The "Now-Next-New" Approach to Marketing Resource Allocation

By now, most B2B marketing leaders are well into their planning for 2022, and some of the most important and difficult decisions they will be required to make during the planning process involve the allocation of marketing resources (money, people, time, etc.).

Resource allocation is a challenging part of marketing planning for several reasons. First, regardless of company size, the resources available for marketing are rarely sufficient to enable marketing leaders to do everything they'd like to do. Therefore, choices must be made, and the task for marketing leaders is to deploy their finite resources in ways that will do the most good.

Deciding how to invest limited resources has also become more complex because today's marketing leaders have more options than ever before. The number of marketing channels, techniques and marketing technology solutions has grown dramatically over the past several years.

Resource allocation decisions are further complicated by the need to produce short-term results, while simultaneously laying the foundation for success in the future. Because customer expectations and communication preferences are always evolving, marketing tactics that are highly effective today may be less effective in the future, while tactics and capabilities that aren't important today may become key to future success.

Lastly, resource allocation is challenging because marketing leaders are constantly hearing about new marketing channels, tactics and technologies, all of which are touted as the "next great thing" in marketing.

It's no wonder, therefore, that many marketing leaders say resource allocation is the hardest part of their job.

The 70-20-10 Rule

Fortunately, there's a rule of thumb that marketing leaders can use to address resource allocation challenges. It's called the 70-20-10 rule or sometimes the now-next-new rule, and it's been used for a variety of business purposes. Many companies have used it to manage innovation resources, and Coca Cola reportedly used a version of the rule for years to inform marketing investment decisions.

Here's how the rule works.

The 70 ("Now") - The marketing version of the 70-20-10 rule states that 70% of a company's marketing resources should be devoted to capabilities and programs with a well-established track record of acceptable performance. These will typically include marketing channels, tactics and technologies the company is already using.

The rule doesn't mean that companies should automatically "keep doing what they're already doing." It means marketing leaders should evaluate how well their "bread and butter" tactics are performing and continue investing in those that are delivering acceptable results.

The primary goal of these capabilities and programs is to drive incremental performance improvements in the short term, i.e. the now.

The 20 ("Next") - According to the 70-20-10 rule, 20% of a company's marketing resources should be devoted to emerging marketing channels, tactics and technologies. This category typically includes practices and capabilities that a growing number of  other companies are using successfully and that are or may be nearing mainstream adoption.

Investments in this category frequently relate to capabilities that will become critical to a company's success in the near-term future, or next.

The 10 ("New") - The remaining 10% of marketing resources should be devoted to new channels, tactics and technologies that have just appeared on the scene. These investments enable true marketing innovation to occur, but they are also largely untested activities or capabilities. They may or may not produce significant short-term results, but they have the potential to become productive in the intermediate- or long-term future.

Caveats

As with other rules of thumb, marketing leaders should view the 70-20-10 rule as a guide rather than a precise prescription. The specific percentages in the rule may not be appropriate for every business.

It's also important to recognize that like all business rules of thumb, the 70-20-10 rule is not useful for all resource allocation decisions. For example:

• The rule does not address how resources should be allocated within each major resource category - the 70%, the 20% and the 10%.
• The rule is not designed to guide the allocation of resources between brand building and demand generation activities and programs.
• The rule may not be appropriate if a company's current marketing efforts are significantly underperforming. In those cases, marketing leaders may need to make more drastic changes than the rule would suggest.

Three Keys To More Successful Thought Leadership Marketing In 2022

(If you've decided to add thought leadership marketing in 2022, or if you need to improve your thought leadership program next year, the time to start planning is now. This post describes three steps B2B marketers can take to elevate their thought leadership efforts in 2022.)

It's now abundantly clear that compelling thought leadership content is a vital component of effective marketing for many B2B companies. Numerous studies conducted over the past several years have shown that business buyers are relying more and more on thought leadership content and that it has a substantial impact on purchase decisions. 

