Are CMOs Becoming An Endangered Species?
In this post, Raz Chorev (pictured below), CMO at Sydney marketing executive-as-a-service firm Orange Sky, argues marketers are increasingly lost about their actual role and it’s time to rediscover it before it’s too late…
In the past two weeks, we’ve witnessed two of the largest consumer brands losing their CMOs. Coca Cola’s Global CMO was let go due to a restructure, and in Australia Unilever’s CMO was made redundant. This topic flamed a conversation I had with a potential partner, as he challenged the relevance of the chief marketing officer in today’s market. His doubts weren’t unfounded – it appears there’s a trend (his words) where chief marketing officers are losing their footing in large organisations; Coca Cola and Unilever, arguably the largest marketing organisations in the world, are just the latest examples of this trend.
Without nit-picking on the word “trend” and panicking over the demise of the marketing role, let’s examine what actually happen with these organisations:
Coca Cola has undergone a major corporate restructure. They’ve brought together global marketing, customer and commercial leadership roles, and corporate strategy has been brought under one roof. Although the CMO role was axed, the two other functional leaders will keep their job, but report to a ‘Chief Growth Officer’.
What I find interesting is that a new role was created separately from this new cluster – Chief Innovation Officer, which reports directly to the Global CEO. Personally, I find it odd, and I’ll explain why shortly.
As for Unilever, the CMO role in Australia was cancelled only 13 months after it was created. Previously the CMO function was jointly owned by local VP of Marketing and the VP of Food and Refreshments. This is obviously a very different scenario to the Coca Cola one, hence a “trend” it isn’t…
I won’t try to analyse the reasons behind the two separate instances, as I don’t have the information beyond what I’ve read in industry publications. What I can do is make some assumptions, and see if other organisations might be able to learn from it.
The legendary management and marketing guru, Peter Drucker famously said: “Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.”
Today, when top management is surveyed, their priorities in order are: finance, sales, production, management, legal and people. Missing from the list: marketing and innovation. When one considers the troubles of the world’s brand icons in recent years, it is easy to see how Drucker’s advice might have helped management to avoid the problems they face today.
So when Coca Cola created a role for the chief innovation officer, separating it from the traditional marketing function, and from the newly created Growth office, I raised an eyebrow. I understand that businesses are trying different things, different roles, structures and functionalities, but I’m struggling to see how creating different types of silos is going to help the organisation move forwar
A couple of weeks ago I had a LinkedIn discussion led by Andy Lark – an accomplished corporate CMO. Andy stated: “Reality is marketing and CMOs have never been more misunderstood. Real reason they are losing their jobs is hypocrisy and naivety amongst CEOs and their boards. And that’s sad.”
[Context: Andy responded to a claim made by a data analytics CEO, who said “Recent CMO Council research indicates that a record # of CMOs lost their jobs in 2016, and that the #1 reason was “failure to show business impact.” That CEO was actually indicating that CMOs weren’t using the right tools, and his AI analytics platform was what was missing from the CMO’s MarTech arsenal.]
I tend to agree with Andy. Boards and CEOs don’t understand what the marketing function is, and reduce the role as merely an execution arm of the business primarily in charge of promotion (the third “P” in the marketing mix.). When CEOs and boards understand the scope of the marketing realm and breadth of responsibility, the marketing as a function will be restored to its old glory, and direct enterprises into a more stable and predictable future.
When boards and CEOs reduce the marketing leader’s role to manage brand and promotions, it makes it increasingly difficult to show business impact. Arguably, it’s the marketing professionals’ own fault that their role and profession is so misunderstood. I believe it’s down to us to promote our impact on business, to showcase our worth and what our roles are worth. A CMO who is offered a role that will only allow him/her to manage the brand and promotional activities, should, in my opinion, decline the opportunity.
Let me explain why.
A true marketer, should be the person in charge of creating a customer. Whitney Hess sums it up perfectly by quoting Peter Drucker (I know, it gets old…), saying that the sole purpose of a business is to create a customer. Whitney defines a customer as a person (or entity) who pays for a good or a service. She focuses on the term “pay”, as opposed to the common misconception that a user should also be treated as customer. The fact is, businesses cannot survive without users, as until there’s a monetary exchange, there is no business.
