One of the most critical traits of an effective CMO is to play a key role in company growth initiatives, according to recent research. So how are organizations defining growth, and where can CMOs make an impact? A new report from Deloitte and the CMO Council delves into this topic.
Here are 5 takeaways from the report.
1. Growth Metrics: Agreement on Revenue; Misalignment on Brand Valuation?
The 191 senior marketers surveyed for the report were asked how their organizations define growth and where they feel they’re most prepared as marketers to make an impact.
The leading response was – not surprisingly – revenue. Virtually all respondents (95%) say their organizations measure growth by revenue, and 7 in 10 likewise feel prepared to have an impact on revenue.
Marketers see their impact as more muted in other areas, though. For example, while about half say their organizations measure growth on the basis of gross margin (51%) and market share (49%), fewer than one-third of CMOs feel confident about their impact in these areas (20% and 32%, respectively).
Client retention, customer satisfaction and customer lifestyle value are other growth areas where marketers’ confidence trails perceived organizational emphasis.
The reverse is true in a couple of growth metrics, though, most notably for brand valuation. Roughly one-third (32%) of marketing leaders surveyed believe that they impact brand valuation, but only one-fifth (21%) indicate that their organizations define growth this way.
2. CMOs Lead Brand Development, Less Likely to Commandeer CX Strategy
Although much has been made of CMOs’ growing influence over the customer experience, this latest study indicates that CMOs’ leadership lags in this area in comparison to other brand growth areas.
Fully 82% of CMOs surveyed reported leadership of brand development and storytelling, making this the top area under their control (of the 5 brand growth categories identified). But while three-quarters also reported leadership of customer engagement and communications and almost two-thirds (65%) of marketing mix modeling, customer experience strategy is the purview of half of respondents.
These results align with the most recent edition of the CMO Survey [pdf]. In that study, 91% of CMOs surveyed said that marketing leads the brand, while half (51%) said that marketing leads the customer experience.
Meanwhile, although CMOs feel relatively confident in their role as a brand growth leader, fewer are sales and experience orchestrators. Most feel instead that they have influence rather than leadership in these areas, ranging from service and support delivery to friction identification and resolution, tech stack innovation, and talent development.
Where CMOs have less of an impact, it seems, is in identifying routes to revenue. A majority say they’re not involved in areas such as in-store operations, supply chain optimization, and mergers and acquisitions, with only about 1 in 10 or fewer leading these areas.
Furthermore, marketers are more likely to lack involvement than lead efforts to map global expansion and advance distribution channels.
3. Marketer-Organizational Alignment is… Fairly Strong
CMOs believe that organizational alignment would help them become more effective much more than increased budgets or authority, per recent research.
Organizational alignment seems to be fairly “tight” in the CMO Council and Deloitte study, as almost one-third (31%) of respondents said that organizational allies are totally aligned and in full support of their growth strategies and goals. Another 40% said that their organizational allies are supportive and quick to offer advice and recommendations even though they’re not actively involved in deployment.
That leaves fewer than one-third of marketers reporting that organizational allies are either focused on their own agendas (26%) or failing at execution despite strategic alignment (3%).
But while organizational alignment seems mostly strong, it’s interesting to see that marketers only seem to be allied with a couple of other positions.
Chief among those is the President/CEO, which 71% of respondents identify as being among their greatest allies and champions. A majority (55%) also report healthy alignment with the head of sales.
But beyond that, few report alignment with line-of-business leadership (37%), the Chief Financial officer (34%) – with whom there may be differences of opinion on the value of marketing – and the heads of service and support (14%). Few CMOs also see the Chief Operating Officer (29%), head of product (28%), Chief Information Officer (23%) and head of HR (13%) as key allies and champions.
4. Few Look to Market Expansion for Growth
CMOs most broadly seek to initiate or optimize growth through new customer acquisition, with roughly two-thirds (68%) seeing this as their top growth factor. Improving customer targeting (45%) and optimizing upsell and cross-sell strategies (44%) are also significant growth factors.
However, just 1 in 4 marketers surveyed have plans to turn to global market expansion as a growth factor, and only 1 in 8 (13%) plan to identify new opportunities by focusing on underdeveloped or overlooked markets. That seems to be in contrast to other research that has found new markets to be among B2B CMOs’ most important growth strategies.
That same study indicated that B2B marketers are turning to audience-centric rather than product-centric growth strategies, a view which is supported by this latest research. As per the CMO Council and Deloitte report, a sizable share of marketers recognize that product-centric thinking that puts the customer at the end of the conversation can lead to an organizational culture that doesn’t put the customer at the heart of decisions.
5. Data and Intelligence Skills Are Mandatory
CMOs tend to see organic growth as more about talent than tech, and there are certain skills that are must-haves in today’s growth environment.
Knowledge about data and intelligence (56%) leads all of those skills, per the report, which makes sense in light of other studies indicating that CMOs are confident in their strategic thinking but need help with analytics.
Beyond data and intelligence mastery, critical skills for today’s growth leaders include market insights and knowledge (50%) and a holistic view of the customer journey (49%).
The report’s analysts note that these have become so important that traditional areas of CMO expertise – such as brand building and development and storytelling in a digital world – are now considered less critical than the aforementioned skills.
The full report is available for download here.
About the Data: The results are based on a 10-question online audit of 191 global senior marketing leaders completed in Q1 and Q2 2018. Some 37% of respondents hold the title of chief marketing officer, senior vice president of marketing or head of marketing, representing companies with revenues in excess of $1 billion USD.