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The Fast Company Impact Council is a private membership community of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience. Members pay annual membership dues for access to peer learning and thought leadership opportunities, events and more. For the last decade, chief marketing officers (CMOs) havent felt as appreciated and necessary as they once were. But that may be changingI should stress may. I’m thinking of the 2024 CMO Tenure Study by marketing consultancy Spencer Stuart. Theyve been issuing this study for two decades. Four years ago, the length of CMO tenure tightened to its smallest interval in more than a decade. In Spencer Stuarts latest report, the average time spent by Fortune 500 CMOs in that job post in 2023 was 4.2 years, unchanged from 2022. While I wouldnt say flat is the new up, stabilization after years of decline is somewhat positive. A bit more context: Conventional wisdom has suggested that CMOs turn over more often than other C-suite leaders. But Spencer Stuart’s analysis shows that CMO tenure is just under the 4.6-year average for all C-suite leaders such as chief operating officers, chief revenue officers, chief technology officers, etc. Still, CMOs are living in an era of less,” according to a Gartner Marketing Practice study. Issued in May 2024, around the same time as the Spencer Stuart report, the GMP study notes that in the four years preceding the pandemic, average marketing budgets were 11% of overall revenue. In the four years since, they’ve dropped to an anemic 8.2%. The roles of marketing and advertising appear more diminished than ever before. Meanwhile, ad agencies and brand marketing departments are under greater pressure and scrutiny to prove effectiveness. The essential quality of the CMOs job is akin to an orchestra conductor; but instead of musicians, the role is to make sure companies and individuals act seamlessly and complementary. But it’s not. There are reasons for that, good and bad. Short-sighted efficiency An ethos of efficiency has served as the defining, underlying feature of the advertising business for the last 25 years. The ’60s were about pushing the boundaries of creativity. Advertisers and agencies wanted to impress everybody with the ideas, images, and messages bursting from Madison Avenue. However, that shifted: The 21st century has been about personalization, speedand above allcost savings. But it takes a larger advertising team to expertly handle all parts of the marketing funnel from discovery to purchase while simultaneously instilling brand loyalty. The demands are, in fact, too complex for one agency, let alone one individual. As a result, specialists have divided the responsibilities associated with the multiple consumer touchpoints that need to be checked off. So much for efficiency. If only there were a single individual who could organize, synthesize, and prioritize all those crucial tasks. Oh, right. That’s what the CMO does. Its what the CMO has always done. Marketings ah-ha moment Companies are increasingly recognizing this. There is solid value in developing marketing leadership from within. In 2023, 74% of CMOs of the top 100 advertisers were serving in their first corporate-level CMO rolethe highest percentage since Spencer Stuart began tracking this data in 2016. Moreover, 59% of these CMOs were promoted from inside their companies. This move toward internal promotion signals an ah-ha moment as the CMO role is rediscovered as the truly efficient solution to advertisings largest problems. Institutional knowledge and recognizable authority are virtues worth keeping.We might be witnessing a maturing perspective on marketing leadership. Organizations are investing in succession planning and management development specifically for the CMO role. Theres even a higher opinion for the general marketing and management acumen a CMO possesses, Spencer Stuart data indicates. When external hires are needed, companies are showing greater flexibility, with 43% of CMOs recruited for Fortune 500 companies in 2023 coming from different industries, up from 37% in 2022. Despite facing significant budget constraintswith 64% of CMOs reporting insufficient funds to execute their 2024 strategy per Gartnerthere’s optimism about the potential of generative AI to expand marketing’s impact beyond traditional resource limitations. This technological evolution could help CMOs overcome the “era of less” while delivering more value. As companies focus on developing their marketing leadership pipeline, they have an opportunity to increase diversity at the top by identifying high-potential leaders early and creating smoother development paths. Not only would that strengthen the CMO role, it also ensures marketing leadership better reflects the diverse audiences they serve, which helps build brand affection. When consumers associate a brand with trust and other positive qualities, the path to performance and purchases is more immediate and direct. The intersecting lines of technology, branding, advertising, and sales all converge at the CMOs desk. Perhaps it’s time agencies, platform companies, and the brands themselves showed more trust and value in the CMO role after all. Tim Ringel is global CEO of Meet The People.
