In June 2015, Marketo commissioned a study to identify the emerging trends CMOs felt will significantly impacted their future. B2B and B2B2C Chief Marketing Officers (CMOs) were qualitatively interviewed from companies ranging in size from the Fortune 10 to early stage start-ups.
As CMOs look forward, five emerging trends are shaping their marketing strategy and teams:
Customer Co-Created Marketing
It can be said that the ‘age of the customer’ is maturing. An increasing number of CMOs have surrendered to the fact that the buyer is in full control of vendor relationships, not just of the purchase cycle. The result is the rise of customer-dictated marketing.
Customers will not just dictate how vendor digital properties should function but also their expectations of content, products, marketing programs, sales methodology and customer-facing processes. Brands that listen and open their four walls will see customers even influence their cultures. One can see the seeds of this trend today in the rise of storytelling and how customers engage, or not, with brands. This trend is a core driver of other emerging trends and has far reaching implications beyond just marketers. Companies must learn how to surrender yet capitalize on their customers’ desires if they expect to survive.
Surrendering to customers and adopting a co-creation approach to marketing that intimately involves the customer is a path forward. It enables marketers an effective approach to understanding how, when and with what to build enduring customers relationships. Supported by deep data analysis, modeling, and hyper-personalization brands will be able to build credibility and trust by treating each customer as an individual, on their terms, at scale.
Darwinism of Marketing Organizations
In this environment of volatility and velocity, traditional marketing organization structures are too rigid and stifling to support the internal and external expectations of the function. CMOs are finding they and their teams lack key new competencies especially in areas where technology what thought to be an effective compensator.
The accelerated adoption of social and digital engagement, criticality to revenue of consistent value-based customer experience, shift to visual story-messaging, hyper-personalized user generated content, real-time data-driven pattern recognition, and heightened revenue accountability demands a change in how marketing works.
A significant portion of CMOs are in-sourcing new and traditional competencies ranging from data scientists and behaviorists to videographers, media relations and recruiting. Three drivers fueling this turnaround after decades of out-sourcing are: Need for super-agility, deep in-house customer understanding, and the inability of agencies to be true sources of innovation at competitive prices.
To gain more agility CMOs are organizing their teams less along functional reporting lines and more around the competencies of their employees. They are achieving this by merging groups, deepening digital demand generation and branding, analytics/modeling, content management, and marketing technology. There is also a rise of Marketing Centers of Excellence (“COE”), especially digital demand centers and content, as a way to build critical mass in competencies and bring together related disciplines.
The Recruiting/Retention Crisis
CMOs looking to hire find the climate challenging. While the pool of candidates is large, finding the right candidate for the role who is interested in joining the company is difficult.
In attracting candidates larger, established or traditional companies, face the obstacle of not being considered ‘hot’ enough. That reduces the pool of candidates substantially for key positions in analytics, data science, modeling and digital marketing. Mostly comprised of Millennials, candidates feel their creativity, mobility, opportunities and need for flexibility would be restricted by joining large or mature companies. To be competitive CMOs of established companies are evolving their culture and structures as much as possible to meet the expectations of candidates. Even with these changes CMOs find they have to invest a lot of time in selling the vision of the company, their marketing strategy and the position.
CMOs of companies with brand cache have the reverse problem. Retention is a persistent problem. Their employees are constantly being recruited away with lucrative offers creating, in one case, 20 percent turnover. This is fueling a debilitating cycle where ‘hot’ companies are constantly recruiting from each other. Tactics CMOs use to retain top talent include constantly moving people between roles and managing them differently by increasingly offering more latitude, responsibility and opportunities to do new things.
The rising sophistication and transparency of metrics to report on conversion and marketing ROI is enabling every CMO’s desire to have a credible seat at the management table. Marketing has real, hard data to prove its contribution to the pipeline and topline – as long the language the CMO speaks is financial.
The metrics Boards expect from CMOs are revenue pipeline and predictability. While Marketing may present dashboards on the conversion rates of campaign-to-close funnels, win rates, and customer segment metrics, the only thing that boards and CEOs care about is pipeline.
By talking about marketing programs, investments and initiatives in financial terms, CMOs have seen an unprecedented level of alignment occur across the organization especially with Sales. The Sales conversation is not about leads but pipeline, customer engagement, conversion and close rates.
In an ideal world CMOs would like to have more strategic conversations with their CEOs and boards about the value of activities and impact of investments that are not directly tied to revenue. Reputation, awareness, customer experience, the performance of cohort customer groups, pipeline by channel, influence of communities/digital properties, and how marketing plans to drive growth are a few topics on the CMO wish list. But having been burned in the past, CMOs keep the conversation strictly on revenue.
For any executive staying on top of their “game” is hard. While the expectation is that CMOs are ‘out in front’ of their field, reality is quite different. Just as customers are overwhelmed and fatigued by the constant bombardment of information, so too is the CMO. Sorting through a constantly overflowing inbox of emails, scanning multiple feeds and publications for relevant articles, staying current on thought leaders and culling all that down to daily reading list is unrealistic. CMOs don’t do it, not from lack of interest or motivation, but from a lack of time. Their days are spent on managing relationship with key internal and external constituents, customers, as well as revenue related metrics.
CMOs let relevant content come to them. There are a handful of publications, print and digital, that CMOs regularly scan including Fast Company, Harvard Business Review, Forbes and McKinsey reports. There is no set list topics that interests each CMO, it varies based on the issues facing them and the company.
So how do CMOs stay on top of their game?
Most rely on their teams to keep them informed on best practices, news and relevant developments. Their reliance on teams to stay current ups the ante on the hiring process; it’s career-critical that the best qualified and cultural fit candidate be brought into the organization.
Sadly, the number of CMOs that have trusted relationship with their CEOs is in the minority, which leaves CMOs on their own to navigate their careers and companies. CMOs are increasingly turning to independent professional coaches and small networks of trusted former leaders for business and career advice.
The bottom-line is that this is a lonely role for the top marketer who is responsible for navigating the white waters of turbulent times.