Chief Marketing Officer Tenure Drops from 48 to 44 Months
High CMO turnover is a continuing trend in major US companies. While the average tenure has risen over the past decade (the average length of stay was a mere 23.6 months in 2004, compared with 48 months in 2014), a recent study released by Spencer Stuart indicates we may be approaching a down swing - last year's average CMO tenure clocked in at just 44 months (the first drop in a decade).
Why the short shelf life?
In the medical field, you know you're successful when your patients get better. In the legal field, you either win the case or you don't. The problem with marketing is that it's difficult to define, and often relies on varying measures of success. Marketing is one of those things everyone has an opinion on (in large part because of how public it is), and that opinion can hold significant sway over the perceived success of the CMO's work. The CEO also has a strong opinion, as the core of marketing is defining what value the company adds and the direction the company is going; no one has a more vested interest than the CEO.
Marketing as a profession has gone through many changes in the past 10-15 years, especially as technology has advanced. There are now many types of marketers, and their strategies may not align with the expectations of the company:
- Perhaps they were hired to support revenue goals or digital transformation, but the CMO's idea of successful marketing is turning the brand around.
- It could be that the CMO is accustomed to using the same approach across the board, but today's competition requires taking more risks, and the CMO needs to step up their game.
- Conversely, maybe the CMO has evolved beyond what the company is ready for, and taking risks becomes the nail in their coffin.
Another possible explanation is that CMOs are generally creative types, and with that comes more of a "rolling stone" mentality - spending more than a couple of years in one place can lead to boredom and the need for change. According to the Bureau of Labor statistics, today's average worker (industry wide) stays at a job for 4.4 years, so this may just be par for the course in a changing workforce.
What are the consequences?
- As with any industry, whenever a department head leaves there is the potential for people to wonder, "Am I next?" The risk to productivity is even higher in marketing, however, because the CMO is so closely connected to the company's brand. A company can handle some departmental turnover every 44 months, as long as it doesn't impact the brand, which could be catastrophic.
- The Bottom Line. How the brand is perceived by the public is everything. Again, it comes back to "everyone has an opinion," and chances are the CMO has spent some time changing the way the brand is viewed. Consistency is key, and if the brand strategy keeps changing every 44 months, the customer may start to lose confidence.
What are the advantages?
- Fresh Perspective. One benefit of high turnover is the ability to gain a fresh perspective. No matter how amazing your marketing team is, they're still dealing with the same information day in and day out - there's nothing like "new blood" to bring fresh insights to the table. If the CMO is a good fit with the team, that new energy can be contagious and invigorating - the breath of fresh air needed to blow the cobwebs off a stale project or concept.
- Multiple Skill Sets. Marketing is a blend of art and science. In a perfect world, a CMO would have a strong understanding of data and analytics, as well as a mastery of design and creativity. In reality, it's nearly impossible to find a CMO who is exceptionally strong in both. Higher turnover could be an opportunity to explore different strengths and skill that speak to both disciplines.
What are the alternatives?
The cost of replacing a CMO can be very high, in part because of their income level, but also because a CMO's shoes can be hard to fill. Not only do they have to have the technical skills and personality to mesh with the team, they need a philosophy and definition of success that is different from the last guy.
When you consider the high cost of replacing a CMO (headhunters, recruiters, and interviewing), the real cost of a 44-month tenure is closer to 55 months. It may make sense to hire a part-time CMO instead. Companies like Chief Outsiders address some of these costs, especially when you don't incur the risk of onboarding, severance packages and equity.
High CMO turnover is a real issue in today's marketing industry, but it may not be a bad thing. In the past, high turnover, or "job hopping," on a candidate's resume would raise red flags, indicating their inability to commit or get along with their coworkers - but times have changed. Today's companies know that a candidate who isn't afraid of change, and is brimming with curiosity, might be just the thing they need. And in today's project-based, contractor world, CMOs may also benefit from hitting the refresh button.