The role of a CMO today seems to be a high risk one- the average tenure is 44 months, the lowest among the C-Suite. To stay on, prove their value and mettle, CMOs need to put across a clear statement of how their marketing efforts are adding to the bottom line of their companies- and save their jobs, perhaps, even climb up the ladder.
But while it lasts, businesses don’t think the role of CMO is adequate to hold up the revenue part of the sky. So many are employing a Chief Revenue Officer, in addition to – or even instead of- a CMO.
The idea behind this is that the CMO is responsible for opening doors for sales, generating and qualifying leads, and the CRO needs to take this further. He or she needs to be able to grow the revenue, and expand the company’s financial base. Perhaps this is because it is commonly believed that CMOs, in their focus on marketing strategies, often ignore the objective of wider business growth, optimisation and retention. Their only focus is on the number of leads generated. That’s very critical to sales but typically, the Board does not attach too much value to these numbers. The important figures for them are ones in the balance sheet.
Most CEOs do not easily see the link between leads and revenue because their point of view is only on revenue growth and customer retention. So now, CMOs need to prove that marketing can support both opening the doors for sales and pushing them over the line. There is no place there for a CRO. Here are some ideas on how they can do this:
Understanding the leaders’ priorities
Revenue growth usually comes along with increased profit for a company, helping the business as a whole grow. But for the CMO, generating leads that will translate into customers is the focus, though this is not a direct revenue acquisition in the short run. But for those at C-level, the question always is – when will these leads convert into customers? And how many of them?
Till then marketing is a cost centre, and it is imperative that the revenue is higher than cost, and the bigger the gap between the two, the better. So to earn their trust, Marketers need to be able to demonstrate the impact of marketing on the revenue figures.
Convince them: effective marketing = revenue growth
While traditional marketing is hard to judge on a commercial scale, CMOs can create a correlation between the amounts of money spent, the leads generated, the leads converted and the incremental revenue that results. It’s not surprising that the C-Suite find the connection too cumbersome. It’s a difficult call, but showing the right and direct linkages may cause them to change their mind about the need for a CRO! It’s not difficult is to leverage marketing automation tools which will enable the CMO to create and map customer journeys, with a clear objective of revenue. This can help them to qualify leads, and showcase the efficacy of a marketing plan- even justify their role.
With technology on their side, CMOs can actually create a transparent marketing roadmap that leads to the final goal everyone on the Boardroom table wants to see- higher revenues. The CMO can thus share the information needed to prove their worth in the boardroom – keeping themselves involved, and the CRO out.