CMO-Speak
Over the past four years, I have had numerous conversations with marketers as I have discussed Netcore’s martech solutions and my marketing ideas with them. There are five insights which have stood out in these discussions.
“My focus is growth, not profits”: CMOs almost exclusively focus on growth, spending, and the size of their budget. The responsibility for profits in their mind is with the CEO and CFO. They emphasise the importance of growing the customer base (“land grab”), even at the expense of short-term profits, highlighting a strategy focused on long-term market dominance. The metrics that get measured are website traffic or app downloads, rather than those that show customer value or long-term engagement.
“Growth needs constant acquisition of new customers”: To deliver growth, the route is to spend on the adtech platform for continuous inflow of new customers, underlining the importance of expansive marketing strategies. While they view customer retention as important, their primary emphasis is often on attracting and converting new prospects through various marketing channels and tactics – because that is the expectation from the CEO and the board/investors.
“Martech/retention is hard and not as easy as adtech/acquisition”: While CMOs recognise the importance of retention and generating more from their existing customers, they find it hard to overcome the problem of attention recession and funnel frictions. In contrast to the complexities of martech platforms and the need for day-to-day management of customer journeys, segments, analytics, campaigns, content, optimisations, and loyalty programs, adtech is so much easier: call up an agency, give a budget, approve creatives, track cost per click, and relax!
“The IT team has no time for building the ideas I come up with”: Another hurdle that comes up is that CMOs do not have control over the tech team, which means any new software needed becomes an IT project under a different leader. Tech and marketing don’t necessarily see eye-to-eye, and creating alignment is not easy because the IT teams may be stretched thin or prioritise other projects over marketing initiatives.
“To grow, I need to move to a bigger company with a larger budget”: Faced with these challenges, CMOs spend a few years in a company and tend to get frustrated when they are held to account for outcomes they see beyond their control. Their solution for growth and impact: move laterally to a similar role in a larger company with more resources.
Here are my typical replies when I get these inputs:
- Marketers must think profitable growth, not just growth at all costs. This is the only way they can escape the “CAC Trap” where acquisition costs grow faster than revenues and AdWaste eats up half of the marketing budget.
- Sustainable profitable growth only comes from ensuring existing customers keep returning and bring their family and friends (referrals) – maximising CLV (customer lifetime value) which in turn helps reduce CAC (customer acquisition costs).
- Marketers need to think of a “unified tech stack” rather than point solutions, and creating single view of customers to simplify marketing. Directionally, they need to move towards creating a digital twin of every customer and an AI Assistant to improve conversion optimisation.
- While low-code and no-code martech platforms along with AI-ML are reducing the need for IT involvement, CMOs must build better working relationships with CIOs and CTOs, essentially creating a joined-at-the-hip Chief Digital Officer.
- CMOs need to think long and aim high to aim for the CEO position. With an entrepreneurial mindset, an “I-am-the-Chief-Profits-Officer” attitude, and a hunger for learning new skills, CMOs can position themselves to rise in their current organisation rather than exit for newer but similar pastures.
It is through these conversations that I started thinking about the larger problem: What if CMOs thought themselves as CEOs-in-waiting? Would they think differently? Today, CMOs don’t see an easy path to becoming CEOs, but what if they could? What would a Maya-like CMO-to-CEO playbook look like?
