This article is an edited version of a live discussion that took place at the Oxford University Future of Marketing Symposium. The panel featured Andrew Stephen, L’Oreal Professor of Marketing at Saïd Business School; Julie Kollman, Chief Research Officer at Kantar; Seth Rogin, President and CEO of Nucleus Marketing; David Radford, the former Chief Marketing Officer at Allianz, and Peter Tufano, Peter Moores Dean and Professor of Finance at Saïd Business School. The panel also took questions from an audience of MBA students.
Andrew: Where does marketing fit within the c-suite and the boardroom?
Julie: I absolutely, fundamentally believe that marketing is one of the most important – if not the most important – members of the board, because the CMO is responsible for driving growth for the business, and businesses are in the business of creating growth and creating financial value. The only way to do that is to convince more consumers or customers to buy your product or service. The fact that we are even asking this question is slightly concerning, because in today’s world growth is becoming harder to come by. Marketing, in my view, is more important than ever. Finding customers and convincing them to spend money on what you have to offer is more difficult than it’s ever been.
Andrew: A piece of research in the Journal of Marketing looked at 64,086 bios of directors of S&P 1500 firms. They found only 2.6% of those board members had marketing experience. So that might well be why we are asking this question… Seth, what’s your take on that stat?
Seth: That we are in trouble if we don’t change things fast! First, we need to step back and think about how the role of the marketer has evolved. If you went into marketing 15-20 years ago, it’s because you believed you could write a great creative line; you could understand some consumer strategy and you worked your way up. Our business as marketers was a lot more about who you knew than what you knew. These days, I think CMO is the hardest job in the industry. A marketer has to be head of technology and understand the future of data and tech; they have to be someone who understands the consumer journey; they have to understand how to fill that funnel at the top at all times, because it’s constantly draining. And at the same time, they fill an internal role: really the marketer is the soul of the company. Because they say, this is what our brand is, this is what our employees stand for… and so to me something big has to change. I’d be interested to see that research again two years from now.
Andrew: What do you think that number needs to be? David?
David: It’s more about how marketing-orientated the whole company is, I think. It’s great if marketing is represented at the top level in an organisation, but if the discipline is represented and the voice of the customer is embedded in strategic decision-making, then perhaps the right outcome has been achieved. Personally I think it should be a much higher percentage, and I’d be really interested to see how the performance of those organisations improves when you improve the degree of marketing leadership. The whole issue of whether marketers make a good CEO is an interesting one to explore.
Andrew: So if the boards aren’t full of marketers… who are they full of?
Peter: Over the last 40 years, if you looked at boards, you would find more marketers, I suspect. But the dominant narrative in boardrooms has been: Shareholder Value Maximisation. If that’s your dominant mindset, then you’re going to make sure your board represents that stakeholder. So it’s not a surprise, on the boards I sit on, mostly it’s lawyers (for compliance) and finance people. I think the pendulum is now swinging back to a central point: at the core of any great business is delivering great services and products to customers. And once you’re at that point, then marketers will become more important. I think the pendulum is going to swing a little bit further… to think about the broader set of stakeholders beyond customers, financiers, investors, employees… and there I suspect there is an opportunity for either marketing strategy or some other function to have a more dominant role in the conversation in the boardroom.
Julie: I find it interesting that there seems to be a disconnect between “doing marketing well” and “driving growth for the company (and better shareholder return)”. And that I think is what concerns me the most: if we don’t believe that growing the business is what drives financial value, and what drives shareholder return, then what do we believe drives it?
Peter: I think it’s different for different firms. Some business models think about efficiency as driving growth; in the consumer products space, I’m sure we can think of examples where “severe efficiency gains” has been the model for growth, or increased value. But you’re right – if it’s not coming from satisfying (more) customers, you have to wonder about how sustainable that growth is. Because you can’t get costs down to zero.
