Are You a CMO or a VP of Marketing?
What’s the fundamental difference between a Chief Marketing Officer and a VP of Marketing? It’s not a question of experience or organizational size, and it doesn’t matter what your business card says (mine says VP Marketing). It’s a question of how you act, the extent and scope of your responsibility, and how you are perceived by the organization.
According to the recent CMO Council report, Define & Align the CMO, the most successful CMOs bring a strategic long-term view, exceptional measurement and analytical capabilities, and financial management rigor to their role. These business leaders earn their seat at the revenue table and the respect of fellow C-level executives and board members.
Other senior marketing executives may excel at their function, with great experience building brands and executing programs. But without the skills to provide strategic and financial leadership to the organization, these executives do not deserve a C-level title. VP/SVP of Marketing describes their role just fine.
So, the question is which are you: a CMO or a VP of Marketing?
A Short History of the CMO
The CMO title was originally created by self-described “super-star” marketers who were good at marketing the job of Marketing and themselves, but not at driving revenue or demonstrating results. In a classic example of the Peter Principle (the tendency to rise to one’s level of incompetence), executives and recruiters sought out the marketers who were best at “traditional” marketing functions such as brand development and tactical program execution and elevated them to CMO.
However, according to the CMO Council, the hiring criteria for these CMO roles did also not include things like “business strategy, vision and corporate direction”, “budgeting and accountability of spend with CFO” or “sales, marketing and channel integration”. In other words, they were hired to be VPs of Marketing, not Chief Marketing Officers.
As a result, these CMOs were ill-prepared to operate at the same level as other C-level executives. They were used to operating tactically, not strategically. They were used to using soft marketing metrics such as brand awareness, not hard financial metrics like revenue and cash flow. The result was CMOs who lacked credibility, authority, or clout in the organization – leading to failure, short tenures, and high turnover.
The Modern CMO
To be successful, the CMO must play a role broader than just leading the marketing organization. The role must include driving revenue, leading innovation, and providing strategic vision. These growth champions must lead all four Ps – not just promotion but also product strategy, place (channel and distribution), and pricing.
Like other C-level executives, these CMOs must be rigorous in their financial planning and metrics, making revenue forecasts and justifying their budgets like the investment in the future that marketing spending really is.
Quant Jocks and Geeks?
Tim Furey, CEO of MarketBridge (co-sponsor of the CMO Council Study), shared additional findings about the modern CMO in a recent article in AdWeek:
So how do CMOs gain cred? Not by touting taglines but by crunching numbers, becoming “quant jocks” in the model established by CMOs at CapitalOne and Dell, then proving to their boards that their marketing is working, said Tim Furey, CEO of MarketBridge, Bethesda, Md.
CMOs with greater quantitative focus and measurement emphasis have a significantly longer expected tenure, “greater than 20 percent longer,” said Furey.
“The age of the rock-star CMO is going away,” said Furey. “We’re going into the era of the geek. Or, to put it another way, if you’re going to be the rock star, you’d better get some really good roadies working for you.”
…CMOs with agency backgrounds are being replaced by those with a broader career experience across several disciplines, “particularly sales management, product management, and in some cases even financial analysis.”
It’s never been harder to be a CMO, but it’s also never been as exciting. Today’s CMO is faced with the imperative to be accountable for driving revenue, the pressures of new and rapidly changing marketing tactics, and the need to build quantitative and analytics skills. At the same time, the modern CMO is finally beginning to earn the respect of the organization and a seat at the revenue table as a peer to fellow C-level executives.
So, the question remains, which are you: a CMO or a VP of Marketing?