The List launches ‘The Modern CMO Playbook,’ a marketing game plan for the future

Change is the only true constant in the world of marketing and advertising. Informed by societal norms, technological tools and rising new generations of consumers and industry professionals, ever-fluctuating market realities set the standards of expectation for how brands should behave internally and externally. 

The tip of the spear in this challenging landscape is usually the chief marketing officer, a role that has evolved in value and responsibility alongside the traditional priorities of the position. Traditionally, CMOs need a sharp eye for the qualitative side of business, encompassing consumer psychology, design and attention-grabbing ideas. But contemporary realities are making the CMO’s job that much more complex.

The List, the collective of leading marketers and advertisers assembled annually by Ad Age in partnership with Meta since 2019, has resolved to address the most pressing issues facing the advertising industry and proving that marketing and creativity can drive growth for brands during a down economy by launching “The Modern CMO Playbook.” Publishing monthly on Ad Age’s Publishing Partner platform and The List’s vertical, the thought leadership series will be a living document leveraging the expertise of List members past and present to offer top-line industry observations, challenges and solutions to aid leaders in articulating the realities of the market along with actionable recommendations for managing a changing landscape. 

“We’re excited to continue our important work with Ad Age and The List for the fifth consecutive year,” said Sylvia Zhou, head of global industry marketing at Meta. “We believe deeply in the power of connections in fostering opportunities, driving growth and facilitating positive change. This program has been unique in the industry in the sense that these leaders are building an evolving community, resource and destination for all advertising and marketing professionals.” 

A culture of change

Over several decades the CMO role has been transformed both culturally and tactically. Brand visibility and favorability, thought leadership and demand generation have become priorities during the digital media boom, while media fragmentation altered KPIs and measurements of success. This has created the need for new skills, as big data revolutionized brand and performance assessment. 

While digital media provided access to more detailed consumer insights, it also introduced vanity metrics—statistics that look spectacular on the surface but don’t necessarily correlate to such business results as customer acquisition, revenue and profit. The 2010s were an era of disruption in which 4G technology empowered on-the-go consumption via streaming, e-commerce and social media. Businesses sprinted to adapt as time spent online via mobile jumped by 300% between 2011 and 2019, and global social media use increased from 970 million to 2.96 billion from 2010 to 2020, according to NASDAQ. This came with an evolution of performance metrics many were learning and comprehending in real time. 

“The shift was evident for some brands and agencies who previously marked success by having one $2 million TV Super Bowl spot that could win a Cannes Lions and be repurposed throughout the year. Suddenly, they were creating more content in addition to the one spot but without a clear ROI goal or ‘why,’” said List member Obele Brown-West, president of Tracer.

Just as VCs poured billions into finding the next Uber or Instagram, advertisers poured billions into capturing audience engagement across social media and search engines. By 2019, digital advertising spending surpassed TV and radio. Many business and marketing leaders used vanity metrics regarding audience reach, viewership, subscriptions, etc. to justify increased funding and spending without quantifying how awareness dovetails with bottom-line impact. 

“Too frequently, we saw top-of-funnel metrics justify increased budgets, without corresponding rigor on downstream impact of ROI and how the funnel converts,” said List member Megan Cameron, senior VP and retail media practice lead at Merkle. “Waste in digital media was high. Brands felt it in weak bottom-line KPIs and consumers felt it in uncoordinated and oversaturated advertising experiences.”

“Vanity metrics offer a quick and easy answer for businesses,” added List member Judith Carr-Rodriguez, CEO and partner of Fig. “People are programmed to feel reassured when there is a quantified number to lean on, but this number actually creates a shallow perception of success. It is a short-term box tick, and we need to look beyond it to measure actual impact.”

The challenge of trust

Brands leverage mass media to communicate purpose and promises regarding social responsibility, data security and more. Further, 60% of consumers say trustworthiness and transparency are the most important traits of a brand. Yet there is a glaring gap between the trust consumers have in companies (30%) and the trust business leaders think consumers have in their organizations (87%)

In a world in which the term “fake news” has become weaponized to sow doubt about even trusted journalism institutions, it’s not far-fetched to connect audience distrust of news media to fragile trust in brands. By 2020, 66% of Americans said they didn’t trust mass media ”very much” or “at all.” 

