Survey Probes The 'CEO-Marketer Divide'

by Karlene Lukovitz, Nov 15, 2012, 5:17 AM

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Recent surveys of CEOs by Fournaise Marketing Group offer some sobering insights for marketers.

Fournaise, a London-based global marketing performance measurement and management company, surveyed more than 1,200 CEOs of large corporations and small and medium-sized businesses based in North America, Europe, Asia and Australia to probe the “CEO-CMO divide” as part of a 2012 Global Marketing Effectiveness Program.

The research found 80% of CEOs reporting that they are “not very impressed” with marketers, and perceive them to be “poor business performers,” according to Fournaise.

These CEOs indicated that they perceive marketers as: not being able to adequately prove the positive business impacts of their marketing activities; having “lost sight” of their core purpose of generating customer demand for products/services; and not being focused enough with their business performance. 

Delving further, the firm found 70% of the same CEOs admitting that they might be somewhat responsible for what they perceive as marketers’ poor performance.

However, these top executives said that they viewed their own responsibility as being purely the consequence of having steadily lost trust in marketers’ business abilities, and therefore having “given up” on holding marketers accountable.

The good news: 20% of CEOs surveyed view their marketers as highly effective and accountable, and as key strategic players. 

More specifics about the insights:

*Loss of trust:  69% of CEOs admitted that over time, they had stopped imposing specific business-focused key performance objectives (KPOs) and key performance indicators (KPIs) for marketers to achieve. 

 Main reason: They think that marketers have continuously failed to unquestionably and consistently prove in the boardroom that their marketing strategies, activities and campaigns generated actual business growth/customer demand for their organizations. They concluded that it was “useless” to continue defining and imposing KPOs and KPIs that marketers have difficulty relating to and achieving. Some of these CEOs actually said that they continue having a marketing department “purely out of tradition,” reports Fournaise. 

These CEOs also view CMOs as being outside of their internal circle of key business decision-makers (such as CFO, COO and CIO). They either rank marketers as low in their  organizations’ executive/management committees, or do not include them at all.

*Abandoning accountability metrics:  67% of CEOs admitted that they may be guilty of not holding marketers accountable enough (or at all).

These executives said that would like to be able to work with marketers who are “100% ROI- and performance-driven,” reports Fournaise. That is, marketers who can demonstrate that all marketing dollars spent across all activities, channels and media are tracked and optimized to yield measurable, direct positive impacts on the company’s P&L and operations, with minimal “waste.”

However, these CEOs also said that their experience has led them to conclude that “ROI marketers” are rare. They said that their own time challenges and frustration with “one-dimensional, traditional marketers” (whom they perceive as living too much in their own brand, creative and social media bubble) has caused them to give up pressing accountability issues with marketers. Instead, they have made a conscious decision not to expect more of marketing than “branding, look-good/feel-good ads and running promotions,” according to Fournaise’s summary.

*Reducing marketing’s responsibilities:  Going further, 64% of these “marketer-unhappy” CEOs report having over time removed one or more of three critical responsibilities from the marketing department’s traditional four core functions: product development, pricing and channel management. Some of their marketing departments are now in charge only of marketing communications. 

These CEOs said that they believe that product, pricing and channel management are so critical to the revenue and profit growth of their organizations that they need to be led by “more pragmatic, performance-driven specialists reporting directly to top management,” Fournaise reports. 

*“ROI marketers” are highly valued:  On the opposite side of the spectrum, 20% of CEOs view their marketers as focused on generating more customer demand; constantly tracking, boosting and reporting the actual business impact of their marketing spending on the company’s P&L; and working hard to minimize marketing waste.

These CEOs respect that their marketers accept having their performance judged on business-focused KPIs, including sell-in/sell-out, prospects, market share, marketing effectiveness and marketing ROI. 

Further, they said that their marketers have established performance-tracking and performance-boosting teams, systems and processes to push their companies’ strategies, products, customer value propositions, ad campaigns and activities to deliver quantifiably improved results.

These CEOs said that their marketers are perceived as key players when it comes to revenue/profit generation; have solid influence within their organizations; are trusted by top management; and have been identified to be groomed for advancement. 

“Whether we like it or not, what CEOs are telling us is clear-cut: They don’t trust traditional marketers, and don’t expect much from them,” sums up Jerome Fontaine, Fournaise’s global CEO and chief tracker. Many CEOs obviously have to deliver shareholder value, and all want “no-nonsense ROI marketers” who deliver measurable business results, he adds. 

 “In this context, the questions to marketers are simple,” Fontaine maintains. “What type of marketer do you want to be? How much of a business driver do you want to be known as? How much respect and trust do you want to earn from your CEO? How far up do you want to go within your organization?”

Fontaine goes further: “At the end of the day, marketers have to stop whining about being misunderstood by CEOs, and start remembering that their job is to generate customer demand and deliver performance. This is business. When was the last time you heard CFOs whine about being misunderstood by CEOs?”

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