Let's face it: 2018 was a tough year for CMOs. According to a study by consultancy SpencerStewart, an alarming number of brands (across all verticals and industries) made a change to their top marketing position last year. The ripple effect of these personnel shifts can be felt by agency partners and internal teams alike, and could take months (if not quarters) to reconcile. This begs the question: Why were so many CMOs unsuccessful?
The answer is about as nuanced as the job of a modern CMO. With the growing emphasis on omnichannel marketing, it has become a position fraught with disparate, often competing priorities, demanding the ability to build strong but divergent teams. All this while staying on brand and on budget? A tall order, to say the least.
A recent Harvard Business Review article posits that the modern CMO facilitates growth for the business via four important levers: brand marketing; product, data and analytics; and sales support. Objectively, these categories make sense. The problem is, I believe it would take a unicorn CMO to truly excel at all four. The failure comes when they only pull the levers they are proficient at, leaving noticeable holes in business growth, product development or perceived value from their C-suite counterparts.
From my experience as founder and CEO of an outsourced CMO and marketing consultancy, I believe an outsourced model may be the solution to uncovering this mythical unicorn CMO. You might ask, "Why would I outsource one of the most important growth roles in my company?" It's a valid question. Let's dive a bit deeper into what I believe are some potential benefits:
Every brand has unique marketing needs. Some may require a full-time CMO, while others may simply need CMO-level analysis. Let's say a brand is having trouble understanding where and why prospects drop off during their customer journey: The CMO might be an expert in foundational brand messaging and brand awareness, but if he or she isn't adept in data analytics and conversion optimization, the problem could persist.
The flexibility of services that agencies offer means that this brand could remedy specific pain points by engaging outsourced experts with specific disciplines that address various needs.
Diversity of thought
Internal teams can grow insular, resulting in tunnel vision when it comes to brand growth. With so much focus on the way forward, in-house CMOs and marketing teams could fail to absorb the latest trends in the macro environment.
Because agencies service a variety of clients with unique needs, they must constantly stay on the bleeding edge of tools and techniques to retain their competitive advantage. And because their experts come from a variety of backgrounds, they can draw from a deeper well of expertise. Though brands will have a main point of contact when engaging an agency, they will gain access to a team of experts with complementary perspectives.
According to data from Glassdoor, the national average annual salary for a CMO is approximately $200,000. With benefits and bonuses, that number could easily inflate to $250,000-$300,000 in real costs. That's a hefty investment, especially in light of the shaky success rate. For some businesses, that figure could seem daunting, if not untouchable. Although the total cost of outsourcing varies due to a number of factors including agency, breadth of services required and length of contract, brands may be able to outsource CMO capabilities for less than the above figure.
But be warned
When looking for that outsourced CMO partner, businesses should beware of a few things. From my experience, I've seen agencies and so-called marketing gurus pose as CMO-level experts, when in fact the only thing they're good at is throwing around buzzwords. Decision makers should always research the reputation and track record of potential partners.
Additionally, agencies or consultants may try to lock clients into onerous agreements. Long-term contracts and high minimums essentially negate the flexibility and value benefits of an outsourced CMO solution.
Finally, these outsourced marketers sometimes don't focus on the full marketing mix. Agencies or consultants that specialize in only one small aspect of marketing (like paid acquisition or email marketing) without strategizing and executing on other channels are no better than that limited-scope in-house CMO we started with.
In short, neither the in-house nor outsourced CMO option is a one-size-fits-all method. There are pitfalls to each, and I've spent equal parts of my career as an in-house marketer for brands, as well as the leader of an integrated agency team of CMO-level strategists. It's tough to hand your marketing over to an unknown entity. Onboarding can be challenging, and change and transition are never easy. But it can also be a breath of fresh air. If your unicorn hunt isn't proving successful, consider whether a consultancy partner that can own brand management, data analytics, full-funnel strategy and business growth would fit your CMO needs most.