She goes further to explain: “the function of marketing is to attract the prospect. The function of innovation is to transform the prospect. The prospect can’t be changed if they’re not paying attention; they won’t pay attention if they sense they can’t be changed. Both functions, in harmony, are required to seal the deal: to convert a prospect into a customer, to get paid.”
So if the marketing and innovation functions are both the foundation of the business – creating the product/service and converting prospects into paying customers, it makes no sense that the two functions aren’t working together under the same structure (see my earlier comment about Coca Cola).
I do, however, understand why there’s no need for local CMOs of global businesses (e.g. Unilever). If a CMO needs to attract the prospect, but has no impact on product / service innovation, they will get into all sort of trouble and forced to create “commercial impact” in questionable ways (see Nurofen debacle).
It’s time for the marketing profession to rise back into its former glory, and for us, as marketers, to take charge, educate and influence our peers on what marketing really is. I find it absurd that marketers can’t “attract their own prospects”, and create a customer for their profession. Let’s gather as marketers, and stop that “trend” from ever becoming one.
Latest News
The Mars Agency Announces Latest Findings Of Retail Media Report Card
The Mars Agency has developed a scorecard that assesses the capabilities of leading platforms across key criteria required to optimally plan, execute, and measure effective retail media programs. The scorecard aims To help brands efficiently evaluate their spending options across retail media networks in Australia (and New Zealand). With spending on retail media advertising in […]
‘It’s The Lesser Of Two Evils’ – NRL Eyes US Betting Market As Aussie Regulators Circle
US betting firms will be delighted by the circa 50,000 Americans who could soon watch the NRL on their favourite app.
A-League In Deep Discussions With New Partner To Keep Games On TV After Production Company Enters Administration
The A-League's insatiable appetite for scoring own goals continues.
TV Ratings (27/03/2024): Jungle Members At War Over Concealed Lipstick
A heated argument between two jungle members did the numbers for Ten last night, with I’m A Celeb obtaining a total national reach of 1,282,000. Fans were delighted as Candice Warner and influencer Skye Wheatley got into it over a stick of lipstick, leading Warner to dub the Instagram star “selfish.” Wheatley, best known for […]
Is The Australian Music Industry In Trouble? Inquiry Launched Following Splendour Cancellation
Earlier this week, an inquiry was launched into the challenges and opportunities currently facing the Australian live music industry in the wake of multiple festival cancellations. On 25 March 2024, the Minister for the Arts, the Hon. Tony Burke MP, asked the Committee on Communications and the Arts to inquire into and report on the […]
Liana Dubois, Leandro Perez, Aimee Buchanan & More Gather For Inaugural Compadres Leadership Event
Didn't get the invite? Perhaps you're not as important as you thought.
Cathay Captures The Unforgettable Thrill Of Cathay/HSBC Hong Kong Rugby Sevens, Via Publicis
Nobody does rugby like Hong Kong, apparently. Certainly nobody does it as badly as Australia.
Cocogun Nabs Christine Watts, Kirsty Reynolds & Shev Tan Bolstering Management & Creative Teams
Cocogun bolsters its team with new hires. Committed to purchasing a bigger sofa, too.
The Media Store’s Jacquie Alley & Sam Cousins Take The Plunge With Pro-Bono Work For Cure Cancer
B&T chats with The Media Store bosses about their great pro-bono work and sponsored swim.
Hawke’s Brewing Co. Taps Rocket Comms For PR Agency Following Competitive Pitch
We're expecting Rocket Comms productivity to crash in spectacular fashion following this win.
Spotlight On Sponsors: Patties Serves Up A Taste Of Home For Olympians & South Sydney Rabbitohs Recommit To Gambling Reform
While the Rabbitohs commits to gambling reform, B&T reckons the team should commit to a decent auto sponsor.
Google: “Inevitable” That Bad Actors Will Abuse Ads Platform As Advertiser Account Suspensions Double
Google maintains it's simply impossible for it to entirely stop bad people placing & paying for ads using its service.