Andrew: In that study, they said: “The findings suggest the common practice of not including experienced marketers on boards of directors put firms at a competitive disadvantage.” That’s based on the presence or absence of marketing-experienced board members (MEBMs) compared to shareholder returns and revenue growth, and that showed positive effects. Here’s a quote from AdAge: “Some boards have simplistic views of marketing as the ‘fluffy stuff’.” David? Have you had to deal with that?
David: I’ve certainly had to deal with that in the past! I think there’s a balance required. The marketer, to operate at a senior level, needs to embrace the role of director in the full sense, and demonstrate marketing as a means to an end – benefits to shareholders, or whatever the organisation’s objectives are. Marketing as a discipline should concentrate a bit less on its own level of self-confidence and more on the outcomes it’s seeking to drive. That’s the first thing – to get serious. At the same, I imagine many traditional board structures are not always benefiting from a real diversity of thought and different perspectives. Sometimes, it might be the marketing function that brings in that customer view – which is perhaps a long way from the more traditional leaders of the business who developed up through seniority etc. Marketers can act as the customer conscience of the business, at that level, which I think is a really valuable function. There is the element of “Marketing will now bring in the light entertainment spot!” in the meeting, and that’s something to rail against.
Seth: I like to be the provider of light entertainment! How do people self-identify within their careers? My bet is that a lot of the people who answered that survey do a lot of marketing work but don’t own up to it, because the perception amongst many legacy companies is that it is the “fluffy light entertainment”. But their understanding of what that role MEANS has not evolved as the job has evolved. And that’s why I think the pendulum is going to swing, as Peter says. That sense of not wanting to self-identify as a marketer represents a lack of understanding of the power of the marketer. If you look at the most successful, most cash rich companies that own the market today, the marketer has an extreme senior role. Look at Angela Ahrendts at Apple, who has transformed a business that no-one even thought needed transforming! And yet has catapulted that business. And the most successful ones have the strongest marketers either at the top or speaking to the top on a regular basis and really defining the culture – changing what the product is, changing how the product is represented.
Andrew: It’s about a marketing mindset as opposed to the job description per se. Thinking about the customer, caring about the customer, being that voice that David’s talking about. Having that marketing sensibility as opposed to “I’m a marketer, I’ve always been a marketer, I’ve done these marketing jobs and now I’ve risen to the top”… that might be part of the paradigm shift that we need.
MBA STUDENT: You talked about how entire companies need to adopt a marketing mindset. Do you think there are mindsets that marketers need to adopt to succeed within the C-suite?
David: Definitely. One of the issues is one of level. Recognising the strategic contribution of marketing and understanding that it’s possibly the thing that, at a senior decision-making level, people are interested in. And the tactics are perhaps less relevant. The second thing is language. The language that marketers need to use – to Peter’s point – has to be the language of the organisation’s key objectives. What are the shareholders and stakeholders interested in? Possibly not the KPIs that marketers are looking at a tactical level.
Peter: In a number of board/top team exercises, often you go through this process of trying to get everyone to “take their hats off” before they come into the room. So they are not coming in as the marketing expert, the operations expert, the finance expert – but as the senior team for the organisation. Part of the problem – based on my small window into this – is that many people have a perspective on the customer. In a boardroom, a lawyer will say, in financial services industry, “We have fiduciary responsibility to the customer” – and that’s definitely speaking to customer needs. A portfolio manager will say “I think what the customer wants is this” – that’s the operations piece. Many people have legitimate views about what it takes to satisfy the customer, whether minimally in terms of legal requirements, or maximally in terms of marketing. So to that extent, we should all be marketers. Having said that, to David’s point, how do you express marketing stuff to a broader audience? One of the critiques of my CV when I was a finance professor was that I did more marketing than I did finance (Why is that consumers respond to performance data in the way that they do? Why is it that they buy certain kinds of financial products and not others?) It was not seen as core to finance to understand how people buy products. You need non-marketers to speak marketing lingo, or at least be sensitive to the needs of customers, and you need marketing people to be able to understand, for example, where the value proposition is great but the operations to produce it are more complicated.
