Published July 25-31, 2025
1
Overview
In my previous essay, I explored how NeoMarketing provides the systematic approach to achieving sustainable, profitable growth. Here is a summary of the key ideas.
NeoMarketing: Engineering Marketing’s Third Great Era
Marketing has reached its own “mission impossible” moment. Like breaking the sound barrier or landing on the Moon, achieving simultaneous growth and profitability has long seemed insurmountable. Traditional marketing forces an impossible choice: CMOs deliver growth, CFOs demand profits, and CEOs want both. Yet rising marketing spend continues to outpace revenue growth by 30-50%, whilst 70% of budgets disappear into reacquisition AdWaste—repeatedly paying premium prices to reach customers already in the database.
This structural failure isn’t merely a budgeting problem. It’s the inevitable result of marketing’s evolution through two distinct eras. Brand Marketing (1950s-1990s) built awareness through mass media but struggled with measurement. Performance Marketing (2000s-2020s) solved measurement through digital targeting but created platform dependency and the £500 billion AdWaste crisis.
NeoMarketing represents marketing’s third great era—a systematic approach to engineering profits, not just growth. Rather than optimising existing approaches, it inverts the fundamental assumptions that have governed marketing for two decades.
The Five Great Shifts
NeoMarketing transforms marketing through five critical transitions:
- From Rented Reach to Owned Attention: End the 20-30% platform “revenue tax” by building direct customer relationships through websites, emails, apps, and WhatsApp rather than renting access through Google, Meta, and Amazon.
- From Revenue Engineering to Profit Engineering: Replace growth-at-any-cost mentality with systematic margin improvement focused on lifetime value, repeat purchase rates, and Rule of 40 performance.
- From Reacquisition Addiction to Retention Mastery: Shift from first-sale obsession to repeat-sale focus, halving AdWaste through loyalty programmes that systematically grow customer value over time.
- From Anonymous Segments to Identified Individuals: Move beyond third-party cookies and demographic approximations to first-party data and N=1 personalisation that recognises each customer’s unique value potential.
- From Fragmented Tools to AI-First Integration: Replace manual operations across disconnected martech stacks with AI agents powering autonomous systems that learn, adapt, and optimise continuously.
The 4 A’s: Breakthrough Technologies
Four innovations make NeoMarketing’s profit engineering possible today:
- Agents: AI-powered multi-agent systems enable true 1:1 relationships at scale through the AI Agents Collective, making every customer feel unique without human overhead.
- Agency: Progency reinvents the agency model with outcome-based pricing—earning only when measurable growth is delivered, aligning incentives for true profit partnership.
- Attention: NeoMails solve the “No Hotline” problem by creating habit-forming engagement channels that transform the inbox into daily owned media.
- Acquisition: NeoN creates the world’s first brand-to-brand cooperative ad network using authenticated identity targeting, allowing brands to simultaneously monetise their audiences and reach dormant customers at 30-50% lower costs.
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NeoMarketing is the only path for systematic, sustainable, profitable growth, transforming marketing from cost centre to profit engine, delivering systematic profit margin improvements and Rule of 40 performance.
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North Star Metric
The North Star Metric for measuring the NeoMarketing transformation should be the Rule of 40—originally developed for SaaS but equally powerful for any business. The Rule of 40 states that a company’s combined revenue growth rate and profit margin should exceed 40%, creating a balanced framework that prevents the false choice between growth and profitability. I wrote in EAGLES: The Six Essential Metrics to Revolutionise eCommerce Profitability:
The Rule of 40 provides an elegant solution to the growth-versus-profitability dilemma that plagues many eCommerce businesses. By stipulating that a healthy business’s combined revenue growth rate and profit margin should exceed 40%, it creates a flexible framework that accommodates different strategic phases while maintaining fiscal discipline.
This metric acknowledges that companies may legitimately prioritise growth over immediate profitability, but not without limits. A business growing at 50% annually can run at a 10% loss and still meet the Rule of 40 standard, while a mature business growing at 15% should generate at least 25% profit margins.
What makes the Rule of 40 particularly valuable for eCommerce is its ability to counterbalance the industry’s frequent over-emphasis on growth at all costs. By incorporating this metric into regular reporting, businesses create a natural brake against unsustainable practices like excessive discounting, over-reliance on paid acquisition, or margin-eroding free shipping policies.
I asked Claude for an explainer on why the Rule of 40 is such a good metric for every company.
The Rule of 40, originally popularised in SaaS circles, offers a brilliantly elegant solution to one of business’s most persistent dilemmas: the false choice between growth and profitability. This metric—which requires that a company’s combined revenue growth rate and profit margin exceed 40%—provides a flexible framework that can transform how any company approaches systematic, sustainable growth.