The latest significant research on this topic is the 2021 B2B Thought Leadership Impact Study by Edelman and LinkedIn, which was released last month. This study involved a survey of 3,593 global business executives across a wide range of industries and company sizes. The survey was conducted in June and July of this year and included respondents from the United States, Canada, the United Kingdom, Singapore, Australia and India.

The new Edelman/LinkedIn study confirms the importance and value of compelling thought leadership content. For example:

• Fifty-four percent of Decision Makers* and 48% of C-level survey respondents said they spend more than one hour per week reading and reviewing thought leadership content.
• Sixty-three percent of the survey respondents said thought leadership is important in providing proof that a company understands or can solve their business challenges.
• Sixty-five percent of the respondents said they had significantly changed their perception of a company for the better because of a piece of thought leadership content.

It's also clear, however, that many companies need to improve the quality of their thought leadership content. In the Edelman/LinkedIn survey, only 15% of Decision Makers* rated the quality of the thought leadership content they consume as very good or excellent, while 30% rated the quality as mediocre, poor or very poor.

Producing thought leadership content that will earn and keep the attention of potential buyers is not easy. Marketing with thought leadership content has many of the same requirements as other forms of marketing. Marketers need to understand who their target market is and what their company's value propositions are. And just like all other forms of marketing, thought leadership marketing efforts should the aligned with the company's overall strategic objectives and plans.

But thought leadership marketing also has some important characteristics that set it apart from other types of marketing. Here are three steps that B2B marketers should take as they develop their thought leadership plans for 2022.

Set High Standards for Thought Leadership Content

The explosive proliferation of content over the past several years has made it more difficult for marketers to create content that will cut through the noise and earn the attention of potential buyers. Thought leadership content can do just that, but only if it constitutes "real" thought leadership.

Several studies have identified the characteristics that make thought leadership content persuasive. While the exact descriptions used in these studies vary somewhat, the research findings consistently show that three attributes define real thought leadership and distinguish it from other types of marketing content.

Relevant - Real thought leadership content addresses topics and provides insights that are highly relevant for the target audience. Of course, all marketing content should be relevant for its audience. What sets real thought leadership apart is that it addresses topics that can have a major impact on the business or professional success of the target audience.

Novel - Real thought leadership content provides information and insights that are genuinely novel. Merriam-Webster defines novel as "new and not resembling something formerly known or used." So to qualify as real thought leadership, a content resource must provide information or insight that adds something new to the body of knowledge about a topic. In other words, real thought leadership provides the audience information they cannot find elsewhere.

Authoritative - It's important for all types of marketing content to be credible, but thought leadership content must meet a higher standard. Because thought leadership content introduces new and novel ideas, it's essential for content developers to support those ideas with sound and persuasive evidence.

Most B2B marketers have demanding jobs, and the never-ending pressure to "feed the content beast" can make it tempting to take shortcuts when developing thought leadership content. But it's vital that marketers not make compromises regarding these three standards.

Set Realistic Expectations

Producing relevant, novel and authoritative thought leadership content almost always requires a significant amount of original research. Original research actually plays two essential roles in the effectiveness of thought leadership content. First, it is required to uncover the new information and develop the new insights that make thought leadership content novel. And second, original research provides the evidence that makes thought leadership content authoritative.

Original research takes time, and that's especially true when it consists of primary research such as surveys, focus groups or interviews. Therefore, marketers need to set realistic goals for the amount of thought leadership content they can produce during any given period of time.

Map the "Knowledge Landscape"

Once marketers have identified a list of potential topics for thought leadership content, it's important to conduct sufficient research to determine where the "white space," if any, exists regarding those topics. 

Marketers can't determine what topics are appropriate for thought leadership content until they know what subjects have already been addressed. To develop thought leadership content that is truly novel, marketers will usually want to avoid topics that have already been covered. 

There are, however, three notable exceptions to this general rule.

• First, a broad topic may have been already discussed, but specific aspects of the topic may not have been thoroughly covered. These particular aspects can be good subjects for thought leadership content if they are relevant and important to potential customers.
• Second, if a topic has not been addressed for a considerable period of time, it can be appropriate to take a fresh look at that topic.
• And third, if a topic has already been addressed but the existing treatments are flawed or incomplete, that can be an appropriate subject for thought leadership content.

