Marketing is dead. Long live Marketing
By Paul Brent
By Paul Brent, Marketing Director, Boyes Turner
Some interesting research came my way recently and, on the face of it, it doesn’t look good for marketing team leaders.
Management consultancy Fournaise explored the relationship between CEOs and the functions that report to them in over a thousand businesses. The results more than suggest that senior management have lost confidence in their marketers and that, for many marketing directors, a place in the coveted ‘C’ suite is a long way off at best.
CEO perceptions of marketers
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80% of CEOs don’t trust their marketers or rate the quality of the work that they do, but 90% hold both finance and IT directors and their work in high regard
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Half of all CEOs have removed marketing from pricing decisions as well as product/service development, as it’s “too important for their organisation’s growth”
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Nearly three in four CEOs have lost trust in their marketing director’s ability to deliver quantifiable growth
Source: Global Marketing Effectiveness Program, The Fournaise Marketing Group
The study has received a great deal of coverage in the marketing press and there has been a lot of discussion over whether marketing has largely become a communications/ promotions/ advertising function, with no way to judge the real value it creates.
That’s not to say that senior management don’t appreciate the role that the function plays in building brands, reputation and so on. However, it would appear that, in many cases, there is little understanding or, more specifically, accurate measurement of exactly how marketing helps to generate revenue (such as acquiring new business or additional income from existing clients).
We all know that the results of any survey should be taken with a pinch of salt. But, there often isn’t smoke without fire and, for many marketers in professional services, Fournaise’s findings aren’t exactly surprising and probably hold true for the sector as a whole, for two main reasons.
The first stems from how the marketing function came about in much of the industry – which was largely to ‘support’ and ‘help’ professionals to win new business. It was very much a ‘back-office role’ with the professionals (i.e. accountants, lawyers and architects) responsible for sales, in the belief that the industry is driven by relationships. The recognition produced by winning clients and revenues that are subsequently generated largely goes to the front-line sales staff – the professionals.
The second is more of a cultural one and is due to the way partnerships – still the mainstay of professional services – have developed to avoid the use of business development/ sales processes that enable efficiency/ effectiveness (in generating clients and income) to be measured.
Where a back-office role and lack of measurement are combined, it is little wonder then that there is a disconnect between what marketing does and its impact on a business’ bottom line. It is also why Fournasie’s findings aren’t particularly surprising.
What’s the answer? Well some of those who have read the research believe that marketing should change its role and focus on managing the ‘client experience’ and become the ‘client or customer champion’ in their organisation. This has been tried before as far back as 2005 in the legal sector, with a number of large firm marketing teams morphing into ‘clients and markets’ teams. In most cases, this was less than successful and short lived. It certainly didn’t improve many of the firms’ profitability or their understanding of the importance/ difference that these teams made, which largely remained unclear and often a mystery.
Some more forward-thinking law firms have come up with what is a very simple and somewhat obvious solution: to actually focus marketing on what the pay masters want it to do, i.e., helping their organisation to make money. This requires the function to lose its ‘support’ badge and take the lead and responsibility for producing revenues.
This has been easier in some areas of the market than others. Where it has been particularly successful is in B2C and the lower value or commoditised end of B2B services. There are numerous examples of marketing teams here that have taken ownership of the sales process. In many cases, this has been made possible through the development and use of marketing-owned websites as sales mechanisms. As a result, the function’s role in client acquisition, conversion and revenue generation has been clear and there has been a directly measurable and visible return on investment. The Fournaise research results don’t apply to many of these marketers.
There has also been success (although not as widely publicised) with higher-value B2B services. Here, some marketing teams have been able to put in place a structured sales mechanism that is owned and run by the function, with responsibility taken for the entire process, from identifying targets through to converting them into fee-paying clients.
In firms where this works well, the professionals are used as the ‘products’, enabling them to get on with what they do best – advising clients. This has required a change in mindset, which some have found challenging, but there are a number of notable success stories. Again, ROI is measurable and the bottom line difference that marketing makes is clear. The Fournaise results also don’t apply to many of these marketers.
In conclusion, marketing in professional services certainly has the potential to take a place at the top table, alongside IT and finance. However, in most cases, this will require it to rethink its role and focus on creating revenues and profits. Will it? Only time will tell, but those CEOs that understand the role that marketing can play and actively support it will certainly get a march on the competition.
Marketing is dead. Long live Marketing.