Chief Marketing Outsider Blog

In a recent study we conducted here at Chief Outsiders, LLC,  a poll of C-level executives from mid to large enterprise provided some insight into why Chief Marketing Officers have limited tenure in their roles. #1 Reason: CMOs rarely gain credibility with the C-Staff. Is this a result of issues with the individual or the marketing function itself? In either case, 2010 is the year of marketing needs to gain credibility. For the sake of CMOs everywhere. And their businesses.

But how? Certainly as more companies recognize the CMO role as “Chief Metric Officer” with a growing mountain of online and social marketing data, CMOs have the opportunity to step it up. But is there more to it than campaign and brand management where much of this data is related?

Perhaps the more credible and long-lasting CMOs will be those who can work side by side with their C-level peers in establishing business and operational strategy. While many companies view the marketing function as how a company “goes-to-market,” or how a company and its products are perceived in the marketplace, a more holistic and frankly traditional approach may better serve the company, and the CMO. This broader view of the marketing role includes the very identification of market opportunities, product gaps and needs, segmentation of targets, product definitions, strategic alliance strategy, product line consolidation, pricing, channel strategy, etc.,  AND getting everyone on board.

Why is the CMO role so rarely inclusive of this scope? Largely because these broader functions exist all or in part in other areas of the organization when they arrive. And frankly, finding an executive with the talent to lead all of these areas with the proper experience is very difficult. As a result, it will fall on the CMO to be the collaborator across functions to generate the synergy to move “all” of marketing forward. In this process, the CMO has the opportunity to demonstrate his/her orientation around market data (vs. asserting market instincts), alignment to business objectives, and eagerness to work with C-peers in finding innovations for marketing success.

The CMO must not only turn available data into actionable insights, but must build the credibility to bring alignment across the entire organization in order to execute the marketing strategy and business goals. This requires a deliberate investment, to gain the needed credibility. Failure to work collaboratively across executive domains will result in eventual dismissal. But the CMO’s willingness to lead the cross-company marketing domains, driven by insights and analytics, arm-in-arm with C-peers is perhaps a formula for gaining credibility and extending the value the CMO position brings to the business.

As an avid trail runner, entrepreneur, and Chief Marketing Outsider, I wanted to pass on a few interesting observations from my experience. This past weekend, I ran a 50-kilometer trail run in the depths of the Texas rough country. The race is known as Bandera, A Trail Run of Rugged and Brutal Beauty where everything Cuts, Stings, or Bites. The winner of the 100k race, Nick Clark, wrote an excellent RACE REPORTabout his experience.  The stakes of this race were high. There were 2 invitations being offered to Bandera’s top two finishers for the Olympics of ultra-running, the Western States 100 mile run.

Nick's explanation of what it took to win the 62-mile race applies very well to what it takes an entrepreneur, management team and the chief marketing officer to win in growing your business.  

First, winning does not preclude you from taking it in the chin during the race. As Nick explains, “As I sit here writing this report after a long day of travel, my feet continue to throb from the thousands of pokes, jabs and stabs they took in the hill country of Texas yesterday.” I only ran the 50k and my feet and pride are still beat down.

Second, there will be times when you need to make a pitstop, to refuel, offload and change tactics. If the competition passes you by, be patient. You will catch back up, but if you go back out too fast, you may crash and burn. In the words of the winner, “I had to stop and unload my early morning coffee, giving up 30-40 seconds on Dan and Chikare. I didn't bother trying to catch back up, realizing that there was a long, long way to go and the extra effort would be wasteful, so I just sat back and kept on the pace we had been running, getting visuals every now and then to confirm that I wasn't loosing any more ground.”

Third, when you make a wrong turn, do not forget the ultimate goal (winning the race). Be flexible, patient and Forgive. You might need to change your short-term tactics. “A mile or two down the track, we managed to miss one of the best-marked turns on the whole course … We turned around and headed back the way we had come, thankfully finding the turn sooner rather than later. Dan seemed pretty agitated by the mishap and upped the pace. I let him go, as we still had over 40 miles to race and I just didn't want to burn energy unnecessarily.” Dan ended up running out of gas and finishing 3rd missing one of the 2 qualifying spots for Western States.

[SIDE NOTE: As I came into the 20 mile aid station beaten up, sore, tired and over-trained from two months of running 5 marathons all too fast, I wanted to quit. Unfortunately, my coach and good friend showed up at the aid station at the exact same time. He looked at me and asked me how I felt. I said, “I feel terrible. I want to Q…”. But before I could say it, he told me to get back out on the trail, get out of the aid station and walk it off. The next 2 miles were HELL. Then after catching and stumbling with two other lost souls, my determination and spirit came back (it also might have been the 48 oz. of Coke I chugged 30 minutes prior).  The next 10 miles turned out to be my best. I wanted to QUIT, but I am sure glad I didn’t. This has served as a valuable lesson to me moving forward. When you feel your worst, keep going. There is a rule in ultra-running, “It Almost Never Always Gets Worse”. ]

Finally, good ole solid hard work is critical to victory. In the final few miles of the race, Nick just outran the #2. “And so it was, on Lucky Hill, the gnarliest and steepest climb of the whole course that I finally got a sight of Chikare's blue singlet. He was working very slowly up the hill, which was all the motivation I needed…I got my hands on my knees, hunched forward and broke out a super-hard power hike…By the bottom of the drop I had a solid lead and continued to push on the flats taking a few quick glances over my shoulder with nothing in sight behind… I came through the finish, throwing out a few high fives, in 9:16 for the win, a new course record and a date at The Big Dance in June. Mission well and truly accomplished.”