*The Edelman/LinkedIn study defined Decision Makers as company executives ". . . who consume thought leadership and are involved in recommending and/or making final decisions on their company's choice of professional service providers or products."

Image courtesy of Erdonzello via Flickr (Public Domain).

The Persistent Measurement Challenge: B2B Findings From "The CMO Survey"

This post will conclude my discussion of several B2B-specific findings from the August 2021 edition of The CMO Survey. In my earlier posts, I reviewed what the survey revealed about the state of marketing spending and the progress B2B companies have made on the digital transformation of marketing. You can find the two previous posts here and here.

The CMO Survey is a semi-annual survey of senior marketing leaders with for-profit U.S. companies. The survey is directed by Dr. Christine Moorman and sponsored by Duke University's Fuqua School of Business, the American Marketing Association and Deloitte LLP. A more detailed description of the survey is included in the first post in this series.

In this post, I'll focus on what The CMO Survey revealed about how B2B marketers are addressing the perennial challenge of measuring the impact and value of marketing.

Proving the Value of B2B Marketing

It's not news that marketers have been under pressure for the past several years to prove the business value of their activities and programs. The CMO Survey found that these pressures are increasing. Fifty-three percent of the survey respondents with B2B product companies said they are feeling increasing pressure from their CEO to prove the value of marketing. For survey respondents with B2B services companies, the comparable percentage was 68%.

The CMO Survey also addressed what metrics companies are using to measure marketing performance. It asked survey participants to distribute 100 points to reflect the degree to which their company is using seven marketing performance metrics. The following table shows how the respondents with B2B companies distributed the points.

The ultimate objective of most marketing leaders is to be able to measure the impact of marketing activities quantitatively, but this can be challenging, particularly when it comes to measuring the long-term impact of marketing. The CMO Survey asked survey participants which of the following three statements best describes how they demonstrate the short-term and long-term impact of marketing.

• "We prove the impact quantitatively."
• "We have a good qualitative sense of the impact, but not a quantitative impact."
• "We haven't been able to show impact yet."

The following two charts depict how the respondents with B2B product companies and those with B2B services companies answered these questions.

These findings clearly show that measuring the business impact of marketing remains a significant challenge for B2B marketers. Fewer than half of the surveyed B2B marketers said they can measure the short-term impact of marketing quantitatively.

Even fewer B2B marketers can measure the long-term impact of marketing quantitatively - only 27.5% of marketers with B2B product companies, and only 36.4% of marketers with B2B services companies. More concerning, nearly a fifth of marketers with B2B product companies (18.8%), and 13.6% of marketers with B2B services companies cannot show the long-term impact of marketing at all.

Measuring the long-term impact of marketing is a difficult challenge for all marketers, not just B2B marketers. Only about a third of the B2C marketers who responded to The CMO Survey said they can show the long-term impact of their activities quantitatively.

Two years ago, Google published an excellent paper discussing "three grand challenges" relating to the measurement of marketing effectiveness. The authors of the paper acknowledged that perfect solutions for those challenges don't currently exist. In fact, the primary objective of the paper was to focus on the areas where existing methods of measuring marketing effectiveness are "running up against the boundaries of the possible."

I discussed the Google paper in three posts, which you can find here, here and here, and I encourage you to take the time to read the entire paper.

Top image courtesy of theilr via Flickr (CC).

Digital Transformation Comes of Age: B2B Findings from "The CMO Survey"

This is the second of three posts discussing some of the B2B-specific findings of the August 2021 edition of The CMO Survey. I included a detailed description of the survey in my first post, so I won't repeat that description here.

The "Part 1" post discussed the economic outlook of B2B marketers and the state of marketing spending in B2B companies. In this post, I'll discuss what The CMO Survey reveals about the state of digital marketing in B2B companies.

The Digital Transformation of B2B Marketing

The general view is that B2B companies have been somewhat slower to adopt digital marketing than B2C companies. While this view may have been accurate in the past, The CMO Survey provides compelling evidence that many B2B marketers* have now fully embraced digital marketing techniques.

