The marketer's rise into the C-suite has been an uphill climb. Over the past decade or two, the role of "Chief Marketing Officer" in senior management has been hindered by persistent questions about the value of marketing and how to better manage the investments.
It's no surprise then that in a recent report, 80 percent of CEOs say they're not satisfied with the work done by marketers - while in comparison, 90 percent of the CEOs value and trust the work of CFOs and CIOs. More specifically, CEOs have serious concerns about the ability of CMOs to measure and drive return on investment (ROI) of marketing programs. And CMOs acknowledge the problem, with 57 percent reporting that they don't base their marketing budgets on any ROI analysis. Is it any wonder that the average tenure of a CMO has dropped to an all-time low average of 12 months?
But there is hope. The path to CMO redemption is grabbing hold of a data-driven, ROI strategy. Thanks to the new wave of digital marketing management tools, today's CMO has the ability to measure, normalize, and rationalize marketing programs - demonstrating a clear and compelling marketing ROI - to silence critics and build respect in the executive suite.
While the goal of ROI isn't novel, a new wave of products, people, and processes has emerged to actually measure ROI from media investments across channels, and act on it to reduce marketing waste and increase sales. Here's how to get started:
Beyond optimizing media investments, many of the best use cases for using big data to improve enterprise productivity are in marketing, giving CMOs a great opportunity to become strategic leaders running key CEO agenda items. Applications include site personalization, product recommendation engines, forecasting customer churn, and dynamic pricing and promotion management. Imagine your CEO turning to you, the CMO, to lead the firm's big data strategy.
Big data may seem daunting because big data is, well, big and complex. But with the right partners and right innovation agenda it's easier than you may think. Today's solutions not only handle the petabytes of data flooding past you, but more importantly quickly process it to create ROI. And in today's business reality, it's the speed of what you can do with the data that gives you competitive advantage.
Having a data-driven ROI strategy isn't a "yes" or "no" question. The real question is "when" and "how" you will embrace it. It's the only path forward for CMOs who want to - no, have to - start reinventing themselves in order to survive and thrive at the corporate leadership table, by building trust and demonstrating indisputable value with real dollars supported by real metrics.
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Mike Baker is president and CEO of DataXu. He has been pioneering digital media platforms for 20 years and is a widely recognized thought leader in interactive advertising. Before cofounding DataXu, he was vice president at Nokia, where he created and ran Nokia Interactive. Baker came to Nokia through its acquisition of mobile advertising leader Enpocket in 2007, where he was the founding investor and CEO. Baker was previously a partner at venture capital firm GrandBanks Capital. He has also been executive vice president at CMGI and Engage Technologies, an innovator in online advertising and behavioral targeting. Baker holds degrees in law and telecommunications management.
March 19, 2014