The challenge is to increase, to move up. But what, and by what measure?
Most senior level people within marketing tell me that their objective is revenue. Some say it’s about brand and brand awareness, and the rest will take care of itself. With my “time away” as an equity portfolio manager, I scoff at them and say, “No, it’s about enterprise value, or share price.” Many will reply that it is the “job of the CEO, with the CMO’s huge assist.” Again, I say no, the reason to work for a company is clear – to enhance shareholder value. This holds for private firms too; the value of the business is the bottom line.
You see, in my scenario, increased revenue, brand esteem and awareness are byproducts of increasing enterprise value. Now, comes the big question – how does marketing contribute?
Most organizations are not equipped to answer these questions on their own. There are entire consulting industries who make this their mission. From Donald Draper to spiffy media tech firms, there are so many people saying that they can help. From my time running marketing for public companies, to my time running agencies, to investing in firms as an angel investor, to running billions as an equity portfolio manager, I think all problems can be brought into smaller components, and then orchestrated back together for one common goal. Each specialist hired as staff, consultant or agency must have the vision, ability and experience to accomplish the tasks set out for them and play well with others.
Issue: the same old, same old.
Too many CMOs are trying to appease their team, set “realistic” goals, and not make mistakes. I believe that top marketers possess the vision and the guts, to hire the firms that fulfill the mission, not the “I trust this team they have worked for me before” or the “I am going to go with a subordinate’s team to appease them” mentality. Trust is a given for any task. Loyalty and all the other hiring checklists are good things, but they rarely provide innovation and move the needle.
This time is no different – innovators win.
I challenge CMOs to accept that their world is being disrupted. Data, technology, micro-targeting, messaging and media have and continue to evolve to extents that were not anticipated in training nor prior experience.
Being the best means taking incremental risks. Constantly hiring big, “safe” firms is the antithesis of finding the niche players that can move the facet of the firm’s needle that you intend to push. Do this enough times and enterprise value is increased, and everyone from the CEO to stockholders win.