Nick’s race report is inspiring to me as a runner and as a marketer. There will always be great runners out there trying to beat you. The marketplace is usually filled with rocks, snakes, cactus, and unforgiveness. The difference between winning and falling behind is about preparing a good strategy, sticking to your plan, being adaptable to change short-term tactics when necessary AND having the patience and faith that you will eventually catch up over the long-haul. And with hard work, you will be able to beat your fellow competitors. Nick did out run the entire field to set a new course record. His strategy was excellent. His execution stuck to the plan. And at the right moment, working harder than the competitors pays off.

Please share your race stories and epic battles? 

Welcome to 2010! As I sit in the freezing cold, I crave being on the golf course. It occurred to me that the Social Media craze reminds me of the golf technology revolution. When the new metal driver came out and then the revolutionary Big Bertha Driver by Callaway appeared, Golf changed forever. But, did it actually make golfers better? More specifically, did golfers’ scores go down? 

I assume that the new technologies did increase people's drives off of the tee, (it extended reach), but did it lower scores? 

I wanted to pass along an interesting article about the top 10 B2B (Business to Business) Marketing Trends of 2010. Six of the top Ten revolve around social media. I will let you make your own conclusions from this article. The author does a great job of trying to explain the myths and expectations from it.  Social Media reminds me of Golf. There is a lot of hype and talks of Social Media saving strokes (meaning... at the end of the day increasing companies revenue and profitability and most importantly free cash flow), but does it?

The difference between the #1 PGA TOUR player in the world and the one who does not get invited back the next year is less than 2%. In 2007, the #1 PGA TOUR player in the world, Tiger Woods, stroke average per 18 holes was 67.79. The last player to make the cutoff, #120 Kent Jones, stroke average was 71.08. Less than 2% (3 Strokes) cost Kent Jones over $10.1M in earnings. The evidence suggests that we CANNOT leave any strokes out there. 

BUT...does Social Media add or subtract strokes? Let’s look at the best golfers in the world and ask the same questions. Does new equipment and new tricks (LinkedIn, oversized clubs, blogs, tricky putters, facebook, better golf balls, SEO) lower golf scores?

Arguably, the greatest golf championship in the world is the Masters. Reviewing the scores that won the Masters over the past 40+ years tells an interesting story:

• In 1964 - Arnold Palmer won by taking 276 strokes
• In 1965 - Jack Nicklaus won by taking 271 strokes
• Between 1965 - 2008 - the average winning score was 279
• In 2008 - Trevor Immelman won by taking 280 strokes*
• In 2009 - Angel Cabrera won by taking 276 strokes*

DO YOU AGREE?

* Besides Ray Floyd that matched 271 in 1976, no one else even came close to matching 271 until Tiger Woods shot a 270 in 1997. In all fairness, in 2001, Augusta National increased the distance of the course from 6,925 yards to 7,290 in 2002 and then 7,445 in 2006. What happened after the change? The scores went up. One might actually make an argument that PGA TOUR players skill went down (PGA TOUR players today do not use the longer irons that were absolutely necessary just a few years ago to reach the greens). 

Dear Board, CEO, Founder and Chief Marketing Officer,

What role does your CMO play in evaluating M&A decisions? I was not surprised to read this week that the M&A market for 2009 and expected for 2010 is being lead by "Strategic Buyers". A strategic buyer is a company that is ultimately looking to grow its business and has come to the conclusion that it is cheaper to purchase/merge than it is to do it oneself or outsource. In your organization, is your CFO or CMO leading the charge on determining your growth strategy? 

According to the article, "Although the M&A market has been subdued in 2009, White says he's seen strategic buyers pay strong prices for carefully considered acquisitions. "In addition to the distressed deals, there have been acquisitions by strategics who are looking for niche, highly synergistic businesses..." he says. "These corporate buyers are looking to buy a technology to leapfrog their competitors or add a product line that will make them more competitive." 

