the way the responsibilities of marketers need to be structured. In companies of old, a chief marketing officer (CMO), like a quarterback, could take time to direct the play with frequent breaks for input from the sidelines.
But today’s marketing teams must be organised in a more fluid formation, argues Joachimsthaler. Players, or marketers, need to be able to adapt to new roles as the situation demands, with this being dictated more by the consumer than the CMO. The upshot is that the CMO of old, who had control of the brand’s communications in all its channels, is obsolete.
The question this poses is how marketing departments go about building their new teams and communicating what they can do – or ‘marketing’ their new proposition (see below) – within their organisations. Lysa Hardy, CMO of Holland & Barrett owner NBTY, says that marketers first need to overcome the barrier that few organisations can agree what role marketing directors or CMOs fulfil.
“The first job the marketing team needs to do is to be clear about what it is responsible for. In some businesses it is focused on communications and advertising, in others there is full profit-and-loss accountability.”
Bupa marketing and strategy director Saj Arshad agrees that the marketers perhaps have themselves to blame for being on the back foot in their efforts to be seen as nimble, customer-focused and commercially minded. “As a professional body, we have allowed ourselves to be positioned as the colouring-in department, which is symptomatic of the fact that we have not grown commercial marketers. We get excited by the creative element and that’s a mile away from being in the commercial cut and thrust.”
Selling marketing to the business is clearly more than begging for ad budget, but how do marketers articulate what they do in terms that everyone can understand? More importantly, how can they also do it in a way that allows them to become an equal partner in driving the strategy and direction of the business?
As the industry has watched marketing’s accountability to the board evolve, the trend has grown for marketers not only to be accountable for spend but also to talk to other board members such as the chief operating officer and chief financial officer, as well as the chief executive, in terms that they can understand. Arshad says that to be recognised for their contribution to strategic direction CMOs must first and foremost deliver the narrative of the customer.
“Marketing’s absolute strength is that it is the voice of the customer in the business. Let’s not have an executional debate. Do we understand what sort of thing makes the customer more favourable towards us?,” asks HSBC global head of marketing Chris Clark.
Bupa’s Arshad elaborates: “If you as the marketing director can harvest powerful insights about how customers feel about your brand, then there’s no-one in your industry who will be uninterested in that narrative.”
Setting strategic agendas
Marketing’s unique position to understand the customer leads to the imperative to translate that for the rest of the organisation – not necessarily boiled down to numbers on a balance sheet but in simple terms that will resonate with everyone, regardless of function or level of seniority.
“Just as I wouldn’t engage my customers in a complex conversation around data, it’s about how I frame what I am doing for my internal customers,” says NBTY’s Hardy. “Marketers often get technical around customer relationship management and insight but I don’t expect finance to get technical with me about accountancy. Many talk about brand perception and positioning in creative ways but don’t say why something is important and what it will deliver. Just bring it back to the customer and show the value generated in what you have done.”
Camelot marketing director Sally Cowdry says: “If you can focus on being the voice of the customer and articulate this in plain English, you can help set the strategic agenda and develop an end-to-end customer experience that drives competitive advantage. Camelot’s core purpose is to change lives: if an organisation has a clear purpose that goes beyond the product proposition, then everyone internally will be driving towards that on behalf of customers and shareholders.”
Although the CMO might no longer have the ‘quarterback’ role of controlling all communication channels, the leadership element of the CMO’s job is to demonstrate value creation from the customer point of view and develop a compelling customer strategy. Cowdry acknowledges that it will be difficult for CMOs to make this case if the board does not buy into this vision of marketing.
Arshad adds: “If the CEO doesn’t get this, you are wasting your time. If making money for the shareholders is the core belief, as a marketer you will fight an uphill battle to turn it around into a customer-led organisation.”
The CMOs interviewed for this article all claim to be working in organisations that recognise marketing’s strategic role, founded on a ‘customer first’ mentality. But they also note that this is only half the battle. Marketers seeking to set the agenda also have to demonstrate how their strategic aims translate into delivery. To do so, they need to understand the business’s commercial imperatives, manage the risks inherent in marketing activity, and have an ongoing and evolving discussion with the entire organisation.
Arshad believes commercial intelligence and numeracy are critical skills in even young, newly-minted marketers. “You have to acquire the ‘down and dirty’ profit-and-loss accountability to be credible. As a Marketing Academy mentor [a scheme giving young marketers careers advice], I cannot emphasise enough that they need to get commercial experience at the early point of their careers if we are to change marketing’s dynamic.“
NBTY’s Hardy adds: “I can guarantee every chief financial officer changes their perception of marketing the minute you start delivering value.”
Accountability is easier to deliver today through myriad digital channels that do not just provide proof of concept within digital but extend to justifying offline activity too, through the ability to track customer behaviour. While marketing can be increasingly accountable, it will never be possible to account for 100 per cent of expenditure. This is where marketers need to work on the cultural perception of the discipline even more.
