The role of strategic marketing operations in addressing today’s top 3 CMO challenges

Pedowitz Group’s Debbie Qaqish presenting at the MarTech Conference in Boston.

Today’s B2B CMO is at a breaking point.  Working in uncharted territory, CMOs must respond to massive market changes and shoulder new responsibilities.

They are asked to lead wider company digital transformation and drive revenue and growth. CMOs are also tasked with leading the pivot to customer-centricity.

Any one of these initiatives represents an all-consuming project. But having three, at once?  This is a HUGE ask.

In working with many different organizations, I see a pattern.  CMOs who try to tackle these challenges with a sub-optimal marketing operations organization flounder. Those who tackle these challenges with the foundation of a strategic marketing operations function tend to survive, thrive and change the perception of marketing within their firm.

In this article, which touches on the same themes I explored in my recent talk at the MarTech East conference in Boston, we’ll explore these CMO challenges and discuss how a strategic marketing operations function enables success.

Definitions

I recently presented to the MBA class at the College of William and Mary for the ninth year. Every time I speak there, I explore the changes that B2B marketing is undergoing. Last year, I introduced students to marketing operations and I continue with that theme this year.

As I was preparing my class, I realized I needed to define the differences between a regular marketing operations organization and a strategic one in terms that non-experts could understand.  Here is what I shared:

The mission of a regular marketing operations group is to improve the efficiency and effectiveness of marketing through people, process, technology and data so that marketing can achieve operational goals.

This type of marketing operations organization is typically more reactive in terms of strategy creation, but serves a core function for marketing.

The mission for a strategic marketing operations group is to improve the efficiency and effectiveness of marketing through people, process, technology and data so that marketing can achieve strategic goals including:

• enabling digital transformation,
• adopting business accountability by driving revenue and growth, and
• leading customer centricity.

This type of marketing operations organization is proactive in terms of strategy creation and delivery.

Note the difference between the responsibilities of the two marketing operations organizations. That distinction set the tone for the remainder of my class, which was very focused on strategic marketing operations.

Let’s look at each of these CMO challenges and examine the role of strategic marketing operations in each.

CMO challenge #1:  Accelerating digital transformation

First, let’s be clear. Digital transformation is now a strategic imperative, not a nice to have.

Even with this level of importance to the future of the business, few executives believe their digital transformation is complete. Digital transformation is at the top of every CEO’s Christmas list.

A bright spot in this scenario is that marketing has been engaged in digital transformation since before it was cool.  The rise of marketing automation and other marketing technologies ushered in early use of digital technology to change how marketing addressed the marketing mix.

More importantly, the rise of the marketing operations capability — in response to the need for marketing to transform digitally — can now assist with wider digital transformation across the company, if it is a strategic MO group.

The role of strategic marketing operations is essentially to use technology and data to create new business models for how marketing responds to a rapidly changing business environment. In many companies, marketing’s early use of digital technology is now becoming a proof point for wider digital transformation.

Taking the marketing operations knowledge, experience and skills and including them in the wider digital transformation initiative jumpstarts the time it takes to digitally transform. Marketing operations as a core part of the digital transformation team can provide invaluable lessons learned around technology, data and processes:

• How to assess and buy technology.
• Describing the biggest integration issues.
• How to work with data.
• How to drive use of technology.
• How to measure the impact of the technology.
• How to optimize processes.
• Managing the change to digital

Any company beginning a wider digital transformation initiative would be well-served to include members of the marketing operations leadership team.

Question:  How is your marketing operations organization helping drive wider-company digital transformation?

CMO challenge #2:  Adopting business accountability

Nothing gives a B2B CMO more sleepless nights than how to drive revenue and growth.

According to a VentureBeat report about a CMO Council study in 2016, “35 percent of CEOs have high expectations that CMOs contribute to top-line growth, and 33 percent make the once-extraordinary statement that revenue generation is the primary mandate of marketing. Another 23 percent have moderate expectations along the same lines.”

This is interesting because marketing is drowning in technology and data – both precursors to financial accountability.

I’ve talked with countless marketing ops leaders about their accountability for revenue. I typically hear: “I make it possible” or “We enable the tools and processes so marketing can get to revenue.”  In most cases, these responses happen when the CMO does not have a quota or a revenue number and when marketing operations is focused on operational metrics.

In contrast, I recently worked with a MO leader and I asked him for his mission statement.  This is what he supplied:

“Create an environment that allows the global marketing team to operate efficiently and effectively, achieve optimal results, and drive revenue.”

The addition of “and drive revenue” was a change from his mission statement of the prior year. When I asked him about the change, he responded that marketing operations was now considered to be an engine for change as it related to implementing company strategies.

One of the big changes was that his CMO now had a number to deliver. Having a number versus enabling a number requires marketing operations to act strategically.

For example, for a strategic marketing ops group tasked with driving revenue might add a Revenue Analyst to the mix. This is a special data analyst who looks at all the data from across the entire customer lifecycle and helps marketing target the areas of biggest revenue potential and ROI. This is a very different mindset and a specialist skill set.

CMO challenge #3:  Leading customer experience

The CMO is now being tapped to also be the CCO (chief customer officer). CEOs are waking up to the reality that we live and work in the customer-engagement economy and the customer is in control.

This has forced a pivot away from being product centric to being customer-centric.  Customer experience is the new competitive battleground and by 2020, will overtake price and product as the brand differentiator.

Plus, customer experience pays big. Companies that make customer experience an investment priority have better revenue growth (59% vs 40%) and are more profitable (64% vs. 47%) than companies that don’t prioritize CX, according to a report by the Economist Intelligence Unit and Genesys.

This pivot to customer centricity requires the use of technology and data to understand the customer and to customize responses based on where they are in the customer journey and who they are talking with inside a company.

Insights must be gleaned from the customer data and shared with marketing and customer-facing groups within the company.  Responses and voice must be consistent and real-time. Customer-based, data-driven decision making becomes the norm. The CMO who is also now the CCO can’t do this with a regular MO group – this requires a strategic MO group.

I was working with a marketing ops leader for a few years and he has been pushing for his company to become customer-centric, to no avail.  Last year, the CEO decided to become a customer-centric organization.  The MO team was ready.  As a result, MO led the change and became viewed as a contributor to the creation of strategy and to the implementation of strategy.

Conclusion

I work with CMOs and marketing ops leaders every day.  The challenges of the CMO are bigger than ever.

At the same time, the opportunity for MO to step up from being button pushers to strategic contributors and enablers has never been higher.  It’s a matter of vision and motivation.

CMOs who succeed in accelerating wider digital transformation, who adopt financial accountability and who lead customer-centricity cannot do this with a regular MO group focused on operational measures.  They need a strategic marketing operations organization that envisions, and drives change through the magic formula of people, process, technology and data.  What kind of marketing operations function do you have?