For decades, the CMO role has been a mainstay of the executive suite. But now, many big companies are starting to cut or modify the CMO position, scale back and refine their marketing approaches.
Why is this happening? What are the alternatives? And what happens next?
Why Companies Are Cutting the CMO Role
There are several reasons why companies are starting to cut the CMO position.
Available Alternatives
First, companies are beginning to recognize that there are many available alternatives to having a full-time CMO onboard. For example, companies can now hire a “fractional CMO” on an as-needed basis. The fractional CMO functions much like a typical CMO, except they function as a consultant. If you want to work with your fractional CMO on a periodic or per project basis, you can do that. Companies can still access CMO experience and perspective without shouldering the burden of a full-time employee.
Some businesses are restructuring to have the CEO or CTO take on responsibilities for directing marketing campaigns. Marketing leaders and personnel are still important, but high-level direction can conceivably come from multiple places in the executive suite.
Unclear and Conflicting Responsibilities
Some of this conflict stems from seemingly contradictory responsibilities and misunderstandings about what the responsibilities of a CMO actually are. For example, many CEOs believe that a CMO should be primarily responsible for increasing revenue generation, but the perspective of a typical CMO is more focused on achieving marketing specific objectives.
A CMO might focus on building brand awareness and telling appropriate stories for customers, rather than finding the tactics that are most effective in securing new revenue for the business.
Overlap With Other Departments
Complicating matters further, it’s clear the marketing departments have at least some overlaps with other departments within the organization. Marketing and advertising are clear ways to increase revenue, but so is sales and focusing on customer experience. Sales, customer service, IT, and product development all share at least some common goal with marketers, and some CMOs are getting lost in the shuffle. It makes it hard for business leaders to justify continuing this unique role in some cases – at least on a full-time basis.
Expenses
CEOs need to consider the expenses associated with hiring and retaining a CMO. Executive leaders aren’t cheap, with adequately experienced leaders demanding salaries in the high six-figures. If you can’t clearly and objectively justify the expenses associated with a CMO, the natural inclination is to cut the position.
The Persistent Need for Marketing
While many businesses are rethinking the CMO position, very few are interested in cutting marketing and advertising. Marketing is still one of the most effective ways for a company to build visibility, gain new customers, and get an edge over the competition. Accordingly, we shouldn’t see the transformation of the CMO position as a loss, but rather, as a transformation of leadership structures and hierarchies within organizations. This isn’t great news for people who have built their careers as marketing leaders, but there are some ways that they can adapt to these changing times.
A Meaningful Evolution of the CMO Role
In addition to accommodating alternatives, CMOs and marketing leaders can survive in this environment by focusing on adapting the CMO position. If the traditional CMO role is becoming antiquated or no longer useful proportional to its costs, these are some of the most meaningful ways to transform it:
Focus more on revenue.
One of the best ways to salvage and rebuild the CMO role is to have it focus on revenue generation as a primary objective. If you bring in more money than you cost, you’re very unlikely to be cut.
There are many ways to increase revenue generation within the marketing department. You can focus on horizontal expansion, by pursuing new strategies, channels, and platforms, or vertical expansion, by doubling down on strategies that work and investing more money in your top performers.
If you aren’t sure where to invest or expand, it probably means you need to spend more time analyzing the data. Pay close attention to the performance of your past campaigns as well as the needs and desires of your target audience.
Clear delineation from other departments.
It’s also important to focus on how marketing is distinguished from other departments. CMOs need to focus on things that other departments simply can’t handle.
In today’s world, a sufficiently experienced CTO can take over many responsibilities historically associated with CMOs. While you shouldn’t perceive this as a threat, it is something you’ll need to guard against. Make it clear how the marketing department is distinguished – and accomplish feats that no other department can touch.
Collaboration instead of isolation.
At the same time, marketing leaders need to practice a collaborative mentality, working with other leaders within the organization to drive the business forward. CTOs and IT departments shouldn’t be seen as encroaching competitors, but as colleagues and supportive infrastructure that can exchange with you in pursuit of mutually beneficial goals. If you’re drawing information and resources from the entire organization, you’ll be much more likely to achieve the results you want.
Adaptability and evolution.
It’s unclear how things will develop, so it’s important to preserve a mentality of adaptability and ongoing evolution. The decline of the CMO role may be temporary, or a sign of further disruptions to come. If you remain adaptable, you’ll be poised to succeed in any conceivable environment.
Toward an Uncertain Future
It’s not exactly certain where the CMO role evolves from here. Most big businesses still have a CMO and have no plans on cutting the position in the near future. But, at the same time, viable alternatives and changing business values require us to reconsider how we approach marketing leadership. Marketing is important to businesses, so successful leaders will embrace and adapt to these changes.