I attended VentureBeat’s GrowthBeat Summit in Boston yesterday, an event for marketing leadership across various industries to share best practices and learn about new trends in technology adoption.
In one of the roundtable discussions, an intriguing question was posed to the breakout group of 15 or so heads of marketing: What is the definition of a growth CMO?
- A growth CMO is a revenue driver, not a cost center.
I shared this opinion and it was echoed by several others. This is a battle of perception more than action and relies heavily on using performance data to substantiate claims. What is the ROI on the marketing budget overall and the specific major initiatives on the team? Are you measuring that ROI on contribution to revenue? Lengthy presentations on brand strategy, dark-rimmed glasses and hand waving are the antithesis of the growth CMO. Prove growth with data and the CEO will allocate more resources to a capital-efficient way of growing the top line. When marketing becomes synonymous with generating demand, particularly at a company that is attempting to grow rapidly, then your growth CMO will be around much longer than the two-year average of CMOs.
- Everyone in the marketing organization has common goal with measurable metric(s).
To make sure everyone is rowing in the same direction, every member of the team must feel empowered within their current role to contribute to achieving the common goal. For many growth CMOs, that goal should be new revenue. Several CMOs mentioned NPS as the growth goal, because for companies with an existing customer base the fastest road to organic acquisition is word of mouth. NPS seemed particularly important for B2C companies. For our team as a B2B enterprise software company, it’s all about net ARR growth.
- A growth CMO is tightly aligned with the head of sales and the CEO.
Tight alignment between sales, marketing and the strategic direction of the company are paramount. A great piece of advice I received a few years ago was “make your boss look good.” As the head of marketing, that means making the CEO look good when he presents to the board. It also means that my internal “customer,” the sales team, must look good when they are in selling situations. If we miss, hit or beat the number, the heads of sales and marketing own that together. A unified front requires communication and a level of service and humility (especially if you are re-programming a VP of Sales to not just like marketing efforts but to rely on them heavily for lead generation).
- Communicate to the board at their level.
Stick to the metrics that the board cares about. If you’re talking about growing reach, give aggregate figures across all (or relevant) social media channels. Get into the “how” only if asked. Better yet, a growth CMO can point to the exact place in the sales funnel that they are driving value and quantify it. For instance, “the marketing budget contributed $X of qualified new pipeline in Q2, which based on conversion metrics we expect to generate $X of revenue over the next 6 months.” Sometimes the board will ask for the “how,” but most of the time they simply care that growth is happening in a measured, predictable way.
- A growth CMO has a variable compensation structure similar the VP of Sales.
This is a passionate issue of mine. If you’re going to be a growth CMO you should want to be held accountable for growing and you should share in the rewards of even faster growth. Several examples were given where 25-33% of a CMO comp plan was variable and almost exclusively based on growth/goal attainment. This brings the CMO comp plan more closely in line with that of the CEO and VP of Sales, which helps to engender trust and alignment (back to #3). Plus, it ensures that the marketing budget is being aligned to growth metrics (back to #1). It’s about talking the talk and walking the walk. I’m more than just rooting for my head of sales—I’m strongly incented with my comp plan to assist wherever I can throughout the sales process. There is no “blind handoff” of leads if I’m paid to care about what happens throughout the cycle. And you should be hoisting the trophy alongside the rest of the C-suite when you crush the number.