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Thoughts on the White Paper 'The 2020 CMO in the emerging Digital Economy' “Plus ca change, plus c’est la meme chose” ?

You can download the White Paper that Malcolm refers to in this article here: What is the role of the CMO in the emerging digital economy?

The article below is NOT a synopsis of the full white paper. These are the observations on the report by Professor Malcolm McDonald of The Knowledge Development Committee of the Worshipful Company of Marketors.

Background

The Knowledge Development Committee of The Worshipful Company of Marketers commissioned Professor Stan Maklan and Dr Carmine Basile of the Cranfield University School of Management to undertake a research project on the role of the 20 20 Chief Marketing Officer (CMO) in the digital age. The key differentiator between this piece of work and others lies in the scholarly review of the literature on the role of the CMO, which was used to frame the questions for the in-depth interviews with five CMOs of substantial global companies. These did not include any consumer goods CMOs, which is a limitation, but it can also be seen as an advantage, given that much of the world’s commercial activity is in the B2B domain.

However, we do know that B2C companies are well-abreast of technology developments, and the Worshipful Company of Marketors hopes to repeat this very successful study with B2C in order to reflect the reality within their domain.

Findings 1. Logo manager or customer relationship manager?

Inter alia, the report outlines two extreme scenarios. One such dramatic, dichotomous, tongue-in-cheek comment in the report suggests that one possible option is to leave marketers to manage the logo, leaving the real business of managing customer relationships to data scientists! Against this scenario is that of the traditional CMO being the leader of the customer connection, with data scientists in a supporting role.

The most progressive CMOs see the digital environment as providing unprecedented opportunities for adapting to the ever-changing needs and wants of customers and their expectations of immediacy and convenience and whilst the report stresses the tensions between IT, data scientists and marketers, the reality is that it does not matter what job titles are attached to the traditional role of market and customer sensing and the development of value propositions as long as this crucial role is being fulfilled.

Findings 2. Herein, however lies the principal dichotomy facing the marketing community. The problems and the solution.

Much is made of traditional, rational, logical, step-by-step approaches to developing marketing strategies becoming less relevant due to the rapid changes in market development. The fieldwork confirmed that in social media, the need to be authentic and immediate cannot be accommodated by traditional central control over messages. Modern CMOs see their role as guiding and inspiring thousands in their firms to communicate consistent brand values and messages. The problem with doing this, however, is that new competitors are entering with unfamiliar tactics, boundaries are blurred and CMOs feel a profound sense of unease about decentralisation and the uncertain business model they face. As the report states: The dilemma facing CMOs is “how to maintain an integrated and coherent approach to the market”

Although not in the report, we should like to comment on the above. An article in Catalyst by Jarrett J in July 2019 compares this situation as being like a human without a brain, who would be just a collection of activities that cannot operate. Likewise a global marketing team needs a strategic plan, a north star to gather round, something that will guide compliance and accountability. So there remains a need to put in place consistent processes, systems and tools to enable marketing organisations to maximise effectiveness. Thus, the need for strategic planning will change in nature, but will always be a required skill of CMOs-In other words, we need to get back to the fundamental foundations of marketing strategy development.

Findings 3. Market segmentation remains a fundamental foundation of marketing strategy

The main report refers to this only in the literature review, therefore is not a report finding as such, but the literature review does nonetheless raise the issue of traditional forms of segmentation such as socioeconomics and demographics. Our view is that it has to be recognised that these were never effective ways to segment markets. Needs-based segmentation has always been the bedrock of effective marketing strategies and this report refers in the literature review to the growing opportunity to segment on the basis of customer/user behaviour given the data rich environment we are entering.

Findings 4. Cross-functional working is becoming a key skill and an important part of the CMO’s role

Although not a core finding, this report confirms this crucial element of a CMO’s role. They have always had a at least two principal markets to address – the customer market and their internal market, as it has never been possible to deliver value to customers without the active involvement of most other corporate functions. Given the points spelled out above about the problem of fragmentation and decentralisation, this skill seems destined to become even more important in the digital age.

In conclusion

Marketing’s role is changing and the traditional customer-relating role is now shared, creating new offers with technologists and customers. Hence, marketing planning is more emergent, with CMOs orchestrating the customer relationship more than managing it. New disruptive competitors enabled by technology have made it harder to get a fix on them and to react to them.

Thus, there have been many changes in the world of marketing, yet nothing has really changed , in the sense that we still need properly educated marketers who understand the traditional roles of marketing. The fundamental principle of marketing is market orientation and the key role of the CMO is still customer- relating. That is the strategic leadership job that still needs to be done. CMOs just need to be more tech savvy in order to understand what data and technology can do for creating value for customers, and equally, CTOs / CIOs need to be more aware of the core role and needs of marketing in order to deliver that. Marketing workshops for Data Scientists perhaps?

Data will always remain as just data without a skilful marketing brain to turn it into relevant customer strategy, hence the title of this article with the question mark after it.

About the Author

Emeritus Professor Malcolm H.B. McDonald MA(Oxon) MSc PhD DLitt DSc

Until 2003, Malcolm was Professor of Marketing and Deputy Director of Cranfield University School of Management, with special responsibility for E-Business. He is a graduate in English Language and Literature from Oxford University, in Business Studies from Bradford University Management Centre, and has a PhD from Cranfield University. He also has a Doctorate from Bradford University and from the Plekhanov University of Economics in Moscow. He has extensive industrial experience, including a number of years as Marketing and Sales Director of Canada Dry. Until the end of 2012, he spent seven years as Chairman of Brand Finance plc.

He spends much of his time working with the operating boards of the world’s biggest multinational companies, such as IBM, Xerox, BP and the like, in most countries in the world, including Japan, USA, Europe, South America, ASEAN and Australasia.

He has written forty six books, including the best seller "Marketing Plans; how to prepare them; how to use them", which has sold over half a million copies worldwide. Hundreds of his papers have been published.

Apart from market segmentation, his current interests centre around the measurement of the financial impact of marketing expenditure and global best practice key account management. He is an Emeritus Professor at Cranfield and a Visiting Professor at Henley, Warwick, Aston and Bradford Business Schools.