Why Every Company Needs the Rule of 40
Prevents Growth-at-All-Costs Madness: The Rule of 40 creates a natural brake against unsustainable practices. A company growing at 50% annually can justify running at a 10% loss and still meet the standard, whilst a mature business growing at 15% should generate at least 25% profit margins. This balance prevents the common trap of celebrating growth that destroys long-term value.
Accommodates Different Strategic Phases: Unlike rigid profitability targets, the Rule of 40 recognises that businesses legitimately prioritise differently at various stages. High-growth startups can operate at lower margins whilst still demonstrating fiscal discipline, whilst mature companies must prove their efficiency through higher profitability when growth naturally slows.
Forces Strategic Discipline: Most businesses operate with separate growth and profitability initiatives that often work at cross-purposes. The Rule of 40 forces integration—every strategic decision must consider both growth and margin impact simultaneously, creating more coherent business strategies.
Real-World Application Beyond SaaS
For eCommerce companies, the Rule of 40 counterbalances the industry’s frequent over-emphasis on growth metrics like conversion rates and customer acquisition. It prevents margin-eroding practices such as excessive discounting, over-reliance on paid acquisition, or unsustainable free shipping policies.
For traditional retailers, it provides a framework for evaluating expansion decisions—new locations, product lines, or market entry strategies must contribute to the combined 40% threshold rather than just top-line growth.
For B2B service companies, it helps balance investment in new capabilities against operational efficiency, ensuring that expansion strengthens rather than dilutes the business model.
The Profit Engineering Connection
The Rule of 40 becomes particularly powerful when combined with systematic approaches to eliminate waste and maximise customer value. Companies achieving Rule of 40 performance typically focus on maximising revenue from existing customers whilst ruthlessly eliminating inefficient spending—precisely the approach that transforms marketing from a cost centre into a profit engine.
By adopting the Rule of 40 as a primary metric, companies create a balanced scorecard that ensures growth investments deliver sustainable returns whilst maintaining the operational discipline necessary for long-term success.
3
Foundations
Before deploying NeoMarketing’s advanced technologies, businesses must establish three critical foundational requirements that transform fragmented marketing operations into systematic profit opportunities. These aren’t merely technical prerequisites—they’re strategic imperatives that determine whether the marketing operates as a cost centre or profit engine.
Requirement 1: Unified Intelligence (Single Customer View)
Traditional marketing’s greatest operational weakness lies in fragmented data systems that create multiple versions of the same customer across different platforms. When the eCommerce platform, email system, advertising accounts, and customer service tools operate in isolation, it is not possible to engineer profits systematically.
Unified Intelligence consolidates every customer touchpoint into a single, comprehensive view. This integrated foundation connects transactional data, marketing engagement, behavioural analytics, and service interactions into one authoritative customer profile. Unlike traditional CDPs that simply aggregate data, Unified Intelligence creates actionable insights that power autonomous decision-making across all customer interactions.
This foundation enables AI agents to orchestrate personalised experiences, allows accurate lifetime value calculations, and provides the data integrity necessary for performance-based accountability. Without this unified foundation, NeoMarketing’s profit engineering capabilities cannot function effectively.
Requirement 2: Identify Every Customer (Mobile AND Email)
With unified intelligence established, the next requirement addresses traditional marketing’s addiction to anonymous targeting. When 70% of marketing budgets disappear into reacquisition waste, the root cause is simple: repeatedly paying premium prices to reach customers who are already known but are unidentified.
Collecting both mobile numbers and email addresses from every customer interaction creates unprecedented targeting precision whilst building owned communication channels that bypass platform dependency. Mobile numbers enable WhatsApp and RCS engagement, while email powers NeoMails campaigns, lifecycle automation, and authenticated identity matching across the NeoN network. Together, they transform anonymous traffic into identified relationships that generate compound value.
Requirement 3: Segment by Lifetime Value (Best-Rest-Test-Next Framework)
Traditional demographic segmentation tells companies nothing about profitability. The BRTN framework revolutionises customer classification by organising the database around actual economic value and engagement trajectory.
Best customers (top 20%) generate 60% of revenue and deserve AI Agents Collective treatment. Rest customers (middle 40%) represent the greatest growth opportunity for systematic migration to Best status through Progency and NeoMails. Test customers (bottom 40%) enable cost-effective reactivation via NeoN’s authenticated targeting. Next customers require efficient acquisition strategies.
