CMOs: On The Outside Of The C-Suite, Looking In

The question “why do marketers so rarely end up with seats on corporate boards?” is one that has been discussed to exhaustion over the years.?

The general conclusion usually reached has been that CMOs tend to struggle speaking the finance-dominated language of the rest of the C-Suite.?

According to the Global Accounting Network, 51% of the CEOs at the 100 biggest UK companies have a background in finance.

And in hard economic times, the need for a strong financial lead is particularly pressing.?

Even when marketers are present, they’re rarely a dominant force.?

This poll we carried out on LinkedIn puts the situation in stark terms:

The CEO and CFO are calling the shots in most companies.?

Mark Ritson is clear who’s at fault for marketing’s marginalisation. He told a Festival of Marketing panel in 2020:

“When the CFO doesn’t get the value of branding, doesn’t allow us to propose the budget, it is not the CFO’s fault, it is our fault.”

I agree.?

As long-time CMO Colin Faust has said:

“Boards really only care about one thing — are we going to meet our number and do we have the coverage to get there? Marketing's role should be to help simplify metric reporting to answer that question and prove marketing's ROI.”

But there’s more to it than just that.?

Doesn’t the CMO have a part to play in determining what “our number” should be as well?

The CMO: Bringing the customer into the boardroom?

How?

It’s often said that the one unique contribution that marketing can make is to bring the customer’s voice into the boardroom.?

Without understanding what today and tomorrow’s customers want - which only marketing is equipped to discover and communicate - boards can descend into short-termist groupthink.

So yes, the CMO is needed to represent the customer’s point of view but that’s still only half the story.?

Any fool should be able to give the public what it wants.

The CMO’s unique contribution is to find a way to triangulate:

• What the market wants
• What the company wants
• In a way that makes money

Does that move the needle?

Data from the Darden Business School at the University of Virginia would suggest so:

“In analysis we conducted of 64,086 board member biographies (from Standard & Poor’s 1,500 firms between 2007 and 2012), we found that a firm’s annual revenues can be expected to increase by nearly 6 percentage points when at least one marketer is on the board.”

Yes, this data is nearly ten years old now, but it’s such a strong correlation that repeating the survey today would probably yield comparable results.?

That suggests that high-level influence for the marketing function has the potential to be a secret weapon for businesses that want to stand out from the crowd.?

Why so unusual then?

Well, it’s likely? that few marketers are sufficiently rounded executives to hold their own at board level.?

That’s a problem because as we’ve already mentioned, boards can lose sight of the reality of their customer bases when nobody is putting that point of view forward in terms that show why it matters.?

For example, at Mimo Brands we recently worked with a major international gaming brand to help develop their brand strategy.?

The prevailing wisdom at the highest level was that growth was best served by chasing after a younger audience.?

Using proven marketing methodologies, we demonstrated that there was much more to be gained by targeting older players - and that the young market they had assumed would be lucrative was in fact the toughest route to profitability available.?

Many CMOs have the skills to disprove board presumptions and provide data-led alternatives.?

But they lack the ability - or opportunity - to communicate it effectively.?

Speaking as a marketer, I have to say that our cause is not well served by the obfuscation and “fluffiness” that all too often surrounds perceptions (less often the reality) of what we do.?

The varied and various ways value is attributed to brand and to marketing and the nebulous measurement techniques that are often employed justifiably command little confidence from the C-Suite.?

Across our entire discipline - but particularly at the top levels - marketers need to think more like ‘whole business’ people than narrow specialists whose top priority is execution.?

That’s not a new conclusion. In fact, it’s been staring us in the face for years.?

In this Campaign article from 2004, Centrica CEO Sir Roy Gardner is quoted as saying:?

“Marketers must stop thinking of themselves as functional specialists; they must become literate in economic and financial analysis; and they must act as a customer champion within their organisation, developing and delivering customer-driven strategies.”?

If we can bring the evidence to the boardroom and make it compelling, quantifiable and concise - showing where value is in the market and how to get it - the rest of the C-Suite will listen.?

Once you start talking about money, you’ll get a hearing.?

Bigger Companies and Smaller Companies

Ironically, it is more often the big corporates that appreciate the value of a marketing presence on the board.?

Smaller businesses tend to be far more directed by the background and expertise of the CEO - and as we’ve seen, most of them come from finance.?

It’s still very rare for tech startups, for example, to include a top-level marketer among their launch teams.?

And that can lead to problems down the line. When brand and marketing are not part of a business’ DNA from the outset, they often remain on the outside - a “bolt-on” rather than an integral element.?

Just like companies that try to bolt “purpose” onto their brands, companies that bolt marketing on to their overall business strategies will rarely truly benefit from it.?

There is no substitute for a team all pulling in one direction based on solid evidence (and creativity) to create a brand strategy that hits both short and long term objectives - that trusts and values brand and marketing.?

But the challenge for a CMO is to align solid business objectives and the numbers with the creative thinking that allows brands to thrive, deliver and punch above their weight.

The Solution?

Well, there’s a long-term solution and a short-term one.?

The long-term one is for more marketers to develop those critical business skills as they work their way up to the CMO role.?

The first step on that journey is to cut out all talk about “concepts, ideas, creativity etc” when dealing with the finance function.?

As Cuba Gooding Jr’s character said in “Jerry Maguire”:?

So show them the money.?

Another example from Nicolette’s experience.?

It wasn’t that long ago that Bombay Sapphire gin was on the verge of being de-listed: the numbers looked bad, the gin category was in dramatic decline.

Nicolette put together a strategic plan that asked for minimal investment (￡50,000), showed the transition from break-even to profitability within 5 years and allowed for a test/pilot that could be withdrawn at key moments. That allowed the finance director to feel comfortable with a considered investment.?

And it worked. But it only got off the ground because it was couched in the CFO’s language.?

Building a relationship here is fundamental. Knowing when to ask for investment and when to pare back funds is key.

All too often, CFOs are presented with a plan that just asks for 10% more to spend than last year with no reference to ROI.

And the short-term solution?

Well, that’s where Mimo Brands comes in.?

We have decades of experience working at the highest levels.?

We’ve even been described as “the CMO’s secret weapon”.?

Mimo Brands regularly works with senior marketers and boards to help them refine their strategies in a way that ensures brand and marketing impact is put front and centre in terms of how it affects the bottom line.?

We work as consultants and/or mentors to CMOs and their teams, helping to equip them with sound evidence and persuasive arguments that the board will listen to.?

If this sounds like something you could use, please feel free to connect with me here on LinkedIn and let’s talk.?