Five skills a CMO needs to demonstrate to become CEO
Know your business and the economics that drive your business as well as anyone in the finance department. This is not about accounting per se, but about demonstrating that you know how to make money. They will never give you the key to the CEO office if you cannot demonstrate this capability.
Much has been written about the limited tenure of CMOs, averaging 40 months with the median at 26 months. According to Boathouse, only 4% of CEO’s view their CMO as the most trusted member of their team. Moreover, only 8% view them as the most valuable member of their team with CFOs at 34% and COOs at 35%. Yet in the same breath, 47% of CEOs say that the CMO is critical to grow the business.
These embarrassing numbers tell us CMOs need to do more to become trusted and valuable to their CEO, as well as to be in consideration to become a CEO. There also needs to be a discussion about what CEOs need to do to get the best out of their CMOs.
Having been both a CMO with responsibility for some of the world’s most iconic and recognized brands including Dove, KFC and Taco Bell, and the great privilege to be the CEO of Yum Brands, I want to share my observations and personal experiences about the causes of this misalignment, and provide five points for CMOs looking to demonstrate their ability to reposition to a CEO role.
Rectifying the CEO-CMO relationship
Let’s start with my simple definition of the role of the CMO: ‘SOBO.’ This stands for sales overnight and brand over time. Simply put, CMOs will drive sales overnight. Every CEO wants this. They will also build the brand over time. CEOs should hold this as just as important. Unfortunately, because the value of the brand doesn’t appear on the balance sheet, it is not always equally valued.
Because many people see the CMO as a creative, there is an incorrect assumption they cannot also be numerical. One of the greatest compliments I ever received was from David Gibbs who was on the stage with my CFO and is now the CEO of Yum! Brands, and called me ‘the human calculator’. When a CFO believes that a person who was a CMO is good at numbers, it increases your credibility exponentially. Numerical literacy is a skill that all CMOs should train, regardless of whether it comes naturally.
So, what credibility does a CMO have to demonstrate to the board to be considered CEO material?
1. Develop cultural insights
The best CMOs understand what is happening in society. Cultural awareness improves relevance. Marketing leaders can develop brand and business strategies that make a brand more relevant. Improved relevance means faster growth.
A great personal example of a brand pivoting to remain culturally relevant was Taco Bell in 2011. The role of food in society shifted around this time from fuel to an experience. This necessitated the change in tagline from “Think Outside the Bun”, a comparison to the burger chains as an alternative place to find your fuel.
Taco Bell adopted the tagline to “Live Mas” and moved its messaging to reflect its new role as a lifestyle brand. It remained culturally relevant and has enjoyed a wonderful past decade.
2. Develop employee insights and define customer experience
The customer experience will never exceed employee experience. As such, a CMO that is in tune with broader culture should also have a better handle on the companies’ employees/team members as well.
Customer experience is a key component of the brand experience and while the COO will execute customer experience it needs to be defined by the CMO. It’s important that the COO believes that their team can execute the CMO’s customer experience vision.
If employees do not buy into this vision, nor will the customer. Being in tune with the team builds greater connections with the customer. This is what brand building is all about.
3. Be a great storyteller
Be the author of the story that explains and makes your brand more distinctive and easy to understand. Tell your story in a genuine and enthusiastic way that is galvanizes the hearts and minds of both the consumer and, moreover, your fellow employees and C-Suite team.
As marketers, we talk so much about speaking to your audience in a way that they understand and that is meaningful for them. Well, the same applies to your CEO.
What story do they want to hear? What do they find exciting or compelling?
While some people are naturally born story tellers, the good news is that story telling is a skill that can be learned and eventually mastered.
I have two secrets I have relied upon in my career. Firstly, “less is more”. Make your stories as short as possible. Secondly, never make yourself the hero of the story. Apply these secrets to your external communications, but also to your internal team.
4. Be socially relevant (word-of-mouth)
Make your brand the topic of dinner conversation. There is nothing better than the CEO or board members going to outside events and being told by others what an exciting, cool, or interesting brand has been curated. You make your brand socially relevant by doing things that get talked about in the general population. Taco Bell, for example, ran an April Fools stunt and took out advertisements announcing they had bought the Liberty Bell. We also once created a Pop-Up hotel in Palm Springs that sold out in under two minutes. Pizza Hut once sent the first Pizza into space. Of course, a brand is not solely built on these talking points. But acts like this generate buzz that even your company peers will be privy to.
5. Be Commercial
Know your business and the economics that drive your business as well as anyone in the finance department. This is not about accounting per se, but about demonstrating that you know how to make money. They will never give you the key to the CEO office if you cannot demonstrate this capability. Be inquisitive and ask questions if you don’t know. Again, this comes down to education. My first step was a 10-day finance workshop at Stanford University that I called “Finance for Marketing Dummies”. It helped my confidence but also gave me credibility with the finance team. Since then, I’ve continued to train and educate myself in this area. You cannot succeed in a CEO role without this skillset, so start learning as soon as you can.
Blockers to a functioning CMO/CEO relationships
I also want to share a few thoughts about things that get in the way of fruitful CMO/CEO relationships.
The first is the idea that just because you can measure something, that does not necessarily make it important. Some of the most important things in life cannot be measured or given a score. In business, I would equally argue that the two most important assets that will define any organizations success are their people and brands. Yet, because the accountants have not been able to put a “value” on people or brands, it is unlikely they will be quantified and appear on the balance sheet. As such, many executives, particularly CFOs or CEOs who are former CFOs, do not consider them as important or critical. I attribute a significant proportion of the lack of trust in CMOs to the absence of clear-cut quantitative data.
58% of CEOs believe that CMOs speak their own language versus the ‘language of business’. This lines up with the fact that so few CEOs come from the CMO track. However, we must ask, what are CEOs who come from a non-marketing background doing to understand marketing language? Marketers, general managers, presidents, and CEOs must work together to ensure everyone understands the language of marketing. CEOs must feel more confident when they are talking with their own marketers.
Lastly, my personal experience is that many CEOs and in fact most of the other C-suite executives think of the CMO as a creative, crazy, fun, less disciplined, seat-of-the-pants executive. Whilst they love having them on the team (and who doesn’t love a fun colleague), they get pigeonholed as a player, not a leader.
The need for greater CMO representation
Why should more CMOs be CEOs? Why is it important to improve CMO representation? The answer, as mentioned, is people and brands.
The one person who knows more than anyone else about both is the CMO. Being the brand builder should be their key competency. Moreover, CMOs also know both the cultural and social insights that drive both employee and consumer behavior. Perhaps if a few more companies saw their CMO as a true CEO contender – like Yum did for me – they would see their sales increase and their brands expand.
But, as a final call-to-action for marketing leaders who find themselves at the helm as a CEO: The job is only half-done. Renew your efforts to learn the language of business and empathize with all members of the C-Suite. Your board, brand, and balance sheet will thank you!
Greg Creed is the former CEO of Yum! Brands and Taco Bell. He is currently the Founder of Creed UnCo, an “unconventional” consulting business focused on culture, leadership, branding and franchising and currently sits on several board of directors which include NetBase Quid. He has over 40 years’ experience in the restaurant and consumer packaged goods categories with Yum! and Unilever. Greg was awarded the 2019 Restaurant Leader of the Year and named an Industry Titan by the Women’s Foodservice Forum in 2018.
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