NEW YORK (AdAge.com) -- The Dow may be down, but things are looking up for CMOs.
Marketing chiefs are embracing new technology and doing a better job of synchronizing their departments' efforts with overall business goals, and as a consequence their tenure is increasing.
|Source: Spencer Stuart|
Greg Welch, who leads Spencer Stuart's consumer-goods and -services practice, said the figure is indicative of CMOs' better aligning with CEOs and understanding their objectives, better leveraging internal bench strength for ideas and innovation, and embracing new technology.
Even so, the CMO slot "is still the hottest seat in the C-suite," said Mr. Welch, and by "hottest" he doesn't mean cool. Despite the improvement, average CMO tenure still remains dreadfully short compared to that of other senior-level executives: The average tenure of chief financial officers at Fortune 1000 companies, for example, is more than four years, while CEOs log an average of six years. "This is still the function that is not only in the news a lot but is certainly turning far faster than any other."
Watching bottom line
But CMOs are clearly making strides, and Lee Applbaum, exec VP-CMO of RadioShack Corp., credits a keener eye on the bottom line. "The realities of this economy no doubt have reduced voluntary turnover, but, perhaps more important, I believe that the extended tenure is the result of a more strategic focus from CMOs around advertising and creative that is evaluated in more traditional financial terms like ROI [rather] than esoteric measurements such as consumer awareness and affinity," he said. Mr. Applbaum joined RadioShack four months ago; his background includes CMO posts at Schottenstein Stores Corp. and Federated Department Stores' David's Bridal Group.
"Today's CMOs are challenging not only themselves to be more disciplined, accountable marketers, but also their agency partners to think, for example, about creative that directly drives shareholder value versus just winning industry accolades and lofty awards," he said.
Elisabeth Charles, who starts a new post as CMO of Petco in mid-February, also credits analytics and measurable results for the increased tenure. "You see a lot more folks doing marketing ROI studies, using more direct marketing that can be measured and shows a payback, as well as really scrutinizing the balance of brand investment vs. traffic or sales driving initiatives.
"Another area that has improved but I think is still highly underleveraged is the use of consumer insights and database analytics," said Ms. Charles, who was most recently exec VP-marketing at Victoria's Secret. "Most of the companies I interviewed with for CMO roles mentioned that this area needed more focus and had huge upside."
The CMO role is being made tougher, though by the recession as well as rapid changes in media consumption. "We're no doubt seeing unparalleled increase in the cost of goods, global competition, and for marketers, there are new technologies in measuring the business and speaking with a splintered consumer group that make the science of marketing more and more challenging everyday," Mr. Welch said. "We can't get the marketing profession to all agree on what the most critical metrics are or should be."
So how to overcome the challenges? Now more than ever, companies need transparent, from-the-front leadership -- including that of CMOs, he said. CMO-CEO alignment is also critical. "In difficult times missions within companies can change, and in order to protect yourself, you've got to continually do that check-in," he said. "The good ones seem to do that very well."
"A lot of it has to do with the economic environment," said Dick's Sporting Goods Exec VP-CMO Jeff Hennion of what CMOs need to do to extend their tenure. "We are all being challenged to keep doing everything we're doing and delivering results with less. And the environment has really moved to be about what are the most efficient things to deliver ROI," said Mr. Hennion, who has been in his CMO post at Dick's for four years. "You really need to know the things that are going to work."
Successful CMOs also tap outside and inside expertise. "In a market like this, it is a great time to embrace both vendors and customers and let them help with the business. Now is not the time to give the agency concern about their longevity of relationships. Now is a great time to sit down and get close to your partners. Ideas can come from anywhere," including, Mr. Welch said, employees.
"There is a different generation out there that not every more seasoned leader is in tune with. I suspect there are some fabulous ideas that could be unearthed from these younger marketers in marketing organizations. The great CMO figures out how you get to those ideas."
Five ways CMOs can extend their tenure from Spencer Stuart's Greg Welch
- Lead from the front. In times like these, your team members want (and need) to see and hear from you. Regardless of the forum, you need to continually reassure your team of the broader mission, your progress to date and, to the best of your ability, your plans for the future. Obviously, honest and authentic leadership works best.
- Be a translator. Now is not the time to shut your door to others -- whether business-unit leaders or functional peers such as the chief financial officer or chief information officer. Explain your agenda and determine how you can together deliver tangible business value. Inspire trust and build bridges across the company. You need everyone's support. The CMO is a great platform from which to lead, so take advantage of it.
- Tap into the inherent wisdom of your organization. When it comes to innovation, keep your eyes and ears open, as the next big idea may surface from a more junior employee, a peer, your agency or even a customer. Create an environment where innovative thinking is the mandate, and don't allow "business as usual" to exist. Today's top CMOs are always looking for new thinking, and they embrace others' ideas, whether they be around new products, analytics or media.
- Continually knock on the CEO's door. Consistently check in with your boss and ask for a candid assessment of how you are doing. This will ensure you share the same vision for your role and the overall marketing team.
- Don't be afraid to take calculated risks. This is the "Measure twice, cut once" principle. That said, great CMOs take action.