For example, survey respondents with B2B product companies said they are currently spending 50.6% of their total marketing budget on digital marketing activities. And respondents with B2B services companies reported devoting 61.9% of their budget to digital marketing. These percentages are comparable with those reported by survey respondents with B2C companies.

The COVID-19 pandemic accelerated the shift to digital marketing, and this shift is reflected in the growth in spending on digital vs. non-digital marketing. The following chart show how overall marketing spending and spending on digital marketing changed in the twelve months preceding the survey in B2B product companies and B2B services companies.

 

B2B marketers expect their investment in digital marketing to continue growing. The CMO Survey asked participants to estimate how their spending on digital marketing will change in the twelve months following the survey, compared to the twelve months preceding the survey. Respondents with B2B product companies said they expect their spending on digital marketing to increase 12.6%, while respondents with B2B services companies expect an increase of 16.0%.

Digital Marketing Maturity in B2B

The CMO Survey also revealed that B2B companies had made substantial progress on their digital marketing transformation efforts in the twelve months preceding the survey. The survey asked participants to rate their level of digital marketing transformation maturity using one of the following four categories:

• Nascent - "Early steps to design and visualize transformation"
• Emerging - "Build non-integrated digital elements"
• Integrated - "Fully integrate digital investments across company"
• Institutionalized/Established - "Leverage digital investments to drive and evaluate marketing decisions"

The survey asked participants to rate their current level of maturity and also to identify where they stood one year prior to the survey. The following chart shows how marketers with B2B product companies responded to these questions.

As this chart shows, the percentage of B2B product companies at the "lowest" maturity level - nascent - declined significantly over the twelve months preceding the survey, while the percentages of companies at the three higher maturity levels all increased.

The pattern is the same for B2B services companies, as the following chart shows.

Collectively, these findings show that B2B marketers are strongly committed to digital marketing strategies and tactics and are making significant progress on the path to digital marketing transformation.

In my next post, I'll discuss what The CMO Survey reveals about how B2B marketers are dealing with the perennial challenge of measuring marketing performance.

*The CMO Survey does not state that it uses a representative sample of B2B marketing leaders. Therefore, the survey findings cannot be projected to the entire population.

Top image courtesy of Dominic Smith (Cerillion) via Flickr (CC).

B2B Findings From "The CMO Survey" - Part 1

The findings of the August 2021 edition of The CMO Survey were published last month. The CMO Survey is led by Dr. Christine Moorman and sponsored by Duke University's Fuqua School of Business, the American Marketing Association and Deloitte LLP.

This is the first of three posts that will discuss some of the B2B-specific findings from The CMO Survey. The August survey results are based on responses from 282 senior marketing leaders at for-profit companies based in the United States. Over two-thirds of the respondents (69.8%) were affiliated with B2B companies, and 94.1% were VP level or above. The survey was in the field August 4-25, 2021.

The CMO Survey is conducted semi-annually, and it provides a wealth of information. Dr. Moorman and her colleagues typically produce three reports for each edition of the survey.

• "U.S. Highlights and Insights Report" - This is a relatively brief and graphically-rich report that provides mostly top-level results, along with an analysis of those results and major marketing trends.
• "Topline Report" - This report provides response data at the aggregate level for all survey questions.
• "U.S. Firm and Industry Breakout Report" - This is the most detailed report. It provides response data by four primary economic sectors (B2B product companies, B2B services companies, B2C product companies and B2C services companies), fifteen industry sectors, company size and volume of internet sales. This report is typically quite lengthy, but it provides the most granular view of the survey data. 

The CMO Survey does not state that it uses a representative sample of senior marketing leaders at U.S. for-profit companies. Therefore, the survey findings cannot be projected to the entire population.

In this series of posts, I'll be discussing the responses of B2B marketers exclusively unless otherwise indicated. The percentages and other numerical values in these posts are the mean of survey responses, also unless otherwise indicated.