These factors shape a challenging new reality for CMOs, exacerbated by the pandemic and elevated corporate social responsibility expectations, all wrapped in a not-so-neatly-tied bow of economic strain. The modern CMO is tasked with navigating economic uncertainty in a highly visible role, with a fraction of the budget and double the expectations as before, and in a climate that demands near-perfection in nuanced cultural communication and engagement. 

In an environment where shortened tenure (see below) has become so commonplace that “fractional CMOs”—i.e., temporary CMOs for hire—have gained in popularity, there is a perception among many marketing chiefs that their agency partners may not appreciate the personal risks the CMOs take. What's more, that risk is usually imbalanced, with the CMOs assuming the bulk of the responsibility and blame.

A real-world example of just one of the high-profile hazards that seem to be part of the job description these days: After one brand CMO took a highly visible creative risk and sales dropped almost immediately, the CMO was fired. Despite the fact that this creative risk was undertaken with the full endorsement of the CEO and the board, the CMO was the only person at the brand who was fired.

“I was under enormous pressure to deliver revenue growth and business results—as well as take creative risks,” the CMO told The List. “Imagine what it’s like to be in the Wall Street Journal because of the idea you got fired for. Meanwhile, not only were our agency partners not fired; they were celebrated for their ‘highly creative’ work.”

“We all know that in today’s world, people are feeling more anxious, worried and vulnerable. That extends to marketers too, and I think it has to change how agencies approach building trusted relationships with CMOs,” said Carr-Rodriguez. “Agencies’ role, more than ever before, is to provide the confidence for clients to make decisions for the long term, to have their back personally and professionally and approach all conversations with a big dollop of empathy for what’s going on for them.” 

Starting next month, each installment of “The Modern CMO Playbook” will offer deep dives on three pillars that address major industry disruptors right now and in the years ahead: navigating a high-risk era, the business case for DE&I and facing the future. 

Navigating a high-risk era 

“Imagine wearing the hats of chief revenue, creative, supply chain, brand safety, technology, information and public relations officer all in one.” said List member W. Joe DeMiero, U.S. CEO of Universal McCann. “It’s exactly as difficult as it sounds, creating a tension that persists no matter the global stature of the brand or size of the yearly bonus. How can the modern CMO successfully operate with business, social and operational pressures coming from all sides?” 

Marketers are tasked with reaching short-term business goals while ensuring brand safety, often leading to shorter tenures. According to Spencer Stuart’s annual CMO Tenure Study, CMOs at the top 100 advertisers in the U.S. had been in role for just 39 months, the lowest level in more than a decade. This revolving door of marketing leadership can create a potential culture of discontinuity and a disruption of long-term brand purpose. 

CMOs must manage expectations with their C-suite counterparts, to develop scalable strategies that serve short and midterm business priorities, together with long-term brand purpose. Then they can manage the activation and maintenance of that strategy across teams.

Meanwhile, brands prioritized content quantity over quality, becoming publishers themselves, and with content becoming a key driver of the marketing funnel. Branded content grew to a market value of $20 billion by 2021, while generating 22 times more engagement than display ads.

It’s becoming clear that “the path to success here lies in accurately diagnosing rapidly changing circumstances that influence a brand’s position in the marketplace,” said DeMiero. “Marketing leaders can approach this goal by leveraging data to negotiate and align with key stakeholders, from the CEO to agency partners, around the expectations of driving short-term and long-term success. It’s also necessary to understand what CMOs can take responsibility for and what they cannot.”

In addition, it’s necessary to allocate resources to the process. “CMOs must work toward integrating marketing into other functions in the organization, rethinking structures and information flow and connecting scattered data points through platform integration, all to get a unified view of outcomes that are easily accessible,” said List member Priyanka Rathore, senior manager, marketing strategy-retail experience at The Walt Disney Co.

Though these steps may seem fundamental, it’s imperative to take into account how quickly the essentials get lost in the process of navigating through ambiguity and complexity.

