McKinsey: CMOs the next CEOs, marketing’s 5 imperatives to reach the top
In a few years CMOs will succeed CEOs as the rightful leaders of organisations, Milosh Milisavljevic, partner at McKinsey & Company, predicted at last week’s ADMA Global Forum.
“Organisations need to be more customer and market oriented,” Milisavljevic said. “The landscape in which organisations operate is much more dynamic and fast moving, and with partnerships in the broader market becoming the norm, then who better to lead the organisation than the CMO?”
Elaborating on his vision for the CMO’s ascent, Milisavljevic outlined five imperatives for the future of marketing.
1. Think ‘customer’ not ‘customers’
Marketing must integrate across the organisation to instil customer-centric strategy and deliver the personalised customer experiences possible, Milisavljevic told attendees of day two of the Forum.
“The internal role of marketing continues to change, from a stand alone unit to integrated across the whole organisation,” he said. “That cuts across being the leader of an integrated strategy and the voice of the customer as well as being able to coordinate the multiple touch points across the organisation and deliver insights consistently.”
Externally, organisations are shifting from push to engagement style interaction across touch points. “With both interactive and physical touch points you can get a lot more sophisticated around driving a needs-based conversation, optimising for the best experience and financial returns, and personalising digital touch points.”
Organisations investing in these capabilities are outperforming those that aren’t significantly in terms of profit, sales, growth and ROI, McKinsey’s research shows.
2. Fix everything, no trade offs
Instead of prioritising areas to focus on, marketers need to push for organisation-wide digitisation, Milisavljevic said. “The old adage of – the CMO thinks about brand and service, the sales guy thinks about revenue, the ops guys thinks about reducing costs and productivity – is no longer the case.”
“In the new world, where digital approaches have been developed in an integrated way, you can deliver a lot more.”
It all links together – engaged employees are more productive and deliver better customer experience, which in turn drives satisfied customers and revenue growth. “There’s no reason not to fix everything at the same time in a sustainable way,” Milisavljevic said.
3. Compete with your bricks
“The conversation we have with clients about digital attackers, digital business models and driving sales or service online often sees the role of multi-channel overlooked,” Milisavljevic said.
Leveraging bricks-and-mortar as a strategic asset is growing in importance, but think of multi-channel as two way, by making the in-store experience more digital, Milisavljevic advised.
“Amazon is coming [to Australia] with a proposition that addresses all the reasons why people shop in stores,” Milisavljevic warned. “They’re replicating shopping enjoyment and environment in showrooms and mobile apps, providing immediacy through same day delivery, making product returns easier, addressing concerns swiftly and even opening pop up stores.”
The customer decision journey has changed from a sales funnel to a loop that reflects the continuity of customer experiences, Milisavljevic continued. “The key thing to do is develop a customer decision journey heat map and understand which parts of the journey are key opportunities or a key deficit versus your competitors.”
4. Learn the digital dollars game
Transitions in the marketing mix – few channels to multi-channel, sales funnel to customer loop, customer details to big data and perceived benefits to actual benefits – have seen reallocation of budgets.
“Digital marketing spend requires different management,” Milisavljevic said. “The reallocation of push marketing resources to tailored communications and actual service improvement… also to new types of digital as they emerge.”
5. Buddy up with your CEO
Milisavljevic identified five recommendations to demonstrate value to CEOs and make marketing more pervasive throughout the organisation.
Sit at the executive table: Become directly involved in executive decisions,
Become the bonding agent that connects the organisation: the CMO is the logical owner of cross functional operation,
Ensure the CEO becomes an active marketer and connects to the customer: Empower the CEO to be a customer advocate, to know the market and to market effectively as they interact with the public and customers,
Develop and stick to a marketing blueprint: Create a clear definition of how marketing supports the organisation to drive a clearer and more pervasive role of marketing and value across organisations, and
Expand marketing’s influence across the organisation: Being able to drive and have a meaningful role across the organisation.