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BriefBy Jonathan Becher

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NO. 15

What Every CEO Should Expect From Their CMO

WE ALL KNOW THAT CONSUMERS ARE DISRUPTING COMPANIES’ BUSINESS MODELS. ONE VISIBLE EXAMPLE IS THE INCREASINGLY POPULAR PRACTICE OF “SCAN AND SCRAM” (A.K.A. “SHOWROOMING”), IN WHICH CUSTOMERS BROWSE IN BRICK-AND-MORTAR STORES BUT USE THEIR MOBILE DEVICES TO FIND BETTER PRICES ONLINE.

Brief: What CEOs Need from Marketing By Jonathan Becher2 NO. 15©2013 SAP AG or an SAP affiliate company. All rights reserved.

According to comScore, four out of ten consumers “showroom” first then purchase online. Some retailers have attempted to counter this trend by rolling out price-matching guarantees. But discounting is not a long-term solution. Given access to information in the Internet age, low price is an indefensible strategy. At a time when business models are being continuously challenged, every customer must know exactly what your company stands for if you want to stand out.

For example, even though Target recently announced that it would match the prices of some online retailers, it has successfully staked out a position as “high design” (at an affordable price). Target understands that positioning means more today than a snappy tag line hatched by Mad Men. In a digital world, it’s no longer possible to have a gap between what you say and do. Everything, from the distribution network to the call center to R&D, must support a company’s positioning. It’s not just about consistency of message; it’s a matter of survival.

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Brief: What CEOs Need from Marketing By Jonathan Becher 3NO. 15 ©2013 SAP AG or an SAP affiliate company. All rights reserved.

POSITIONING IS NO LONGER A MARKETING PROBLEM, IT’S A COMPANY PROBLEM. THE CEO NEEDS TO CLEARLY ARTICULATE THE URGENCY OF THIS NEW REALITY AND UNITE THE ORGANIZATION. ”

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Said another way, positioning is no longer a marketing problem, it’s a company problem. The CEO needs to clearly articulate the urgency of this new reality and unite the organization. Marketing is strategically important to the follow through, both in terms of supporting the CEO in determining the right positioning and in becoming the glue that holds the different parts of the company together behind the promise. Why? Because armed with the voice of the market and an outside-in perspective, marketing is best equipped to help different areas of the company support the positioning.

However, many marketing groups are not ready to take on this kind of leadership role. They are trapped in their tactical silos, whether from a lack of skills, vision, or their place in the organization. Some tough love, resources, and air cover from the CEO will transform marketing from an order taker to a business driver.

Brief: What CEOs Need from Marketing By Jonathan Becher4 NO. 15©2013 SAP AG or an SAP affiliate company. All rights reserved.

To be that partner, marketing must embrace five key responsibilities:

Represent the voice of the market.Most employees see no tangible benefit in their silo or in their KPIs from listening to the market, despite all the bromides from CEOs imploring them to do so. Marketing understands (or should, anyway) the voice of the market in all its different forms, from customers (and

non-customers) to analysts to trending topics in social media and search. Marketing must be the cultural catalyst that gets the company thinking about the market.

Be the champion of the overall experience.When people interact with brands, they still have relatively fragmented experiences—online is different from in-store, etc. The social Web has increased the urgency of addressing this fragmentation because customers can quickly identify—and amplify—any inconsistencies

between what a company says it is (positioning) and how it acts.

Be the brand steward.This traditional marketing role has taken on a new twist because companies no longer control their brand. Instead, marketers must take on a more subtle role: working with

internal groups (such as customer service) to humanize the brand and influencing (rather than dictating) how those outside the corporate walls use the brand.

Capitalize on insights. For the first time, marketing has the ability to get a view of customers in real time. Using customer, market, and social data together, marketing can get a macro view (think crunching data on a scale unheard of a few years ago) as well as a micro view (think data equivalent of a

focus group) so that businesses can observe and react in the moment just like humans do. In retail it’s the instant offers in the aisles you’re hearing about; in other industries it could be adjusting territory and account planning on the fly. In high tech it could be serving up content in response to a person’s actions on the website. CMOs must learn how to apply both the art and the science of marketing.

Be an integrator and force multiplier across the company. Most large organizations are designed around any number of silos—by geography, product, or function. Marketing needs to rise above these divisions (including its own) and think

holistically about the company’s overall value proposition, integrating messages and insights across business units, geographies, and functional groups.

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Brief: What CEOs Need from Marketing By Jonathan Becher 5NO. 15 ©2013 SAP AG or an SAP affiliate company. All rights reserved.

The SAP Center for Business Insight is an organization that discovers and develops new research- based thinking to address the challenges of business and technology executives.

By doing these things, CMOs will see how the business model should change over time and play a role in helping make that happen. CEOs need to give them the permission to do that. Together, these five responsibilities add up to something very powerful: the ability for marketing to both visualize and evangelize the future.

Jonathan Becheris the chief marketing officer of SAP. He oversees the development and execution of the company’s marketing strategy across the globe.

More to come.WE WILL BE RESEARCHING AND WRITING MORE ABOUT MARKETING’S NEW LEADERSHIP ROLE IN THE ORGANIZATION THROUGHOUT THE YEAR.

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