The average tenure of a chief marketing officer (CMO) can be measured in months—about twenty-six months or less, in fact.Hallie Mummert, “Sitting Chickens,” Target Marketing 31, no. 4 (April 2008): 11. Why? Because marketing is one of those areas in a company in which performance is obvious. If sales go up, the CMO can be lured away by a larger company or promoted.
Indeed, successful marketing experience can be a ticket to the top. The experience of Paul Polman, a former marketing director at Procter & Gamble (P&G), illustrates as much. Polman parlayed his success at P&G into a division president’s position at Nestlé. Two years later, he became the CEO (chief executive officer) of Unilever.David Benady, “Working with the Enemy,” Marketing Week, September 11, 2008, 18.
However, if sales go down, CMOs can find themselves fired. Oftentimes nonmarketing executives have unrealistic expectations of their marketing departments and what they can accomplish.Quotes in this paragraph are from Kate Maddox, “Bottom-Line Pressure Forcing CMO Turnover,” B2B 92, no. 17 (December 10, 2007): 3–4. “Sometimes CEOs don’t know what they really want, and in some cases CMOs don’t really understand what the CEOs want,” says Keith Pigues, a former CMO for Cemex, the world’s largest cement company. “As a result, it’s not surprising that there is a misalignment of expectations, and that has certainly led to the short duration of the tenure of CMOs.”
Moreover, many CMOs are under pressure to set rosy sales forecasts in order to satisfy not only their executive teams but also investors and Wall Street analysts. “The core underpinning challenge is being able to demonstrate you’re adding value to the bottom line,” explains Jim Murphy, former CMO of the consulting firm Accenture. The problem is that when CMOs overpromise and underdeliver, they set themselves up for a fall.
Much as firms must set their customers’ expectations, CMOs must set their organization’s marketing expectations. Marketing plans help them do that. A well-designed marketing plan should communicate realistic expectations to a firm’s CEO and other stakeholders. Another function of the marketing plan is to communicate to everyone in the organization who has what marketing-related responsibilities and how they should execute those responsibilities.
Katie Scallan-Sarantakes develops and executes marketing plans for the Gulf States region of Toyota. Her path to this position is not unusual. Listen as she describes what she did to prepare herself for a position running a regional marketing office of a major global automaker.
- 16.1: Marketing Planning Roles
- Who, within an organization, is responsible for creating its marketing plans? From our discussion above, you might think the responsibility lies with the organization’s chief marketing officer (CMO). The reality is that a team of marketing specialists is likely to be involved. Sometimes multiple teams are involved. Many companies create marketing plans at the divisional level.
- 16.3: Functions of the Marketing Plan
- The actual marketing plan you create will be written primarily for executives, who will use the forecasts in your plan to make budgeting decisions. These people will make budgeting decisions not only for your marketing activities but also for the firm’s manufacturing, ordering, and production departments, and other functions based on your plan.
- 16.4: Forecasting
- Creating marketing strategy is not a single event, nor is the implementation of marketing strategy something only the marketing department has to worry about. When the strategy is implemented, the rest of the company must be poised to deal with the consequences. An important component is the sales forecast, which is the estimate of how much the company will actually sell. The rest of the company must then be geared up (or down) to meet that demand.
- 16.5: Ongoing Marketing Planning and Evaluation
- Our discussion so far might lead you to believe that a marketing plan is created only when a new offering is being launched. In reality, marketing plans are created frequently—sometimes on an annual basis, or when a new CMO is hired, when market dynamics change drastically and quickly, or just whenever a company’s CEO wants one. Moreover, as we indicated, a marketing plan should be something of a “living” document.