What CEOs demand from marketers
The relationship between a CEO and marketing department is not always an easy one.
“All business failures are fundamentally marketing failures,” says Martin Glenn, CEO at United Biscuits.
It is an unforgiving attitude and one that must instil fear in his marketing team, but as Glenn is a former marketer, it is a view founded on experience. “Successful marketers must have a customer disposition, be able to translate consumer signals into a company’s language and be courageous enough to push through change, because change is rarely welcomed,” he says.
But the relationship between marketers and their bosses is not always harmonious. Last week, Northern & Shell communications director Mimi Turner quit her post after reportedly clashing with owner Richard Desmond. There are probably many more conflicts that never make the headlines, given that an often cited 2012 study by Fournaise Marketing Group found 70% of CEOs have lost trust in their marketers’ ability to deliver growth.
So what is it that CEOs want from their marketing departments and how can marketers ensure they meet these objectives while delivering what is best for the business?
“You have to keep looking for new ways of doing things; it’s rare these days that you can do the same thing twice,” says Beatrice Lafon, group CEO at global accessories retailer Claire’s. But while innovation has always been important, she says it has to happen at a much faster pace now to keep up with customer demands, and therefore requires a style of management that is hinged on “honesty, openness and the ability to question everything we do”.
However, innovation is not as simple as it seems. As Marketing Week reported in September, a recent study by Promise Communispace reveals that 39% of marketers admit their business does not have a clear innovation strategy and a quarter believe it is a term used without any real definition.
As a result, Kevin Beatty, CEO at Daily Mail and MailOnline publisher DMG Media, believes the need to innovate usually results in “perspiration rather than inspiration”. To enable marketers to understand customers “more specifically” the business launched the MyMail portal, which combines customer data across all its products.
“With the data, we aim to leverage the technology available to understand the efficacy of what we do, but more importantly we are trying to use the trust and engagement levels that we have with those millions of customers,” he says. DMG Media claims to reach 59% of UK adults and MailOnline had 180 million unique users globally in August, according to the Audit Bureau of Circulations.
However, United Biscuits’ Glenn argues that it is not enough for marketers only to be the consumer’s voice. “Companies exist to make money so marketers have to be able to translate that effectively in terms of business cases, future cash flows and justifying capital expenditure,” he says. He concedes that a CEO who is purely financially orientated in the short term will not be a great counterpart for a marketer “because they are about investment, albeit with a return, so in that scenario it can be difficult”.
“Marketers must have courage to push through change, even when the chips are down”
Martin Glenn, United Biscuits
When he joined United Biscuits in April 2013, Glenn says he was given permission to rewrite the company’s three-year business plan, which led to a rise in company spending. In order to get people on-side he had to speak the language of the boardroom and illustrate how these increased investments could improve the short- and long-term worth of the business.
“It was important to do that otherwise I would just be another CEO with a marketing background saying we should spend more money on equipment and advertising. The fact we could show profits growing in that situation to make it seem like a good return on investment was critical,” he explains.
It is these lessons that marketers need to take on board, says Glenn. According to United Biscuits’ company statement for the first half of 2014, it invested £12m in marketing the McVitie’s brand in the period, growing global sales by 5%. It also invested £10m in advertising for Jacob’s, leading to an increase in UK market share. In 2013, sales across the business grew but profits fell.
At charity Macmillan Cancer Support, former marketer and interim CEO Lynda Thomas says a clear business case must be presented, as investment in marketing is hard won. “We have to be sure that this is the best use of money that could be put to many different uses, not least providing frontline services to people affected by cancer. For this reason I expect a strong business case that clearly demonstrates how the objectives and targets will be met, whether they’re about generating money, reach or influence.”
Macmillan spent £18m on campaigning in 2013, 10% of its overall expenditure, compared with £15.3m in 2012, which was 9% of that year’s total.
For next year, animal charity Dogs Trust has set a target of raising £80m, a 6% rise on last year. To reach this goal CEO Clarissa Baldwin says 30% of its overall budget will be dedicated to marketing. The amount changes each year depending on whether the focus is on raising funds or building new rehoming centres but “a large percentage will always go to marketing”, she adds. Baldwin is retiring at the end of the month after 40 years and former marketing director Adrian Burder, a 20-year veteran of the trust, will take over (see The path from marketer to CEO, below).
While the CEO and CMO should be aligned on the overall business strategy, seeing eye to eye on everything is not a necessity, says United Biscuits’ Glenn. Rather it is open and frank discussions that move things forward. “I disagree with lots of people about what should be done but we normally end up in a good place because better outcomes occur through discussion,” he says.
Typically, his arguments with CMOs tend to be on the scale of their ambition and how integrated their thinking is with the rest of the business, so he will always probe to get answers. Similarly, Claire’s Lafon asks a lot of questions and admits it is not unusual for her to enter a meeting with one opinion and leave with another.
“I try not to wear my opinion on my sleeve so people can’t second-guess what I’m thinking. I might not always agree with what they want to do but if I get the feeling they are attached to an idea, we give it a go,“ she says. “I don’t mind things that don’t work; what I’m looking for is the ability to recover and to ensure that we don’t make the same mistake twice.” While she accepts that the buck stops with her, she believes employees cannot develop if they don’t feel empowered.
Robert Ettinger, chief executive at luxury leather goods brand Ettinger, believes giving the marketing team scope to get on with things builds confidence and means they are more invested in the business. “People have more interest in what they are doing and tend to do a better job,” he says. “If it goes wrong, they know it’s their problem and therefore things don’t tend to go wrong.”