This value-based segmentation creates dynamic customer categories with specific strategies, clear ownership, and measurable migration outcomes—transforming marketing from demographic guesswork into economic precision.
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Together, these three foundations create the integrated platform necessary for systematic profit engineering.
4
The Path
The images demonstrate NeoMarketing’s systematic approach to achieving Rule of 40 performance through three strategic imperatives that transform marketing economics. Rather than choosing between growth and profitability, this framework delivers both by engineering profits from existing customer relationships whilst eliminating wasteful spending.
Maximise the Best: From 60% to 65% Revenue Share
Best customers represent the most underutilised asset in most businesses. Despite generating 60% of revenue from just 20% of the customer base, traditional marketing treats them like any other segment. NeoMarketing’s approach recognises that these customers can generate significantly more value through systematic cultivation.
The AI Agents Collective makes this possible by solving marketing’s most persistent limitation: the inability to personalise at true individual scale. Where traditional segmentation creates 8-10 broad groups, AI agents enable “segments of few”—micro-cohorts that can scale down to individual customers whilst maintaining operational efficiency. For Best customers, AI Twins create conversational interfaces that understand preferences, predict needs, and orchestrate experiences that feel genuinely personal rather than algorithmically generated.
This level of personalisation was previously impossible through human effort or existing martech platforms. A single marketing team cannot create individual content for thousands of high-value customers, and traditional automation lacks the contextual understanding necessary for authentic personalisation. AI Agents bridge this gap, enabling Best customers to receive the VIP treatment that their economic contribution warrants.
Double the Rest: From 30% to 45% Revenue Contribution
Rest customers represent the greatest growth opportunity in most businesses—engaged prospects who need systematic intervention to reach their value potential. Yet most in-house teams lack the bandwidth, expertise, or technology stack integration necessary to execute sophisticated Rest-to-Best migration strategies.
Progency solves this execution gap by providing capabilities that internal teams simply cannot replicate. Through the PEAK framework (Platform + Experts + AI Agents + Kaizen), Progency delivers done-for-you marketing with performance-based accountability. This isn’t outsourcing—it’s accessing specialised infrastructure designed specifically for customer lifecycle optimisation.
The systematic approach focuses on relationship building over transaction pressure, using NeoMails to create daily engagement touchpoints that transform sporadic interactions into habitual connections. These interactive email experiences solve the attention recession problem by delivering value-driven content at zero CPM—something traditional ESPs cannot offer due to their transactional, volume-based business models.
Slash the Waste: From 15% to 10% Marketing Spend
The most immediate profit impact comes from eliminating the 70% of marketing budgets wasted on reacquisition. Traditional platforms charge premium prices to reach customers brands already know, creating a structural inefficiency that erodes margins as businesses scale.
NeoN revolutionises reacquisition through the world’s first brand-to-brand cooperative advertising network. Using authenticated identity matching based on PII rather than probabilistic cookies, brands can reach their dormant customers through partner brand audiences at 30-50% lower costs than traditional platforms. This cooperative structure eliminates platform intermediaries whilst delivering precision targeting impossible through conventional adtech.
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These three strategies compound to deliver growth rate and profit margin improvement. Growing revenue from existing customers whilst reducing acquisition costs creates a virtuous cycle where profits fund further customer experience improvements, enabling even stronger retention and higher lifetime values.
5
Impossible to Inevitable
Each of NeoMarketing’s four breakthrough technologies solves problems that were previously considered impossible within traditional marketing frameworks. These represent fundamental capabilities that transform how businesses approach customer relationships and profit generation and unlock the pathway to Rule of 40 outperformance.
AI Agents: Beyond Human-Scale Personalisation
Traditional marketing operates under a constraint that has never been openly acknowledged: true personalisation doesn’t scale. Creating individual experiences for thousands of customers requires human insight and creativity that no team can provide economically. Even sophisticated martech platforms operate through broad segmentation because the alternative—individual customer journeys—demands more human input than businesses can afford.
AI Agents Collective eliminates this constraint by enabling “segments of few” that can scale down to individual customers. Through specialised agents handling audience segmentation, content creation, journey orchestration, and performance analysis, brands can create truly personalised experiences without proportional increases in human overhead.
For Best customers, AI Twins provide conversational interfaces that understand context, preferences, and timing in ways that traditional automation cannot match. These aren’t chatbots—they’re sophisticated customer advocates that can engage in meaningful dialogue, understand complex requests, and coordinate responses across multiple business systems. This level of individual attention was previously exclusive to luxury retail or high-touch B2B sales environments.
