Virgin Mobile CEO David Scribner takes shot at Telstra over CMO

Sydney panel: David Scribner

David Scribner

Virgin Mobile chief executive David Scribner has taken a shot at a major rival Telstra saying he is “flabbergasted” its newly appointed CMO will not report into the CEO despite it claiming to be customer centric organisation.

Whilst Scribner did not name the company the only rival telco to announce that particular structure is Telstra, whose newly installed chief marketer Joe Pollard will report into group executive Gordon Ballantyne rather than CEO David Thodey.

Speaking at the Secrets of Agency Excellence masterclass in Sydney this morning, the Virgin Mobile boss – a former CMO himself – said he gets “fired up” at the lack of power and influence most marketers have.

Asked on the likelihood of marketers rising to CEO or board level, Scribner said: “I really want it to happen. I am passionate about the profession and I think there has never been a better time for marketers to come to the forefront of thinking about growth and innovation.

“The customer has never had a greater voice so the marketer should never have had a greater voice. But I don’t see it happening in the Australian marketplace.

“In fact, one of my competitors put in a new CMO but failed to have them report to the CEO. You probably know exactly who I am talking about.

“This brand talks about being customer first yet fails to put their marketing head as part of the executive leadership team. I just find that flabbergasting.”

Boards and leadership teams want to get close to the consumer yet they do not have the key brand expert on the top table, he added.

“That’s what fires me up, the fact CMOs are not getting to the next level up,” Scribner said. “There is this absolute ceiling but I don’t completely put the blame on boards or CEOs.

“I think CMOs have to do a lot more for themselves to make sure they break through that ceiling. Without doing that I don’t know how a CEO can talk about the brand without having someone sitting at their right hand saying this is what we are doing with the brand. I am quite intrigued by that.”

To elevate their status, marketers must spend less time with agencies and more time with sales, finance and accounting teams so they can better understand hard measures. They should then communicate that to the agency, he said.

Scribner said one of the marketing challenges in the telco sector is to show greater innovation and to move away from a price message. Pursuing such a deal-led strategy could end in disaster, he warned.

“We don’t want to be an industry of a dumb pipe. Telcos in 10 years could easily be the next Kodak,” he said.

He admitted that telcos also do not have the same respect as banks among consumers, saying Virgin tries to avoid using the word telco, comparing it to a “five letter swear word”.

Scribner told delegates that agencies should get closer to the CEO and urged marketers to stop being “gatekeepers”.

He urged marketers not to blindly follow the brief handed to them by the previous CMO who was in the role for 18 months, who also inherited a brief from their predecessor. The cycle must be broken at some point, he said.

“I was talking to a very senior CMO at a top 10 ASX company and they said it’s really interesting because I inherited a colouring-in department, and I now have to turn them into a business growth innovation department,” he said.

“CEOs are not seeing their marketers give growth for innovation or ideas. They are not visionaries. You can be stuck in the day to day. The problem with the marketing department is that if they’re stuck in the day to day and 100 per cent the agency will be stuck in the day to day and they are not allowed to be visionary.”

Scriber also said the industry’s marketing is stuck in 2006 with “exactly the same plans”.

“What excites me is when it starts going from a mobile phone to lifestyle, because that is what the customer is using it for,” he said.

“The most exciting thing is how much evolution is going to happen with the phone and how the telcos will operate in that new paradigm.

“We’ve been lucky for a while. We’ve had premium pricing that’s been able to give us a little bit of headroom so we haven’t turned into the next Kodak, but that only lasts for so long.”

Steve Jones


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