Marketer Optimism Reaches Pre-Pandemic Levels

On average, the optimism of B2B marketers has returned to pre-pandemic levels. The survey asked participants to rate their level of optimism regarding the overall US economy on a 100-point scale, with "0" being least optimistic, and "100" being most optimistic. The following chart shows how B2B marketers rated their optimism in the five surveys conducted since August 2019.

It also appears, however, that marketers' optimism may be moderating. The August survey asked participants if they were more or less optimistic about the overall US economy compared to the previous quarter. The following table shows how B2B marketers responded.

Marketers' optimism appears to be reflecting the trajectory of overall economic growth in the US. According to the Bureau of Economic Analysis, US real GDP grew at an annualized rate of 6.3% in the first quarter of 2021 and at an annualized rate of 6.7% in the second quarter.

The Conference Board is currently forecasting that real GDP will grow at an annualized rate of 5.5% in the third quarter and by 3.9% in the fourth quarter. For the entire year of 2021, The Conference Board expects real GDP growth to grow by 5.9%, slowing to 3.8% in 2022.

The State of Marketing Spending

The CMO Survey includes several questions pertaining to the state of marketing budgets and spending that usually receive a good bit of attention. The survey asked participants to estimate what percentage of their company's total revenue is represented by marketing expenses. The following chart shows how marketers from B2B product companies and B2B services companies responded to this question in the surveys conducted since August 2019.

In a recent post, I discussed some of the findings of Gartner's CMO Spend Survey, 2021. The "headline" finding of that research pointed to a significant decline in marketing budgets as a percentage of company revenue. Gartner found that the mean percentage of total company revenue allocated to marketing in 2021 is 6.4%, down from 11% in 2020. The mean percentage for B2B companies represented in the Gartner survey was 6.2%.

The above chart also shows a decline in marketing spending as a percentage of company revenue in the August 2021 edition of The CMO Survey, compared to the previous four surveys. The decline occurred in both B2B product companies and B2B services companies.

In its survey report, Gartner treated the decline in the proportion of marketing budgets to company revenue as evidence that marketing budgets have been cut - or at least that they haven't recovered from cuts that occurred last year. I don't believe the survey data supports that conclusion.

As a ratio metric, the percentage value is obviously affected by both components of the ratio. A company's marketing budget may have been increased in absolute terms, but the proportion would still fall if company revenues grew enough in the same time frame.

The CMO Survey provides a more direct measure of changes in marketing spending. The survey asked participants to estimate by what percent their overall marketing spending changed in the twelve months preceding the survey. The following table shows how B2B marketers answered this question in the five surveys conducted since August 2019.

This table clearly shows that marketing spending in the survey respondents' companies slowed or declined in the June 2020 and February 2021 editions of the survey. However, marketers in both B2B product companies and B2B services companies reported increases in spending in the latest survey.

My view is that this is one of those issues where averages aren't particularly meaningful. In fact, The CMO Survey found that changes in marketing spending varied substantially across industries. For example, in the August 2021 edition of the survey, respondents with banking, finance and insurance companies reported a mean increase of 20.2% over the preceding twelve months, while respondents with manufacturing companies reported a mean increase of only 3.6%

In my next post, I'll discuss more of the B2B findings from the August edition of The CMO Survey.

Top image source:  The CMO Survey

Why Marketers Shouldn't Ignore "Out-of-Market" Prospects

If you've ever visited California wine country, you may have fantasized about owning a vineyard. Acres of trellised grapevines laid out in neat rows create an idyllic landscape, like the one shown in the above photograph.

Of course, the reality is that operating a vineyard is hard work. And some of that work must be done long before the vineyard owner receives a payoff.

For example, it typically takes three years for newly-planted grapevines to produce a useable harvest. During those three years, the vineyard owner must install a trellis system to support the vines as they grow, and young vines must be regularly pruned and "trained" to grow correctly. They must also be judiciously watered, occasionally fertilized and constantly protected from harmful insects. And all of this work must be done before the vines produce the first dollar of revenue for the vineyard owner.

