“Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business,” said Peter Drucker.
If marketing is the unique, distinguishing function of business, as Peter Drucker says, then it’s is a pretty bad state, according to a recent survey by Gartner.
With corporate growth far and away the number one strategic business priority for the 400+ CEOs surveyed – 56% named growth, followed by 36% saying technology – their investment intentions are upside down. Over 80% said increasing their company’s digital capabilities is tops and only 46% rated marketing for increased investment.
CEOs may give short shrift to marketing because they don’t really understand it. Numerous surveys find the CEO ranks are filled with people primarily from operations, finance and engineering backgrounds. Marketing executives are much further down the list.
Unfortunately, surveys don’t explain why marketing executives rarely rise to the top. But it would seem people from operations, finance and engineering are grounded in the facts-and-figures that guide the business process, unlike the “smoke and mirrors” world of marketing.
And because CEOs lack an insiders’ understanding of the marketing function may explain why 80% of CEOs surveyed by the Fournaise Group said they don’t really trust the work done by marketers versus 90% who trust and value the work and opinions of CFOs and CIOs.
Marketing = Growth
Nonetheless, if growth is priority number one for CEOs then they ought to put their money where their mouths are and invest more in marketing. It will be even more critical in 2022 for CEOs managing companies in consumer products and services businesses.
A Deloitte CEO survey conducted early this year found CEOs targeting the consumer market were far less confident of growth than those in other industries.
Over half (54%) in consumer-facing businesses expect only modest to weak growth, the lowest among the six industries included in the survey. By comparison, an average of only 29% of CEOs of technology, professional services, health care, industry products or financial services firms anticipate modest or weak growth this year.
Marketing grows your customer base. Marketing grows your market share. It’s results are measured on the top line of a company’s income statement, but its ultimate value goes right to the bottom line. The chief marketing officer boosts both by developing and implementing effective marketing strategies and tactics.
Unfortunately, many companies have an army of marketing tacticians – effectively marketing foot soldiers – but they lack that broader and infinitely more critical perspective of strategy – four-star marketing generals. That’s the role of the chief marketing officer (CMO).
Assuming you can find a CMO who has the expertise, wisdom and the breadth of experience that’s necessary to drive growth and profitability – and that’s a big if – they’re likely to cost a quarter-million dollars or more a year. That’s even before they start building their own departments.
And unlike other C-suite officers, they may not stay around long enough to make a real difference. An article in Harvard Business Review, entitled “Why CMOs Never Last,” reported 57% of CMOs have held their position for only three years or less. Their churn rate is much higher than that of CEOs, CFOs, and CIOs.
Hiring the wrong CMO – or the right one who doesn’t last – can turn into a very expensive and ugly experiment. Yet it may cost you even more in lost opportunities by not having the right CMO who has the skill set, depth of experience and strategic overview your company needs.
Or maybe you feel your company isn’t big enough yet to hire a full-time CMO, yet you are missing the contribution a top-notch marketing executive can bring to your top and bottom line.
It’s time for you to consider Fractional CMO. It will fit your budget better and it’ll give you exactly what you need with a far higher ROI.
Even better, The American Marketing Group provides a Fractional CMO program with three high-level executives with unique perspectives and strategic expertise, from research and branding to graphics and marketing technology. And we bring nearly 100 years of professional marketing experience across a wide span of vertical markets. Most CMOs have a far narrower breadth of experience.
We call it the Cerberus approach. In Greek mythology, Cerberus was the three-headed working dog that protected its master. And that’s exactly what The American Marketing Group can do for you.
Danziger, Friederichsen and Ramey – three heads and three perspectives with one goal: To ensure you penetrate your market to the max and drive record revenues and profits.
We offer a free 30-minute telephone consultation to discuss your marketing challenges and shortfalls and how our unique three-heads-are-better-than-one approach can help set things right in your company’s marketing. If you’d like to explore the opportunity, click the link below.CONNECT