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A CMO can get stuck in their own marketing world. As a head of marketing myself, I have occasionally fallen into what I call marketing tunnel vision. The condition has three symptoms: it complicates communications with other executives, especially your CEO; it distracts CMOs from the bigger picture of the business; and it perpetuates the stereotype that marketers are lightweight business people.
It doesn’t have to be this way. I have the cure, and it’s as simple as changing your mindset – to that of an investor. Not only will it cure you of these symptoms, but I believe it will prove a boost to your career.
Why is it so many CMOs have a hard time communicating or relating to their CEO? Let’s think about a chief executive. His job is to grow the return for investors – the board members for a private company or the institutional investors of a public company. No matter what type of company. Investors care about earnings. CMOs need to talk to their CMO in these terms.
When a CMO reports his department’s growth in MQLs, on its own this stat is several equations away from return on investment, and thus harder for an earnings-oriented thinker to process.
CMOs should not expect a CEO to fill in the gaps any more than they should expect a customer to translate their product’s features into benefits. Shame on us. CMOs know better, after all. Our whole job is to put our products or services into the context of our buyers – understanding what motivates them and ultimately to speak their language. We need to do the same for CEOs.
And it’s not just you as the CMO. Your team needs to speak in terms of investment when they are presenting to the CEO or to the Board. As John Ellett, author of The CMO Manifesto, pointed out in a recent conversation:
“Your team is your responsibility as a CMO, and how they communicate to other executives is ultimately a reflection on you as the marketing leader. You need to train your team to communicate in terms other departments will understand. Marketing metrics are not necessarily best.”
Thinking and acting like an investor will not only solve your communications issues, but it will make you into a better businessperson. Moving away from a narrow minded focus on marketing stats to a broader view of how marketing contributes to the bottom line is a much more useful and objective viewpoint. Ready to start? Here’s how:
Stop spending, start investing – Strike the word ‘spend’ from your vocabulary. Start using the word ‘invest.’ Move the perception of your team from a cost center to a profit center. After all, you are investing the company’s dollars to generate leads that turn into deals.
Pay attention to returns – Here’s a simple question: How much do you make from every dollar you invest? Keep tabs on your marketing effectiveness by tracking the return on every program. Don’t present marketing statistics like website growth and email conversion rate to your CEO or executive team. Share with them the return of each program (positive or negative; remember, not all investments make money) and your overall return on marketing spend.
Have a hedging strategy – Do you hedge your bets? By that I mean your programs. I do. I know that I have a certain growth target, and not all of my programs are going to return what I forecast. So I hedge, in multiple ways. I have a backup program that can compensate for those that fall short. I use the lower end of known conversion rates when I calculate my funnel. I estimate full price for program costs, and then I make sure to get a discount from the vendor to bring my costs down. Aim for success, but prepare for failure.
Act like it’s your money – You are the steward of the company’s money, so act like it. Better yet, act like it’s your money. Did you pay full price for your last car, or did you shop around? Ask for a discount? So many marketing teams pay full price because they are embarrassed to ask for a discount, or uncertain how to go about it. All you need to do is ask. And by the way, if you pay less than your competition for trade show space or ad inventory, that’s a competitive advantage.
Think long term and short term – Just like investments, some will pop right away, and some will vacillate but grow over time. Do keep a gimlet eye on your returns, but don’t kill long term growers too early. As the “Oracle of Omaha” Warren Buffet so aptly put it, “Someone’s sitting in the shade today because someone planted a tree a long time ago.” Nurturing programs are a great way to execute on this philosophy, and are essentially free.
Successful fund managers attract more money – Want a bigger marketing budget next year? Then get a great return this year. Just like a successful fund manager attracts more investment. If your CEO knows he will get a higher return on investment by adding to the marketing budget instead of hiring more sales people or engineers, he will give you more money. He almost has to, out of fiduciary responsibility.
like an investor will bridge the communications gap and help your business, and in return, your career.
So, channel your inner Warren Buffett. Invest like it’s your own money. Put your marketing dollars into things that you truly believe in and success will be merely an investment away.