Some of you may be wondering what this brief foray into grape horticulture and vineyard management has to do with B2B marketing. Quite a bit actually, particularly for B2B marketing leaders who need to develop marketing strategies and programs that will produce sustained short-term and long-term revenue growth.

To generate maximum revenue growth over an extended period of time, marketing leaders must design programs that will maximize performance in the present, while simultaneously investing in programs that will lay the foundation for success in the future.

The Challenge of Out-of-Market Prospects

So what does this mean in practice? The starting point is a broad definition of the market. As I wrote in a recent post, identifying all potential growth opportunities is far less likely to occur when marketing and other business leaders fail to take an expansive view of their market.

In B2B, a company's "market" should be defined to include all organizations located in the company's service area that could derive substantial benefits and earn an attractive ROI by purchasing and using the company's product or service. When the market is defined in this way - that is, by customer "fit" - it will include almost all of the prospective customers the company can potentially earn revenue from.

At any given point in time, however, most of the organizations comprising a company's market are not considering the purchase of a solution like the one the company offers. Many veteran marketing and sales professionals call this circumstance the "95-5" rule, meaning that at any point in time, 95% of the company's potential customers are "out-of-market," while only 5% are actively "in-market."*

Based on our definition of the market, out-of-market organizations are a good fit for the company's product or service, but these prospects are not ready to begin a buying process. And it's unlikely that typical demand generation programs will persuade them to change their position. 

However, many potential customers that are out-of-market in the present are likely to be in-market at some point in the future. So, out-of-market prospects are like those young grapevines in a vineyard. They aren't productive today, but if handled properly, they can be productive in the future.

The issue for marketing leaders is what marketing programs, if any, should be used with out-of-market prospects. There are currently two major schools of thought regarding this issue.

In This Corner . . .

Some marketing practitioners, agencies and consultants argue that marketers should use intent data and predictive analytics to determine when an organization is likely to be in-market, and then focus marketing efforts on those prospects. Not surprisingly, this approach has been loudly advocated by firms that sell intent data and/or predictive analytics technologies.

Most proponents of this approach don't explicitly say that marketers should ignore out-of-market prospects, but some come pretty close. Consider, for example, this blog post passage from a firm operating in the intent data/predictive analytics space:

"To avoid wasting time and money pursuing prospects that either already just bought the product from your competitor or are not serious about buying yet, your team should focus on the right people, targeting them at the right time by leveraging intent data, which will help you understand total active demand. Instead of a broad market of generic buyer personas, it enables you to find specific accounts that are active in your market."

And In This Corner . . .

Other marketing practitioners, agencies and consultants contend that companies should reach out to all organizations that are a good fit for the company's product or service regardless of whether those prospects are currently in-market. The proponents of this approach typically stress the importance of brand building to long-term revenue growth.

My Take

I'm not aware of any rigorous research study that compares the effectiveness of these two approaches. The analysis performed by Les Binet and Peter Field in 2019 comes close, but Binet and Field expressly acknowledged that their findings should be viewed as tentative.**

Despite the limited amount of direct evidence, I contend that it would be risky for most B2B companies to ignore prospects that don't make the in-market cut. Such an approach is dangerous because it fails to account for an important aspect of how business buyers make purchase decisions.

The conventional view is that a B2B buying process begins when a company's leaders or managers recognize a need or a problem and decide to do something about it. These "buyers" then gather information about the need or problem, evaluate possible solutions and may or may not decide to buy a product or service to address the need or problem. So the traditional view of B2B buying is that information gathering, learning and evaluation all occur after an intentional buying process is underway.

But business decision makers rarely begin a buying process with a clean slate. Every day, they are forming impressions of companies, brands and products from touch points like ads, content resources, news reports and conversations with business colleagues and friends. 

When something triggers an intentional buying process, these accumulated impressions exert significant influence on the purchase decision. For example, a 2020 study by The B2B Institute and GWI found that millennial business buyers, ". . . spend the most time on research, explore the widest range of vendors, and yet are the most likely to ultimately pick one that they already know."