“Marketing is perpetually in beta. You have to have a risk management approach to it and its expenditure because it’s not a perfect science,” insists HSBC’s Clark.
Bupa’s Arshad adds: “If I just pitched up at the board and talked in wishy-washy marketing terms, I wouldn’t get far. But on the other hand if I can give econometric evidence that every time a TV ad is shown it generates X leads, it’s a simple conversation. Although there is always the affordability question, this allows me to explicitly agree a growth fund for good ideas that doesn’t need to be justified by return on investment.”
For Clark, it means managing the expectations of the rest of the business, including introducing the board to the concept of being comfortable with risk. Being able to sell in the element of risk is not just important in helping the brand answer the customer proposition, but is also necessary to give marketers the confidence to do their jobs.
“Use the consumer and trends to help your business see the opportunities they have and then be robust enough to understand that any criticism or failure has to be taken on the chin. To feel OK about that, in some business cultures, is difficult to ask for. But you will have a better night’s sleep if you can ask for it. Colleagues don’t feel a level of insecurity where they have to defend the indefensible,” says Clark.
But by going back to Hardy’s insistence on value creation and Cowdry’s point that the organisation cannot ignore a strategy that is driven from the customer point of view, marketers can still demonstrate the importance of the ‘unknown quantity’ of marketing spend whose returns are not visible. HSBC estimates this to represent 15 per cent of the overall budget.
“If you can speak the finance director’s language, then they know that you come at this through a sensible lens and so there is no debate over the need for a ‘growth fund’,” Arshad notes. He adds that one such example is Bupa’s Groundmiles app – a free smartphone app to log steps walked, based on the medical insurer’s ‘Walking for Health’ proposition. It includes a viral video that Arshad admits only half the organisation liked, however Bupa sees the app as being successful, despite there being “no ROI”.
He says: “It’s a bit of fun and we shouldn’t take ourselves too seriously.”
It is these elements that Clark agrees make up the intangible but no less vital elements of brand building that marketers will gain buy-in for. “Being a desirable organisation means my graduate recruitment is more efficient. Marketing has had a role to play in this but we can’t say what that is worth to the business. I can’t metric ‘feeling good’ but I know that my staff work better because of it,” he notes.
Staff are the ultimate proof of whether marketing has managed to market itself properly to the organisation. They, after all, are on the front line delivering the ideas thought up by senior managers and executives.
“You have to listen to the front line, synthesise their feedback and create the narrative for the business,” says Arshad. “Then encourage the teams to participate rather than dream up new propositions in isolation. I have always found the best ideas for new propositions come from front line staff. A good team leader in a call centre will tell you if a concept will fly or not. You can save lots of time, pain and theorising by just talking to people.”
Chief marketing officer
NBTY Europe (owner of Holland and Barrett)
How marketers apply the four Ps of marketing internally:
Product – what does marketing do for the business?
It is important to change the perception of the fluffy brand person. You change that by demonstrating what you’re doing. Many talk about brand perception and positioning in creative ways but they don’t say why that is important and what it will deliver. If you bring it back to the customer, you can’t go far wrong. Everyone identifies with the customer.
Price – what does the marketing department cost the business?
It’s about getting the chief financial officer to see marketing not in terms of price, or cost, but in investment in the business. When I joined Holland & Barrett a year and a half ago I had a sceptical chief financial officer. I reframed how I communicated marketing to show what the value was in what we did and now our budget conversations are very different, to the extent that the company wants to put more money into marketing.
Place – which areas of the business are responsible for marketing?
Everyone in the business is the marketer, particularly in retail where if you’re not on the front line serving the customer, you’re serving someone who is. I need everyone in the business to understand who the customer is and what we’re trying to be and then to play their part in that.
Positioning – where does the marketing function sit in the business?
It is important to make it easy to understand what we do. I introduced a strong feedback loop on customer insight so it goes back into the business and people can understand what we’re doing in terms of delivering to customers. Someone in procurement or distribution can then understand and make the right decisions. The fact that we put ads on TV is just the day job.
Top three tips to marketing internally
1. It’s the leadership role to continually anchor the organisation in customer learning and build a core purpose from that. If employees, regardless of department, have a clear purpose that goes beyond the product proposition, then everyone will be driving towards that.”
Sally Cowdry, marketing director, Camelot
2. “If you’re going to change the marketing dynamic in companies, then the next generation of marketers need to get commercial experience early in their careers otherwise it’s too late. Commercial credibility comes from running the P&L [profit-and-loss account] early on.”
Saj Arshad, marketing and strategy director, Bupa
3. “Own the right to represent the customer and poke your nose into every part of the business. Too often I see teams waiting for permission to be invited to discussions. Challenging the business to get into conversations that are outside strictly marketing-based silos will break down perceptions.”
Lysa Hardy, chief marketing officer, NBTY Europe.