Harvey Ainley, CEO at Transform Cosmetic Surgery, is also a strong believer in empowering people to make decisions. “While I take an active interest in our marketing activity, I try not to be overlyanalytical and get in the way of my marketing director too much,” he says. “When you lead a business it’s important to trust people to do what they are expert at.”
Conversely, Joe Middleton, founder and chairman of sportswear brand PlayerLayer and former president of Levi Strauss Europe, admits that if he had to decide between an autocratic or democratic style of management, he would choose the former. “I get heavily involved. I can be quite dictatorial, directional, controlling and detail-orientated but I recognise that way of behaving and I know I shouldn’t be like that all the time. I would like to think there are also times when I leave the team alone.”
He believes marketers need to display both attitudes at different times for different situations in what he calls a “schizophrenic” approach to marketing. “Some marketers sit in their tower with a telescope and look out – that’s the dictatorial way. While empathetic marketers go outside, put themselves in the shoes of the consumer and look into the company through their eyes.”
Having worked at large and small businesses, Middleton believes there are lessons that each should take from the other. “Big companies don’t make brave decisions,” he contends. “When they reach a certain size, they become politically correct and the default mode is ‘let’s be democratic, do market research and listen to the customer’, which means you converge towards the norm.”
Equally, he believes small businesses should take note of how large organisations communicate their brand proposition internally to ensure everyone, but particularly the marketing team, is on the same page. “At Levi’s, we had a one-page document, which outlined what the Levi’s brand is about. It meant that people from Manila to Manchester knew what the guys at the head office in San Francisco were thinking. It was the first thing I did at PlayerLayer and it is the first document any new employee receives,” he says.
Keeping up with changes in technology and the rapid development of new communications channels poses the biggest challenge for businesses today, suggests Transform’s Ainley. “Driving customer acquisition, satisfaction and loyalty is complex. Ensuring that the quality of the interaction is equally effective across all channels and that your brand is presented consistently are not easy tasks,” he says.
He supports the marketing team by giving them as much notice as possible about future business strategy so that they can build this into future campaigns. “It is vital that I communicate to them what we are trying to achieve, otherwise I would be asking them to do a job with one hand behind their back,” he adds.
Claire’s Lafon believes it is the marketing team’s role to have their fingers on the pulse of new technology, particularly as she admits not all areas of communication come naturally to her. “Social media is an important channel for us and our customers but I was not brought up with it. On a personal level, I have zero interest in social media so I really have to make an effort to keep abreast of how it is evolving,” she adds.
While marketers face obvious difficulties – notably ingrained scepticism about their commercial sense – United Biscuits’ Glenn does not believe it is any more difficult to be a marketer today than it used to be. However, he urges marketers to ensure they do not get lost in their own bubble of brand equity, development and
“Marketers have got to be seen to be driving the company agenda front and centre with all the other functions,” he adds. “Therefore, CMOs have got to make sure they get taken very seriously.”
The path from marketer to CEO
The greatest quality a CEO must possess is the ability to inspire, according to Claire’s group CEO Beatrice Lafon. Anyone from any background can become a CEO, but to do the best job they must understand all areas of business, she says.
It was this ambition that enabled Max Pogliani, CEO of mobile phone brand Vertu, to progress up the ladder. “I moved from CMO to CEO because I embraced opportunities to do things beyond my job title. When I moved to CEO I had a good idea of what was going on in the rest of the company.”
United Biscuits CEO Martin Glenn, another former marketer, says the reason it is difficult for marketers to move into a CEO role is because many companies are organised pan-regionally and globally, which means the marketing function has been split into divisions of labour according to specialist disciplines.
At Macmillan Cancer Support, interim CEO and former marketer Lynda Thomas says the sector‘s view that a CEO must have a background in the core business of the charity is changing. She says: “We’ll only survive if we know our customers inside and out, and continually develop ways of engaging with them using digital channels.” Because of this, it puts marketing directors in a stronger position to become the CEOs of the future, she adds.
CEOs’ expectations of their marketers
Beatrice Lafon, group CEO, Claire’s
“I look for openness, honesty and pace, as well as courage and boldness. Consumers have changed since the recession, so it is more difficult to predict what they want. Marketers must have deep customer insight – not just who they are but what they want, what makes them tick, what they are influenced by and how they make their decisions.”
Martin Glenn, CEO, United Biscuits
“Marketers are central to growing the business and it is their role to translate outside influences into something that is practical for the business to respond to. In addition to that they must have a customer’s disposition, be able to speak the language of the boardroom and have the courage to force through change, even when the chips are down.”
Joe Middleton, chairman, PlayerLayer
“I don’t want marketers who are only good at listening to market research, but I also don’t want wild, power-hungry maniacs. I want people that can operate in both modes – marketing schizophrenics, if you like. ”
Harvey Ainley, CEO, Transform Cosmetic Surgery
“It’s crucial that marketers have a good understanding of what drives our business and what is important to our patients. It’s a very personal and sensitive industry so they need to have a good feel for what is and isn’t appropriate.”
Trynka Shineman, president, Vistaprint
“The essence of a great marketer is someone who is passionate about customers and focused on really understanding their needs. They must be a strong leader who can head up large and integrated teams and they need to be able to balance short-term and long-term goals to drive the best results.”
Max Pogliani, CEO, Vertu
“All marketing directors are convinced that they are delivering what the customer wants, but in fact they often put a lot of themselves into what they are doing. I want marketers always to think about the customer first, rather than what they would do in a particular situation.”