Quantcast Expands APAC Sales Team With Appointment Of News Corp Account Manager
No pressure at all when you are appointed as a client success manager.
Publicis Sapient Tests Microsoft-Powered Gen AI Search Tool With Homes & Villas By Marriott Bonvoy
Given Gen AI's record for mangling stuff, B&T cannot see the problem with letting it decide your next holiday digs.
Volkswagen & DDB Group’s “Roo Badge” To Reduce Kangaroo Related Road Collisions
Watch out for RooBadge as Cannes Lions' most debated campaign this year.
Twilio Launches Unified Profiles & Agent Copilot Features To Boost Productivity & Engagement
Agent Copilot sounds like James Bond's less interesting cousin.
Reebok & Honda Among New Clients For onetwo agency
OneTwo finally lives up to its name with this double billing.
Ogilvy Report: Throw Out The Social Strategy Rule Book, The Rules Of The Past No Longer Apply
B&T was puzzled that all 'influencers' aren't, effectively, 'virtual', but here we are.
WhiteGREY & AKQA Merge In Australia, Lee Simpson Departs
Fortunately, the combined agencies aren't opting for a trite portmanteau for the new name.
Splendour In The Grass 2024 Music Festival Cancelled!
Music fans all over the country reportedly relieved they can pack away their rain coats and gumboots for another year.
TV Ratings (26/03/2024): “Fairy Bread, F***ing Disgusting”: Gordon Ramsay Slams Aussie Food In Food Stars Launch
Ramsay not one for mincing his words, even when it comes to minced meat pies.
Paramount+ International Boss Doubles Down On Aussie Content, Says Ad-Tier will Grow Audiences And Revenue
Good news as Paramount will not be binning I’m A Celebrity for re-runs of Frasier.
Brent Smart: Telstra Pushing For 50-50 Brand-Performance Split But Warns Numbers ‘Won’t Look Great’ Initially
The old brand vs performance debate continues. But here, Brent is firmly sitting on the fence.
Crowded House, Tones And I & Dom Dolla Win Big At The Shure Rolling Stone Music Awards
B&T staffer reports back with humdinger of a hangover & feeling seriously uncool after mixing with music types.
Opinion: Dyslexia “A Hidden Gem” For Brands & Agencies
Dyslexics offer underappreciated benefits in the corporate field, according to this op-ed.
David Jones Taps Criteo To Power Online Retail Media Arm
Want to see ads for things you probably can't afford? David Jones has got you covered with new retail media play.
oOh!media Sets Up Team To Target Business Audiences Across Airports & Offices
oOh! wants brands to harass you every minute of your next business trip.
QMS Launches Australian First DOOH & TV Partnership With Samba TV
Samba TV, of course, is not a channel dedicated to dancing. Much to our dismany.
Slew Of New Hires At Amplify
Four new faces join the Amplify offices. Team say desk scarcity becoming "acute".
Adobe Announces Content Authenticity Initiative Expansions To Counter Deep Fakes
Try as they might to enlighten them, we suspect Trump supporters will continue to watch and believe Fox News.
The PR Group Appoints TechCrunch Senior Reporter Catherine Shu As Director Of Content & Media
Catherine Shu makes the bold leap from journalism to PR. Says inevitable pay bump was "unrelated".
HERO Nabs Ebony Santin From AMPR
Rumours Santin cleared out the stationery cupboard before departing are as yet unconfirmed.
Karena Noble Checks Out Of EVT Hotels & Resorts To Launch Comms Consultancy
Noble still managed to squeezed in a continental breakfast before departing.
Canva Acquires Design Platform Affinity To Bring Professional Design Tools To Every Organisation
Canva & Adobe face off continues. We're not picking sides but keenly aware that Canva's office is next door to ours.
“Lean On Our Team To Help You Find An Audience”: Why Understanding Audience Engagement Is Essential In Journalism
Engaging the audience is critical to journos, apparently. We'd thought self-loathing & alcoholism were key.
Adobe Summit: Major Gen AI Developments, Data Concessions & Partnerships
What happens in Vegas stays there. Unless it's the Adobe Summit and then you get to read about in B&T.