Progency: Bridging the Execution Gap
Most businesses understand retention theory but struggle with retention execution. The gap between knowing what should be done and having the capability to do it systematically represents one of marketing’s greatest challenges. In-house teams face bandwidth constraints, technology integration complexities, and the need to balance retention with acquisition responsibilities.
Progency provides capabilities that internal teams cannot replicate: dedicated specialists focused exclusively on customer lifecycle optimisation, AI-powered automation that operates continuously rather than in campaign bursts, and performance-based accountability that aligns vendor success with client outcomes. This infrastructure enables sophisticated strategies like predictive intervention, behavioural trigger automation, and systematic Rest-to-Best migration that require dedicated focus and specialised expertise.
NeoMails: Solving Attention Recession
Email marketing faces a fundamental economic problem: traditional ESPs charge based on volume, creating misaligned incentives for engagement quality. Brands pay more to send more emails, regardless of whether those emails create value for recipients or businesses. This volume-based model encourages frequency over relevance, contributing to the attention recession that plagues digital marketing.
NeoMails operates on fundamentally different economics—zero CPM engagement through interactive email experiences that create value for recipients. By building habit-forming daily touchpoints that feel more like app experiences than traditional email campaigns, NeoMails reclaim attention without paying platform taxes. This shift from interruption-based to invitation-based engagement represents a fundamental evolution in how brands maintain ongoing customer relationships.
NeoN: Cooperative Ad-vantage
Platform dependency creates a structural disadvantage where brands compete for customer attention through intermediaries who capture 20-30% of transaction value. Traditional retargeting compounds this problem by charging premium prices to reach customers brands already know, creating the AdWaste crisis that erodes profitability as businesses scale.
NeoN’s brand-to-brand cooperative network eliminates these intermediaries through authenticated identity targeting based on deterministic PII matching rather than probabilistic cookies. Participating brands simultaneously function as publishers (monetising their engaged audiences) and advertisers (reaching dormant customers cost-effectively). This cooperative structure creates mutual advantage whilst delivering precision targeting impossible through conventional adtech platforms.
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Together, these breakthroughs enable the systematic profit engineering that makes Rule of 40 performance inevitable rather than aspirational.
6
The Who – 1
We’ve explored the What—NeoMarketing’s systematic approach to profitable growth—and the How—the foundational requirements and breakthrough technologies that make Rule of 40 performance inevitable. But the most critical question remains: Who will make this transformation happen?
The answer lies not in hiring new executives or restructuring organisations, but in recognising that CMOs must evolve into something unprecedented: Chief AI and Profits Officers who bridge the gap between customer understanding and business outcomes.
From Collection Agents to C-Suite MVPs
Performance Marketing’s greatest tragedy wasn’t just the $500 billion AdWaste crisis—it was how it diminished the CMO role itself. Over two decades, CMOs were gradually transformed from growth strategists into sophisticated collection agents for Big Adtech, optimising campaigns within platforms they didn’t control, measuring metrics that didn’t matter, and defending budgets that delivered diminishing returns.
The McKinsey research reveals the devastating impact of this transformation. Marketing has “slid to the back seat at many companies, resulting in a loss of customer focus.” Only half of CMOs surveyed believe marketing executives are involved in strategic planning. Even more telling, 70% of CEOs measure marketing impact based on revenue growth and margin, yet only 35% of CMOs track this as a primary metric. The disconnect couldn’t be clearer: whilst CEOs demand business outcomes, CMOs remain trapped in tactical measurements.
But NeoMarketing represents more than operational transformation—it’s the CMO’s pathway back to strategic relevance and C-suite leadership. As the McKinsey study concludes, companies need to “Pull the CMO back to the center, have them align with the CFO, and get everyone moving in the same direction.”
The Three Essential Skills for CMO Evolution
To reclaim their position as growth leaders, CMOs must develop three interconnected capabilities that traditional marketing education never provided:
- Understanding What AI Can Do—Beyond Technology to Impact and Innovation
Most CMOs approach AI through the lens of efficiency—how can it automate existing processes or reduce manual work? This perspective misses AI’s transformational potential entirely. The new CMO must understand AI as a business capability, not just a technological tool.
Consider the difference between using AI for email personalisation versus deploying AI Agents Collective for individual customer orchestration. The former optimises existing processes; the latter creates entirely new possibilities for customer relationship management that were previously impossible at scale.
Future-focused CMOs recognise that AI enables “segments of few”—micro-cohorts that can scale down to individual customers whilst maintaining operational efficiency. They understand how AI Twins can create conversational interfaces that feel genuinely personal rather than algorithmically generated. Most importantly, they can articulate how these capabilities translate into measurable business outcomes that CFOs and CEOs understand.
