Andreas Krasser, who moved from ad agency creative strategist to CEO himself, explores how ad agencies can play a crucial role in helping marketers communicate the value of marketing to CEOs and the board.
A recent study by McKinsey pointed out that CEOs who place marketing at the core of their business strategy are twice as likely to register growth than those who don’t. The issue, however, as pointed out by McKinsey, is that marketing doesn’t have a seat at the table: more than 40% of Fortune 500 companies do not feature a single customer-related role amongst the executive committee.
I’ve witnessed this growing gap between CEOs and their marketing leaders first-hand across markets in Asia and believe that much of it has to do with the fact that marketing has mostly forgotten how to speak the language of growth. Obsessed by redefining the 4Ps and keeping up with the seemingly ever-evolving requirements of modern marketing, many CMOs have shifted to chasing short-term vanity metrics that might matter in an enclosed marketing ecosystem and at advertising award shows but carry little relevance in boardroom conversations.
Constantly speaking in jargon, pointing out how O2O marketing and an omnichannel presence, paired with an influencer & UGC strategy resulted in an increase in engagements, impressions, likes, and followers rather than sales, probably hasn’t been very helpful either in convincing CEOs that marketing is, in fact, an engine for growth.
I believe this is where agencies can and should step in to lend a hand. Not by helping CMOs to teach their CEOs some marketing jargon, but by clearly showcasing the value of marketing across two dimensions that deeply matter to CEOs and boards.
1. Help the CMO to bring customers into the boardroom
Chances are that most company CEOs as well as CMOs are multiple steps removed from their customers and how they encounter their brands on a daily basis. However, every C-suite exec will probably agree that truly understanding their current as well as potential customers’ needs, wants, and grievances is crucial to achieving growth for their businesses.
So, an agency partner can add incredible value not only by having their finger on the pulse and being as close to real consumers as possible, but also by enabling CMOs to give their CEOs a bit of a reality check, increase their customer empathy and let them see their company and brand through the eyes of the people that buy or don’t buy their products.
For this, there are more radical approaches out there such as hosting workshops that force executives to endure a multi-hour wait in a simulated store with uncomfortable chairs. But there are also faster ways to achieve similar insight: these have nothing to do with massive eye charts of quantitative survey data, social media sentiment reports, or controlled conversations in focus group settings though. No. It has everything to do with immersing yourself as deeply into the world of your audience as possible.
This can start with the simplest of techniques: observation. For example, my team and I once wanted to better understand meat purchasing behaviors for home consumption in Korea, so we spent days at various supermarkets across the country, lingering around the meat section, just taking down notes: who goes for the pre-packed stuff, who talks to the staff behind the counter, who shops alone, etc. We then would build hypotheses based on our observations and go on to spend a full day with a representative of our target market; we went to their house, accompanied them on their grocery runs, watched them prepare meals, and asked questions along the way.
This gave us a tremendous depth of insight, which for example search data or even focus groups would not have revealed. Because let’s face it, in agency land we also tend to be pretty far removed from the people we are supposed to be creating for.
In the end, this whole exercise really allowed us to draw a vivid picture for our client’s C-suite of who their audience was and what they cared about, ultimately leading to a shift in their overall positioning.
2. Help the CMO to become a connector within their own organization.
When people encounter a brand, they do so not only via channels that are managed by marketing but by different parts and departments of the organization, all adding up to one customer experience.
According to Forrester research, brands that do best with CX bring in 5.7 times more revenue than their counterparts who lag in this area. So, it would certainly seem beneficial for executives to work seamlessly with their colleagues in other areas. But we all know this is often easier said than done. Corporate legacy structures can enforce silos rather than breaking them down, keeping senior leaders and their teams focused solely on their portion of the bigger picture, often without ever directly interfacing with any other functions.
While agencies can have similar issues with silos, they tend to be more used to cross-functional collaboration, making them a great facilitator for their clients to have inter-departmental conversations they otherwise might not have.
Workshops under the guise of wanting to discuss the future direction of the brand with the senior leadership team have often worked wonders for me to open up broader discussions concerning my clients’ workflows, and even the role and responsibilities of their marketing leaders within the organization.
Providing an open forum, inspired by best practice sharing, I have experienced, can lead to certain ‘aha’ moments that make non-marketing execs see the value CMOs can add along the entire process from product development all the way to after-sales. And if the CMO is able to become the person that integrates all functions and elements along the way, then their value will be apparent to any CEO.
The CEO-CMO relationship remains to be a tricky one. Organizations that have got it figured out are evidently doing extremely well in achieving their growth agendas. Hence, bringing these two positions closer to each other should not only be top priority for brands but also for agencies. After all, once CMOs are viewed by CEOs and boards as growth drivers, so are we. So, if you’re on the agency side, remind the CMOs you’re working with and yourselves, that we’re not in the business of likes, but in the business of growth.