A CMO has 3 roles in an M&A transaction that leads to growth:

1. Front-End Needs Analysis
2. Culture Fit and Strategy Alignment
3. Operational Analysis 

Front-End Needs Analysis: A CMO better be leading the charge on the front end to determine IF a company should build, buy or outsource BEFORE the CFO, Board and Management Team decides to merge or acquire. Those companies sitting on cash that want to take advantage of this market can choose to invest it to improve the operations and/or replace old assets (increase efficiency), invest it in internal growth (the marketing budget), or invest it in M&A activities. The CMO must be working closely with all parties to communicate to the management team, CFO and Board that the company needs to look outside the company for strategic growth BEFORE there is an opportunity. 

Culture Fit and Strategy Alignment: A CMO also has the responsibility to protect the culture and company's focus by making sure an M&A transaction is inline with the vision and future plans of the company (not a one off hail mary) and the cultures are a fit. Otherwise, the "good deal" becomes the pit of despair.

Operational Analysis: Finally, the CMO must understand and evaluate whether the operations can improve as a combined entity. Throwing an M&A transaction over the wall to the operations team is not fair play. In fact, in some organizations, the CMO's team is responsible for evaluating and modeling the true costs of implementing an organization into the current company. Whether it is the marketing team, finance team or operations, the marketing executive must be willing to sign off that the transaction will drive the expected growth, drive the expected profitability and drive the expected cash. 

What do you think? And why is M&A a CFO discussion and rarely finds itself into the marketing trade publications? 

Are you in the Pit of Depair? Tell us your war stories.  

I would love to hear your thoughts about whether any Chief Marketing Officer can become a CRO (oh yeah, I mean Chief Responsibility Officer) in an organization. More importantly, can any company truly reinvent itself to focus on all stakeholders when it was never designed that way in the first place? 

In Ad Age's Article, How CMOs Can Also Be Chief Responsibility Officer, it gives 3 tips on how to transition an Evil Empire to the Freedom Fighting Good Rebels: 

1. Be Real
2. Build Your Bench
3. Deputize Your Employees  

 I think you can read between the lines on what the Chief Marketing Outsider believes. "We must also abstain from doing evil..it will wage war against the soul” (1 Peter 2:12). While one arm is chasing Responsibility, the other arm is NOT abstaining from doing evil and that evil is waging war against the soul. This is the danger. 

Here is the true question, Can a Company Abstain from Doing Evil even if it establishes a CRO?

The AdAge article quotes none other than a GE executive. I am proud of all of things they are doing for good. But here is my question, has GE reversed the damage they did to the Hudson River? From approximately 1947 to 1977, the General Electric Company (GE) discharged as much as 1.3 million pounds of polychlorinated biphenyls (PCBs) from its capacitor manufacturing plants at the Hudson Falls and Fort Edward facilities into the Hudson River. Before you get defensive, answer this. Would you serve your children PCBs? If the answer is NO, then GE knew very well dumping this substance into a river would not be good. Ask anyone who loves the outdoors. Back on point, GE is not and did not pay for their sins. GE settled with the government to subsidize the cost of clean up. In English, basically GE made a huge profit off of the goods manufactured in those plants and did not have to pay for the entire costs. Yes, we must forgive, but did GE learn its lesson? Would the world, economy and environment be better off long-term if GE was forced to pay for the entire clean up even if it forced them out of business? 

Jump in, can a company or CMO reverse the damage? What role does a CMO / CRO play in reversing past sins? 

Our Chief Outsider describes the company and each CMO (Chief Marketing Outsider) that we place inside of your company. There are three primary reasons we aligned our company with this powerful icon.

First, we believe a few of the ancient tribes of our past exemplified how to build a powerful nation by ruling through strong fundamental core values and beliefs. These nations built such a strong foundation that each individual worked together without the need to be governed by a central leader. Instead, they distributed political power and had very little centralization. These strong nations all worked from the same core beliefs. Regardless of the situation, our team believes in the same fundamental core values that keep our vision and value proposition in alignment.

Second, our CMOs are experts in knowing the landscape and the environment. Our clients come to us when their success has put them in a place that feels like the Land of the Lost. When a successful organization reaches a place where its growth has slowed down and expansion is a must, they need a guide that knows the territory very well and knows how to learn about the market and the environment in order to gather the right customer data to determine where to go. The ancient natives were experts as guiding nations and people through the land of the lost into the land of the plenty. They knew the land, they lived off of the land, they were able to build the skills and translate their partner’s vision into a roadmap towards success.

Finally, we admire the ancient ancestors because they were highly skilled and experts in not only their knowledge of the landscape, but also how to maximize their own strengths.  The ancient ancestors were expert hunters, horseman, and stewards of the environment. We pride ourselves in delivering the world’s best CMOs who know their own strengths and weaknesses. Our CMOs are also very balanced. We believe that a CMO should spend time maximizing their entire life in order to provide the best work for our clients. You will find our CMOs mastering not only your business but also their personal passions including spending time with family, running ultramarthons, sailing, playing golf, cycling and more… We believe that a marketing leader must know themselves and their expertise in order to help our clients find theirs. If you want to learn more about our team and need a CMO to come in and talk about your future, please contact us.