Julie: A key role for marketing is making sure that the organisation is staying future-focussed. Not just maintaining the customer base today and making sure that that’s growing, but what’s next? Taking that 5 to 10-year horizon and saying “What do we need to be preparing for?” That’s a really important role that marketing should be playing at the board level and it can demonstrate that they understand how to drive shareholder value for the organisation.
Seth: Julie I think you have it dead on. To me, the great divide between people who lead teams and people who lead entire organisations, is the ability to stop complaining about the product you have, and start creating strategy to market the product that you have. It’s very easy to say, “I wish my product also hovered in the air and spun”, but not everyone’s product is going to do that. So they say, “I can’t produce results if my product doesn’t hover and spin!” But the smartest marketers are able to look at the product they HAVE and accentuate that, but do it in a way (at the C-level) that takes ownership of the financial needs of the company – because without that, no one’s employed. It’s a very rare person who can balance those things. And because none of us are born at the C-level, it takes time. A marketer brings a sense of customer agitator – without being agitating – to speak up for that voice. Because there is the temptation to always manage ONLY the finance, and the marketer can often be the other M – chief mission officer.
David: Sometimes the marketer’s perspective is a really useful one for a CEO, because there’ll be questions they will be thinking about in terms of, to Julie’s point, forward-looking things… where do they get the main beam headlights for the car driving along at night; where do you get that forward perspective from? Issues of brand, of culture, of engaging people – these are all things that marketing contributes on. The challenge is that, as the breadth of the scope extends, to almost justify having a marketer at the C-suite level, there is a risk that you lose sight of the core function of marketing, which is creating distinctive products and services, that you understand a customer is looking for or potentially could look for. There’s a balance to be struck.
Seth: I was talking with the chairman of one of the largest retailers in the US recently and he asked his team of merchants why they hadn’t sold more raincoats in the last year, and they reported back “It isn’t raining as much.” And he said, “For the salary of one CMO, I can afford three weathermen.” It has to be someone who is able to look beyond the actual and see the strategic.
Andrew: I like to talk in terms of disruptive growth. It doesn’t have to be ‘the marketer’, but the person with the marketing mindset, the customer mindset, in that group, who is pushing that boundary – thinking ahead, down the road, not just what’s in the headlights but actually what the GPS is saying, because it’s way way way down the road. It’s probably not one person. The scope creep that you’re talking about David: it sounds like there should be a chief product officer as well as a chief marketing officer – or a chief customer officer? But then we get into that thing where there’s a chief of everything. How do you deal with that? There’s got to be some optimal point where it’s not everything and so broad, but it’s not so narrow that it’s not only seeing what’s immediately in front.
Julie: If we believe that the chief marketing officer is the person responsible for ensuring that the company can continue to grow, there are lots of different things that must happen to make that happen. That doesn’t necessarily mean that the chief marketing officer has to be the expert at doing all of those things; they need to orchestrate a team of people who can do those things. And I wouldn’t say that the person who’s responsible for the overall strategy for growth should be at the same level as those responsible for delivering one pillar or one tactic to achieve that growth. So I don’t think you need a chief customer officer, you don’t need a chief product officer, you need to put the ownership and the accountability for growth in a place and let him or her figure out how to orchestrate the team to deliver that.
AUDIENCE QUESTION: Do you think we need to position marketing in a different way? Change the narrative so that customers actually trust marketing people, and then maybe marketing will be incorporated into the C-suite and boardroom in a better manner?
David: You raise an important point about the strategic level. As a consumer, I am less suspicious of a brand’s motives if I know what the corporate “reason for being” is, if you like. I think there is a role there for the marketer at a senior level to try to influence that; to say, this is part of our overall brand offering, that we signal to our consumers what we stand for and what we don’t stand for, what we’re about and our reason for being.
Julie: Regarding respect in the boardroom: if a CMO goes into the boardroom and just shows the ads, why would you gain respect? If they go into the boardroom and say, “This is our strategy for how we’re going to drive growth, we’re going better satisfy consumers’ needs, we’re going to be able to do it at a price premium so we become more profitable…” then you have the respect that you’re looking for. I think that’s what’s most important.