The business case for DE&I

The age of the content boom has been accompanied by a lack of diverse perspective and representation in mass marketing. This may have resulted in interagency teams being ill equipped for collaboration and afraid to offend. Socioeconomic instability has made reactionary marketing the new standard, which is bad for business since a not inconsiderably large segment of the consumer market values socially responsible brands.

However, under-indexing on diverse perspectives and solutions, while over-indexing on branded content and messaging, has created a culture of consumer distrust. Simultaneously, consumers grew to expect more social awareness and responsibility; 62% of consumers wanted companies to take a social stance, prompting a reactive marketing culture where brands rushed to be socially active. 

In response, business leaders must make necessary shifts internally to reflect the modern market in ways that will inform the creation of trustworthy media and solutions. In order to drive meaningful engagement with increasingly niche consumer communities. 

“Shifting diversity from an additive to a core part of the business process leads to tangible results,” said List member Michael Roca, executive director of Elevate, Omnicom Media Group’s multicultural marketing advisory unit. In fact, companies with more diverse workforces earn 2.5 times higher cash flow per employee. 

The business case for DE&I is not limited to diversity internally; it’s also related to diversity in ad spend. Ad spend in diverse-owned and multicultural and inclusive (MC&I) targeted media has tripled to $630 million between 2020 and 2022. However, the percentage of allocation remains minute at 1.2% of total national ad spend, according to the Alliance for Inclusive & Multicultural Marketing.

Many organizations point to growth in environmental and social governance (ESG) efforts but fail to acknowledge that DE&I commitments specifically have disproportionately been cut in the name of profitability and in the face of social and political controversy. While funds devoted to ESG grew by over 500% between 2018 and 2022—with a majority of it being driven by a focus on environmental change and humanitarian efforts—hiring of chief DE&I officer positions decreased by 66% during the same time frame. Since then, attrition for DE&I roles has outpaced other types of roles by over 30% at over 600 U.S. companies. 

It’s not surprising, then, that about 90% of institutional investors don’t trust companies to achieve their stated sustainability, ESG or DE&I commitments.

There’s an opportunity here for CMOs to leverage perspectives from internal team members and external partners across a diverse range of races, ethnicities, genders and sexual orientation. This truth may not be recognized by business leaders who may view sustainability as a distraction from profit-generating corporate strategy. 

Facing the future

The business case for DE&I can also be made based on U.S. multicultural profiles. American consumers now make up 42% of the population, and by 2042 the country is on pace to become majority multicultural. However, marketing teams lack the diversity themselves to serve the modern market. Among agency CEOs, owners and C-suite employees, 73% identified as white in 2021, and in 2022, that number jumped sharply to 90%. Meanwhile, 81% of public relations specialists are white, and publishers and talent are 76% and 72% white, respectively. Perhaps not coincidentally, 42% of Americans want to see more racial diversity in advertising.

Companies must learn from the past and optimize with leadership and teams that can build brands that align with the future of the consumer market. That means fostering multicultural and multigenerational collaboration that serves long-term brand value through thoughtful integrated marketing. In a brand to consumer relationship driven by content, this level of intentionality helps inform higher quality in communication. 

“Consumers are oversaturated with brand communication,” said The List’s Brown-West. “Content is a necessary part of marketing, but the current problem is the unchecked quantity of content being shared. The volume game led to misses in ensuring the diversity of thought, thoughtful integration with media and analytics, and forgetting not all content ideas fit all brand DNA.”

Next-generation marketers—and next-generation consumers—want to see change. Trends and the best practices that serve them come from the youth, further defining the market. Wise leaders will seek to polish and incorporate their recommendations. 

While the metaverse, cryptocurrency and NFTs have fallen prey to the hype machine and generative AI has generated as much fear of the future as hope for its possibilities, technology will play a major role in helping leaders analyze bias, spot inefficiencies and implement processes that will help avoid repeating the mistakes that went into building web 2.0. Web3 capabilities stand to revolutionize decision-making from talent recruitment to collaboration and execution through the power of transparency, autonomy, accountability and security. 

For the latest updates on how members are spreading the message about “The Modern CMO Playbook,” follow The List on Instagram (and Threads), Facebook, LinkedIn and X (formerly Twitter).