What Do CEO’s Really Want From Marketing ?

CMO turnover continues to be too high. In the lastest Spencer-Stuart survey, the average CMO tenure rose slightly to 28 months–a positive trend, but still a very short lifecycle by any measure. Given that most CMO’s report to CEO’s, it’s a fair question to ask: “What do CEO’s really want from Marketing?” Lou Gerstner, ex CEO of IBM and American Express has an answer. I attended the M50 CMO Summit last week, and Gerstner talked about what he expects from the Marketing organization.

Lou Gerstner's Marketing Mandate: Customer Experience and Brand Building

Lou Gerstner's Marketing Mandate: Customer Experience and Brand Building

Ensure Excellent Customer Service

His first CMO mandate is customer service. Marketing’s job is to ensure the organization is delivering great customer service,  particularly during tough times. Taking care of the customer, always the right thing to do, is even more important during challenging economic times, because competitors often cut back. And customers notice. Customers have long memories and remember how they were treated–in good times and bad.

A good question to ask yourself is the following: are my CEO and I aligned on the customer experience and what is expected of Marketing ?  Defining and measuring customer satisfaction is only the first step. How and what kind of role Marketing plays in influencing other important functions in the company — Customer Service, R&D, etc., in delivering an excellent customer experience is equally important. Marketing plays a lead role in defining and quantifying the most important factors driving customer satisfaction and how these can be improved, as well as the relationship between customer satisfaction metrics and improved top and bottom line business results.

Build The Brand

His second expectation is that the CMO is building the brand. Gerstner acknowledged that during downturns, you may not be able to spend as much money driving the brand as you’d like. But the CMO’s job is to be the brand steward and to ensure that the company is always investing something in brand building activities and that every part of the organization is living the brand values day in and day out.

Brand building means defining your brands key equities, and continuously working to better communicate and deliver those equities to your customer. This requires that everyone in the organization is crystal clear on what the brand should stand for, and that there is consistent focus and application over time across all functions–and not brand “drift” which tends to occur in many organizations.

Time and again, Gerstner came back to the point that everything starts with the customer.  To reinforce this point, he focused his IBM team on just two metrics: customer satisfaction and market share–two outcomes which are directly linked to delivering great customer service and building the brand.

That’s it. Two simple expectations. Deliver great customer service. Build the brand. If Marketing did these two things extraordinarily well, chances are that the 28 month CMO tenure would increase and begin to approach that of CEO’s at 54 months. Because they would be focusing on what every CEO and CMO should care most about: the customer.

5 Responses to What Do CEO’s Really Want From Marketing ?

  1. Andrew Weir says:

    Thank you for sharing this.
    I fully agree. Building the brand and delivering great customer service are critical success drivers. The key for me is taking customer service further than satisfy customers. To me it’s about about finding ways to delight them.
    It’s a powerful way to cement loyalty and may be even drive advocacy.

    • beardrs says:

      Andrew–Your point is a valuable one. While Gerstner didn’t address the opportunity to delight customers outright, I’m sure he would agree with your point. I like your promise-deliver-delight model. In an earlier post, I talked about the importance of surprise in driving word of mouth. Ultimately, surprise is about exceeding customer expectations–either positively or negatively. Positive surprise is usually something close to delight–something we should all be aspiring to doing more of. Randall

  2. Kris says:

    What this article made me reflect on is how broad a term marketing is and how differently it can be interpreted. Whether or not customer satisfaction and brand are the (only) key functions of marketing is obviously debateable. The important thing is that there is a clear understanding and agreement throughout the organization on what marketing means for the firm. With a clearly defined role, clear expectations can be set -> and met.

    • beardrs says:

      Kris — Agree with your point. What Marketing is responsible for is defined quite differently across industries and companies. Gerstner obviously takes a fairly expansive view of Marketing. I think a key point for many CMO’s is that they need to influence things outside of Marketing as well as within Marketing to fully impact both brand and customer satisfaction. Not everything is in their direct control, and even in Marketing centric organizations, there are many factors impacting brand and customer sat beyond the Marketing organization.

  3. […] marketing driven ones, it’s a question that needs answering. In an earlier post “What Do CEO’s Really Want From Marketing?,”  I summarized ex-IBM and American Express CEO Lou Gerstners’ point of view: the role of […]

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