Peter: Back to the pendulum. There is, at least at this school and some other places, this notion that the pendulum is swinging to a place where greater corporate purpose will be acknowledged. As corporations move in that direction, growth will be still important, but other things will become equally important. Marketers tend to know a lot about customers. These other considerations are about non-customers. So the question is: who’s going to own that space? In a boardroom, in a C-suite, where we talk about meeting the needs not only of the people who buy our products and our regulators, and our investors, and our employees but also all these consumers who are not really our customers but are affected by our products… that voice is not in the boardroom yet, other than through lawyers. How that voice comes in, and whether marketing co-opts that voice – because you’re really good at knowing what people think – I don’t know. To the extent that you know about non-customers as well as you know about customers, I think you stand a better chance, especially for the type of organisation that has a bigger voice in important conversations.
Seth: I keep wondering why an industry based on being the most powerful storytellers on earth fails miserably at telling its own story. We count on marketers to persuade the consumer, to do everything from eat healthy to not so healthy, to travel, to consume, to make million or billion-dollar decisions… and somehow marketers do the worst job of telling their own story. That’s where I think there’s such a powerful opportunity in a discussion like this and in a program like this – this industry needs to do a better job, and it will not be the current generation that does it. It’s going to be the generation that comes next, because it will represent the idea of marketing as science and not just marketing as art. It will represent marketing as strategic and mission-orientated and in understanding the power of persuasion and the power of mission.
I sat at a table recently with ten C-level ad agency execs and asked them all, “What’s the one thing that keeps you up at night?” They all said talent. The only thing they sell as ad agencies is the power of the human thought, and the energy behind that. The technology can be purchased but getting talented smart people… that’s everything they’re looking for. I think the only way we’re going to grow as an industry is if the next generation does a better job of telling that story.
MBA STUDENT: You mentioned that in the past probably we had representatives in the C-suite or boardroom. At what point did this switch to what we have today?
Peter: In the late 1970s when I was getting out of college, going into financial services, going into advertising, becoming a brand manager at Procter & Gamble… these were all equally important, valuable and coveted positions. People died to be product managers at P&G. Steve Ballmer, [former CEO] Microsoft – his first job was product manager at P&G. But if I was to poll our MBA students and say “How many of you want to be brand managers? How many of you want to go into advertising? How many of you want to go into finance?” Those numbers have changed dramatically. I think it’s partly about compensation; compensation differentials can be 10x easily. And in part the narrative, the story – we need to change that narrative in order to help people find the things that they love doing, as opposed to the things that pay the most. It’s maybe a mercantile answer, but I think there’s some truth to it.
Julie: I would completely agree with that, and I’d also say there’s a perception of influence that comes with that. And maybe it’s a circular argument. But people tend to believe if you go into a financial career, not only will you make more money, but you’ll have the opportunity to influence more and to see more tangible results of what you do on a day-to-day basis. I think that’s where marketing also suffers in terms of its narrative.
David: I’d agree with that, but I also think it is a great time for marketers. If you look at the changes in the environment that marketers are (and will be) operating in, there are some incredibly important causes and opportunities for marketers to make a difference in society that are not really commercial, not really driven purely by the amount of salary someone’s going to get. It’d be interesting to put it to the room; increasingly people coming from business schools are looking for something for more meaningful, more fulfilling and frankly more fun. Marketing needs to get back some of its mojo and get on the front foot! It’d be nice if there was tenfold increase in salary… but genuinely I think it’s a really exciting time for marketers, in many respects… as Julie says, as the orchestrators of a whole range of other experts as the business moves forward. Because I’m not quite sure who else is going to do that; as you say, there is a gap potentially for that role.
MBA STUDENT: I’ve read that on the Amazon board they have an empty seat, and that is the “customer”. They leave it empty every time that they meet. I think that says something about marketing not being a department and being something that everyone on the board does. How can marketing better influence the CFO etc. to think more like a marketeer and from the customer’s perspectives? What should we be doing? (Less about getting us on the board and more about making the company more customer-focused overall.)
