In ambitious businesses looking to accelerate profitable growth, marketing is a key ingredient to commercial success with influence at Board level, and a powerful ally to the CEO. That’s a transformation from the outdated view of marketing where it was positioned as a support function and therefore largely seen as a cost centre.
What has led to this elevation in the role and influence of marketing? Growth Partners has seen firsthand the impact that senior marketing leadership can have on a business and in this article we explore what happens when marketing is put at the top of the business agenda.
Marketing Becomes an Engine of Growth
“CEOs who place marketing at the core of their growth strategy are twice as likely to have greater than 5 percent annual growth compared with their peers”. This was a recent finding by McKinsey following research on what drives growth in businesses. Having a place on the Board is one thing, but this research showed that it’s the relationship between marketing and the CEO that is crucial to success.
A CEO needs to:
- clearly define the role and scope of marketing;
- elevate marketing to a strategic function;
- champion customer focus; and
- encourage alignment with the rest of the Board.
In turn, it’s the responsibility of the CMO to demonstrate value creation and demonstrate the worth of marketing, making sure the Board has relevant metrics to show the impact on business growth.
When the relationship between the CEO and CMO is invigorated in this way marketing becomes a catalyst for success.
Customer Insights Drive Business Strategy
A customer focused strategy is a proven way of improving products, refining the customer experience, enabling personalisation, reducing acquisition costs and increasing customer retention. And this leads to long term profitable growth.
It’s the marketing team that has the information at their fingertips but in order to make proper use of it, the business as a whole needs to adopt a data-led approach. That means these actionable insights feed into the business strategy, not just the marketing strategy. It informs every decision from product development to sales to pricing to customer service.
Having marketing on the board means the voice of the customer is on the board and a data-led approach can be brought to life.
Product, BD, Sales, Finance, HR…Everyone Benefits
In businesses where marketing is siloed, it’s not only limiting what marketing can achieve, it’s restricting the positive impact that marketing can have on the rest of the business.
Marketing should be:
- providing actionable insight and qualified leads (MQLs) to sales teams;
- influencing product development with customer insights;
- assisting HR with building a strong and relatable internal brand;
- making sure the business has a unified purpose and can attract diverse talent;
- defining/developing and championing the brand;
- collaborating with finance on relevant KPIs to evidence impact on the bottom line; and
- driving marketing effectiveness.
The remit of marketing needs to be flexible, a forward thinking CMO will wear other hats within the business and perhaps fulfil the role of a Chief Commercial or Chief Customer Officer as well.
When marketing is elevated within a business and empowered to integrate with other teams a business can really start to create more blue water between them and their competition.
The Skillset of your Board Becomes More Diverse
A successful CMO will be both numerate (data, analytics, digital) and creative, with a high EQ. They will be able to think strategically and have a commercial mindset, be inquisitive and customer focused. They will have the gravitas, personality and strong communication skills to influence the board and bring them along with them.
These are the skills that marketers acquire along their careers and at the top of their game, it’s clear to see why a CMO is incredibly valuable to a business. They add breadth to a Board by complementing the other skillsets of established members and as a result are a strategically powerful member of the ELT.
When is the Right Time to Put Marketing on Your Board?
What is the business’ vision for the next five or ten years? What are those growth aspirations and is the organisation ready for change? Answers to these questions should inform the structure of the marketing team. Bring in a permanent CMO too soon and the role will not sustain.
We have had a number of businesses come to us after a marketing ‘mis-hire’ where the senior marketer was not properly embedded into the business, the scope of their role was not clear or a professional was hired at the wrong level for the business need.
Our advice to CEOs is to be open minded about what the marketing structure could look like. For example, high growth businesses might think they need to bring on a permanent CMO at Board level in order to achieve their business targets, but in reality it’s not the best solution.
A fractional CMO can be the right catalyst for change. They operate at Board level, provide rapid impact, are focused and have directly relevant experience to achieve transformative results. And at the end of fractional placement, the business has a clear vision for future marketing strategy which is aligned to the business’ goals. The business has made a short term investment in marketing to achieve clarity and direction for long term growth.
If you’re interested in understanding more about how a Growth Partner could move the strategic dial in your business, please get in touch.