The Weekend Mumbo: Has the market killed the CMO title?
Welcome to the Weekend Mumbo. Here you will find a short analysis piece on something compelling that happened during the week, followed by a small collection of the biggest stories Mumbrella covered and why they are worth the read.
Last week my colleague, Mumbrella news editor Calum Jaspan, wrote about the big hire that you probably missed. This week it’s appropriate to continue the talent theme but twist it slightly to the big hire that more and more businesses may miss.
That’s the CMO.
As we continue down the economically uncertain rabbit hole that is 2023, it is worth taking a look back to the recent past to see if there could be a continuation of a trend that seemed to be stopped in its tracks by the pandemic.
Now you CMO me, now you don’t
Back in 2019 a raft of articles appeared in US trade media centred around the extinction of the CMO.
In July of that year AdAge’s E.J. Shultz wrote: “Chief marketing officers, who have among the shortest tenures in the C-suite, are used to pressure. But now their very existence is coming under threat. Several big-name companies have recently done away with the CMO position altogether—including Johnson & Johnson, Uber, Lyft, Beam Suntory, Taco Bell and Hyatt Hotels, accelerating a trend that began a few years ago.”
That year McDonalds in the US had also shed the CMO role.
Collins and Australia Post parted ways – with no replacement
Not more than a week into 2023 and we had our first example of a CMO role that was to be no more. Calum got the exclusive on Australia Post CMO Amber Collins departing, with no replacement.
Soon after, it was followed by news from Booktopia that CMO Steffen Daleng was included as one of at least 30 redundancies at the online book retailer. It went public in December 2020 and the stock has been on a significant downward trajectory for much of that time.
In mid-2021 Daleng had restructured the marketing team significantly. Despite growth in some metrics, the only result that really counts for a listed company is stock value, and it dropped from a high of $2.92 near listing to be sitting at $0.28 as I write.
An announcement from Booktopia stated that “the Company has optimised its advertising program to focus more on high-conversion channels. This is expected to deliver $1-2 million per year in cost savings”.
Booktopia’s share price is creeping up ever so slightly – the market seemed to be cautiously optimistic. But it sounds somewhat like ChatGPT is going to be writing the marketing strategy.
Two swallows do not make a summer as I understand, although I have no experience of growing up in a country where swallows determine the presence of summer. To provide the other side of the argument, other key CMO roles such as Coles look set to be filled (although there is rumour that this role may be vastly different to when Lisa Ronson occupied it).
But it does beg the question: should the industry be reconsidering the value and position of the traditional CMO role? Has it already? Some I have spoken to argue that there are too many high profile CMO roles that don’t report directly to the CEO. Think Optus or Telstra, for example.
While these are behemoth businesses and there could be an argument that the marketing function is high up enough within them, the counter argument would be that it is undervalued. In the case of Optus, marketing and communications would now be priority number one, you would think.
Optus is currently without a top marketer in place
A few Mumbrella journalists and myself canvassed the market this week off the back of more senior moves in the industry to see what the sentiment was like. It essentially boils down to this – certain marketing budgets are being condensed, some more quickly than others. That will undoubtedly affect roles, and the quickest way to make a saving is to cut from the top.
That will, of course, have a knock on effect on agencies and media owners this year, but it is likely to mean smaller marketing teams at brands as well.
But this isn’t the start of the revolution. The CMO role has always been on rocky ground, not least because of the long spoken about statistic that has it as one of the shortest tenured roles in the C-suite.
There has already been a push to steer away from the standard CMO title and look to name it more accurately, including the use of key terms like ‘customer’, ‘engagement’, ‘consumer’, ‘audience’, ‘growth’ and more.
It’s a smart move, and one that should make the role even more valuable to the business. More reason for a direct report into the CEO or a spot on the leadership team or board?
Consider this. CMO’s annual CMO 50 list features just 20 marketing leaders who actually hold the specific title of CMO.
What does that say about the once traditional title of CMO and the role expected of the incumbent?
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