Julie: Part of it is going back to the basics of reminding people what drives the financial performance of the company. And what drives the financial performance of the company should be better satisfying customer needs, satisfying them in such a way that we can premiumise our offer, at a better price point, and I really think that linkage has been lost in the day-to-day conversations that are happening at that level. It’s become much more about cost engineering, more about “Should we buy back our shares?”… not that it shouldn’t be those things, but it’s not only those things. If we can re-establish that link, I think that would be critically important.
Seth: I also think we’re entering a time of renewed commoditisation of products. With smart devices, with voice ordering (which we know is in early days but will improve) – that is going to make the role of the marketer exponentially more important. It should strike fear in every C-suite that has a packaged good that can be ordered online. I had a mentor who taught me early on that any time you feel that fear, it’s a butterfly you’re supposed to chase. There will be brands that will wither and die because they do not brand correctly in what I call the “shelfless society” – that’s what’s coming next. I’m not going to walk through the store, I’m going to be able to order everything from my home, as it becomes more ubiquitous and easier… so there’s an opportunity for the marketer to seize more of that customer voice and understand how it’s going to evolve, but also to incentivise customer behaviour in ways that have never been done before.
David: I also think there are more ways available today to bring that voice of the customer physically into the meeting. If a CFO or CEO should actually regularly be in contact with the sharp end, with the customer… that’s now possible through digital channels, even if it’s not a physical experience in store. And equally, stay in touch with the people in the business who in turn are closest to the customer. We all know the leaders of businesses who are inspiring because they have that immediacy, that relevance and connection to the customer, and that’s something that marketers have to make sure is happening. It’s in their interest to make that happen, both for the orientation of the business but also for their own ends in terms of getting their own objectives across.
Peter: I have a question for all of you. Over the last many decades we’ve seen the increasing power of the channel over the power of the product. Channels have become more concentrated: Financial service channels for sure, buying channels. When channels become more concentrated, your direct link with the customer becomes attenuated. And the voice of the customer is harder to hear. So how do you get the voice of the customer in the room when the distance between you and that customer is getting bigger? Controlled by somebody else? How do you keep the voice of the customer in the empty seat?
Julie: That is the challenge, and one that clearly we at Kantar are talking about on a regular basis. It’s so many different things. Yes I think the distance between you and your customer, because of the way the channels will start to work, is going to become a problem… but I think that’s also where we have to remember that, in a lot of industries, we’ve never been able to rely on that direct link with the customer. If you sell soap, you’ve never had a direct link to the person that’s buying your product. Today, when so many industries have MORE of a link, we’ve forgotten that fact. We knew how to market back then. We just need to revise those principles and remember that if we talk to consumers and understand them as people and understand their needs and motivations, rather than just relying on their purchase data, we can still win with them. We can still hear their voice.
Seth: I think it’s about understanding the power of persuasion and that it changes over time. I’ve been in this industry I won’t say how many years, but there’s never been concrete beneath my feet. Constantly the venue has been changing, from a print business to a digital business to a mobile business to a tablet business… to something that’s read online and audio… and that will continue to change. I’ll be stunned if it doesn’t. The most important thing, and this affects most of us who are in the C-suite and looking to HIRE marketers, is that you’re looking for someone, to Andrew’s point, who doesn’t just see around corners but is creating the next one. And that ability to do that, to spin all those plates while also delivering a short-term result, is key. And when we’re looking at the people who have those proficiencies, that’s who’s going to create that next wave of results that we need.
MBA STUDENT: The challenge now is that you only get so much time in front of a customer when you do get them. I also hear the trends that Dr Tufano was discussing with becoming more purpose-driven organisations. Do you see that being mutually exclusive when you get in front of a customer? The importance of quality of your product then quality of your brand and valuing that chance that you get in front of them?