- Understanding P&L Impact and Financial Engineering
Traditional marketing education focuses on brand building, customer insights, and campaign execution—but rarely covers the financial mechanics that determine business success. The new CMO must become fluent in profit engineering, understanding how every marketing decision impacts the income statement.
This means mastering concepts like customer lifetime value optimization, contribution margin analysis, and the economic dynamics that drive Rule of 40 performance. It requires moving beyond campaign ROI to understand how marketing activities compound over time to strengthen business fundamentals.
As one Fortune Brands CMO noted in the McKinsey research: “The relationship between the CMO and CFO is critical to the success of a business… CMOs have to put forth the right data, work on the relationship, and build trust.” This isn’t about learning accounting—it’s about becoming bilingual in both customer language and business language.
- Imagining and Storyboarding the Agentic Future
Perhaps most critically, tomorrow’s CMO must become an organisational futurist, capable of envisioning and articulating how business will operate in an AI-native world. This requires moving beyond current constraints to imagine entirely new models for customer interaction and value creation.
Picture the agentic future: customer AI agents that understand individual preferences, shopping habits, and life context, interacting seamlessly with brand AI agents that can access real-time inventory, personalise pricing, and coordinate experiences across multiple touchpoints. In this world, marketing becomes less about interrupting attention and more about enabling intelligent discovery.
The CMO who can storyboard this future—showing how AI agents handle customer service, how predictive systems anticipate needs, how cooperative networks eliminate platform dependency—becomes invaluable to forward-thinking CEOs. They’re not just reporting on current performance; they’re architecting the company’s competitive advantage in an AI-transformed marketplace.
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The Who – 2
AI as the CMO’s Golden Opportunity
The convergence of AI capabilities with marketing’s customer-centric mission creates an unprecedented opportunity for CMO elevation. For the first time in decades, CMOs have access to tools that can deliver the systematic, measurable, profitable growth that CEOs demand.
Unlike previous marketing innovations that required CMOs to become specialists in specific platforms or tactics, AI enables CMOs to become integrators and orchestrators. They can focus on strategy whilst AI handles execution. They can personalise at scale whilst AI manages complexity. They can optimise for profit whilst AI ensures operational efficiency.
This represents a fundamental shift from the Performance Marketing era, where CMOs were constrained by platform limitations and measurement challenges. AI removes these constraints, enabling CMOs to operate at the strategic level where they can have maximum impact on business outcomes.
NeoMarketing: The CMO’s Comeback
The McKinsey research documents marketing’s decline from “the growth engine of every company” to a fragmented function often disconnected from business strategy. But this decline creates opportunity. CEOs are actively seeking growth solutions, and the fragmentation of customer responsibilities across multiple roles has created operational inefficiencies that smart CMOs can solve.
Companies with a single customer-oriented role in the executive committee see “up to 2.3 times more growth than those with multiple roles.” This isn’t coincidence—it’s evidence that customer focus requires dedicated leadership, and CMOs are uniquely positioned to provide it.
The CMO who masters AI capabilities, speaks fluent P&L, and can articulate the agentic future becomes indispensable. They’re not just marketing leaders—they’re business leaders who happen to specialise in the most critical business function: systematic customer value creation.
From CMO to CEO: The Leadership Pipeline
The ultimate validation of the CMO’s strategic evolution is the pathway it creates to CEO succession. CEOs increasingly come from functions that demonstrate systematic business impact, and CMOs who deliver Rule of 40 performance through profit engineering position themselves as natural candidates for top leadership roles.
Consider the CEO who understands customers intimately, speaks AI fluently, and has demonstrated the ability to engineer profitable growth systematically. This combination of customer insight, technological capability, and business acumen represents exactly the leadership profile that boards seek for navigating an AI-transformed business landscape.
The Moment of Truth
We stand at marketing’s inflection point. The tools exist to transform customer relationships and business economics simultaneously. The methodologies are proven. The technology is available. The only question is whether CMOs will seize this moment to reclaim their strategic relevance.
The choice is binary: remain tactical executors optimising within constraints, or become strategic leaders who engineer the constraints themselves. The CMOs who choose the latter won’t just transform their marketing organisations—they’ll position themselves as the growth leaders their companies desperately need.
The age of NeoMarketing isn’t just about better customer experiences or improved campaign performance. It’s about CMOs reclaiming their rightful position as the architects of systematic, sustainable, profitable growth. The technology exists. The opportunity is unprecedented. The only question remaining is: Will you be the CMO who leads this transformation, or the one who gets left behind?
The golden age of marketing leadership begins now.