If marketers focus their efforts solely on in-market prospects, they'll be abandoning the opportunity to influence the perceptions and preferences of many future potential buyers and likely missing out on future growth opportunities. Such an approach would be like a vineyard owner failing to properly nurture the young grapevines that will drive the vineyard's future revenues.

* The percentages in the 95-5 rule are not meant to be taken literally. The actual percentages of out-of-market vs. in-market prospects will vary from industry to industry and company to company. What makes the rule valid in a general sense is that companies almost always have far more out-of-market prospects than in-market prospects.

** It would be very hard to design and conduct a study of this issue that is scientifically sound because of the difficulty of controlling for all the variables that could affect the research outcomes and because the study would need to be conducted over an extended period of time.

Image courtesy of Aaron Logan via Flickr (CC). 

What CEO's Really Think of CMO's

A recent survey by the Boathouse Group, a marketing agency/consulting firm based in Boston, should serve as a wake-up call for B2B marketing leaders. The 2021 CMO Study was based on a survey of 150 Fortune 3000 CEO's from 13 industries. Survey respondents represented companies with annual revenue ranging from $250 million to more than $1 billion. The survey was in the field May 26 - June 8, 2021.

The researchers had two objectives for this survey. They wanted to capture the perspectives of CEO's on the role and importance of the CMO position, and they wanted to explore other CEO perceptions that might help explain the short average tenure of chief marketing officers. The survey report noted that average CMO tenure (in 2020) was at the lowest point in the past decade.*

Like other research I've recently discussed, the Boathouse survey found that driving revenue growth has become the top marketing priority in the eyes of many CEO's. A significant plurality of the survey respondents (47%) said the most critical role of the CMO is to "grow the business." Developing the brand came in a distant second at 29%.

The Boathouse survey contains both good news and bad news for CMO's. First, the good news.

The Good News

The CEO's surveyed by Boathouse expressed several positive sentiments regarding CMO's. An overwhelming majority (86%) said CMO's have the power and credibility to influence key decisions made by C-level executives. Sixty-three percent of the survey respondents described CMO's as "performance-minded," and 58% said CMO's understand the business and shareholder goals of the company.

Now For the Bad News

Unfortunately, the Boathouse survey also revealed that many CEO's have several negative perceptions of CMO's - or at least the CMO's they've worked with.

For example, only 34% of the surveyed CEO's said they have great confidence in CMO's. And 80% of the survey respondents said the short-term tenure of CMO's was a sign of CMO failure. When survey participants were asked why CMO's are failing, 38% of the respondents said it was because CMO's have the wrong skill set for the changing marketing environment, and 21% said it was because CMO's have difficulty measuring the business results of marketing programs.

These results are similar to the findings of a 2021 survey of senior management executives conducted by the CMO Council. In that survey, only 17% of the respondents said they were extremely confident in marketing's ability to lead a growth recovery in 2021, and another 52% said they were just moderately confident.

The Boathouse survey also contained some fairly depressing findings about the level of trust CEO's have in CMO's, with only 32% of the surveyed CEO's saying they trust CMO's. Some of the CEO perceptions described in the survey report are visceral. For example:

• 56% of the respondents said CMO's are committed to themselves, but only 44% said they are committed to the CEO/board.
• Only 56% of the respondents said the CMO supports the long-term vision of the CEO, and only 10% said the CMO puts the CEO's needs before their own.

Lastly, when Boathouse asked survey participants to identify the most trusted and the most valuable member of their leadership team, CMO's didn't fare very well. The following table shows how the surveyed CEO's responded to these two questions.

My Take

Some of the findings in the Boathouse survey seem to be very contradictory. For example, the surveyed CEO's said CMO's have the credibility to influence key C-suite decisions, but only about a third of the respondents said they trust CMO's. It's as if the survey respondents were answering some questions based on what they believe CMO's should be or could be, while answering others based on what they think most CMO's actually are.

*The survey report contains a somewhat confusing chart that depicts average and median CMO tenure from 2011 through 2020. The chart appears to be based on data from the 2021 edition of the CMO Tenure Study by Spencer Stuart. You can review the Spencer Stuart data here.

Top Image Source:  Boathouse Group Inc.