Julie: When social purpose works, and works well for a brand, is when it fundamentally supports what the brand wants to stand for, not just from a social perspective but also as a brand. What its competitive difference is, what its competitive advantage is, what it does for the consumer. If you have a brand proposition that is something different from the social purpose you’re espousing, it’s going to be too much of a disconnect for the consumer and they’re not going to understand. When they’re intricately linked, then it is incredibly powerful; you’ll capture their attention, you’ll become extremely memorable and you don’t need a lot of time to establish your message. And that’s really difficult to do but when it’s done well and done right, it’s brilliant.
Seth: I would encourage you to look at the most winning campaign of 2018. At the Cannes Lions, at the Pencil Awards, and it’s probably something you haven’t seen. But it won three titanium Lions. The odds I believe of winning a single Cannes Lion is 0.04% when you enter, and this place won three. It’s the island nation of Palau – just south of the Philippines. They had an environmental tourism ad campaign that has driven tourism but also driven awareness of their environmental issues. It was created by Havas in Australia. When you visit Palau, you actually get a stamp in your passport that you have to sign, the “Pledge for Palau”, saying you will not hurt the environment; you will pick up plastic if you drop it. First of all, it is a beautiful work of art as commerce – the campaign is magnificent and to win both creative awards and business awards takes a lot, in the same year. But the fact that it is the winningest campaign of the entire year says: what you’re asking is exactly the right question. Probably there are people here who haven’t heard of that country, and yet it’s winning global awards. It says to me, you can establish a brand, in this case an eco-tourism brand, with a very simple message. For them, it was “come here, enjoy how beautiful it is, and don’t hurt it while you’re there.” And it won awards throughout the planet.
Andrew: Final thoughts?
Peter: I think marketing’s really important. It is one of the most important functions in business, but it has not necessarily got the attention or stature it should have. But to hark back to those last questions, to the extent that you want to make businesses act more responsibly, to be more purpose-led, then the marketing function is probably pretty critical to that, because it’s not going to come out of accounting or finance. It may or may not come out of operations and their ethical supply chains and other sorts of things… but the natural place where some of those ideas would come from, and certainly the narrative to support them, would be marketing.
David: I’d echo that and maybe qualify it slightly: I think that social purpose could come from anywhere, but arguably the marketer is best placed to amplify that and really make it part of the culture of the organisation and make sure, to the other points, that it rings true right through your experience of the organisation. I would absolutely endorse the point that the time for that kind of initiative has really come now, particularly linked to the environment. I think so many organisations are recognising that, and there’s a real opportunity for marketers to get involved in that – and ask the difficult questions. One of the great roles of marketers at this level, where they can add value, would be to ask those challenging questions. And I suspect many CEOs would thank them for doing that.
Seth: I always wonder what drives someone to be a marketer. There’s nobody here who, when they were five years old, dreamt that they were going to be marketing products for their financial advancement. And yet something happened within our lives where we realised that we had this ability to be persuasive, to apply technology, to make the world better… all not just from a sense of mission but also from a sense of your skills. So if what you care about is making companies be more mission-orientated, then the marketer drives that. If what you care about is seeing financial growth, then marketing provides that. Marketing is the engine of the change in every industry. I want to answer the question – where does marketing fit within the C-suite and the boardroom? Securely. It needs to be there in every single organisation and I think it’s worthwhile for you to follow up on that study in a few years and see if that 2% hasn’t become 20% because I believe it will.
Julie: I’ve been doing marketing for 30+ years and I’ve never once regretted that decision; I’ve never once had a moment where I thought I wasn’t doing something that was important for the corporation that I belonged to. I absolutely love it and I think everyone can have an amazing, successful, and very fulfilling career in marketing.
This article is an edited version of a live discussion that took place at the Oxford University Future of Marketing Symposium, for the Future Proof podcast.
Future Proof is the marketing podcast from Saïd Business School, Oxford University, and Kantar, the marketing insights and consulting company. In each episode, we have a frank discussion with industry experts, to help brands and business leaders navigate the changing landscape of marketing… and hopefully dispel some myths and misconceptions along the way.
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