Category:
E-Commerce
Unilever surprised investors on Tuesday by ousting chief executive Hein Schumacher and replacing him with finance chief Fernando Fernandez, who will focus on speeding up the execution of the consumer group’s turnaround strategy. Unilever’s board, which includes billionaire activist investor Nelson Peltz, was unified in its decision to oust CEO Schumacher, a source familiar with the board’s thinking told Reuters. Schumacher was surprised by the move, but the decision involved “nothing untoward”, the person said. In an email to associates, Schumacher defended his approach and record as CEO and said he regretted leaving the company earlier than anticipated. “The board is eager to step up the pace of our strategy execution and realise swift value creation underscored by a change in leadership,” he said in the email, which was shared with Reuters. The CEO’s sudden departure after less than two years in the job hit Unilever’s shares, which fell as much as 3.4% on Tuesday. They had gained more than 9% since Schumacher took the helm on July 1, 2023. The consumer goods industry has had a difficult time coping with a supply chain crunch triggered by the COVID-19 pandemic, plus sky-high commodity prices and an energy crisis after Russia invaded Ukraine. Profit margins have been squeezed and sales volumes hit by consumers switching to cheaper options. Unilever, which gave no specific reason for the CEO change, is facing pressure from investors to revitalise its fortunes and the top management upheaval comes just weeks after Unilever announced underwhelming full-year earnings. Nestle CEO Mark Schneider was ousted last year after several quarters of weak sales volume growth. Unilever’s management change was made after a board meeting on Monday, another source familiar with the matter told Reuters. The board concluded that Fernandez, who has been with Unilever for nearly 40 years, was the right person to execute the company’s strategy, the source said. Schumacher’s appointment and strategic changes had been welcomed by Peltz, who built a stake in the company in 2022 and sits on Unilever’s board. “We are gobsmacked at the news that Unilever’s very highly regarded CEO Hein Schumacher is to step down,” RBC Capital analyst James Edwardes Jones said in a note. When Schumacher became CEO, analysts and investors had applauded the choice of an external candidate as CEO. Schumacher reset the group’s strategy to address years of underperformance and laid out cost cuts last year, including plans to separate its ice cream division and cut thousands of jobs. The company has tried to step up the pace of asset sales, although some categories, like plant-based meat, are proving hard to exit. Chairman Ian Meakins said the board was impressed by Fernandez’s “decisive and results-oriented approach”, and had given him the task of executing the growth strategy. “There is much further to go to deliver best-in-class results,” Meakins said in a statement. Execution Analysts and investors said the news was unexpected, but Fernandez was a good choice to lead Unilever’s turnaround strategy. “We agree with the board that Fernandez is best placed to accelerate the value unlock,” Barclays analyst Warren Ackerman said in a note. UBS analyst Guillaume Delmas said “execution is key” in the new phase of the company’s strategic journey. Fernandez, 58, has been with Unilever since 1988. Before he became CFO last year, he held a number of roles such as President Latin America and CEO Brazil and President of the Beauty & Wellbeing business. Harsharan Mann in the Global Equities team at Aviva Investors, a Unilever shareholder, said: “We were surprised by the announcement but have a positive view of the CFO He is a 30-year veteran of the business who ran the Beauty and Wellbeing division very well.” In January, Fernandez took up extra responsibilities including overseeing supply chain and procurement. Unilever, which owns Hellmann’s mayonnaise, Dove soap and Ben & Jerry’s ice cream, said there was no change to its 2025 outlook or medium-term forecast and the board was committed to “further accelerating” Schumacher’s growth plan. Schumacher, 53, will step down as CEO in March and leave the company on May 31. He is leaving by mutual agreement, the company said. He will be treated as a “good leaver” and will continue to get his 1.85 million euros ($1.94 million) fixed pay until he leaves the business, the company said. He will then get an undisclosed payment for the remainder of this notice period, it said. Srinivas Phatak, currently Unilever’s deputy chief financial officer and group controller, will become acting CFO, while the company looks for a permanent replacement. ($1 = 0.9549 euros) Yadarisa Shabong and Josephine Mason, Reuters
Category:
E-Commerce
Small business owners felt more uncertain about the future in January, as they continue to deal with labor challenges and lingering inflation. According to a monthly poll of small business owners from the National Federation of Independent Business, the uncertainty index in January rose 14 points to 100 the third highest recorded reading, after two months of decline. The NFIB said small business owners are feeling less confident about investing in their business due to uncertain business conditions in the coming months. The response mirrors overall consumer confidence, which plummeted in February, the biggest monthly decline in more than four years, with inflation seemingly stuck and a trade war under President Donald Trump seen by a growing number of Americans as inevitable. In the NFIB poll, optimism fell by 2.3 points in January to 102.8, but remained high. Optimism surged after the presidential election, and the index still topped the the 51-year average of 98 for the third month in a row. Overall, small business owners remain optimistic regarding future business conditions, but uncertainty is on the rise, said NFIB Chief Economist Bill Dunkelberg. Hiring challenges continue to frustrate Main Street owners as they struggle to find qualified workers to fill their many open positions. Meanwhile, fewer plan capital investments as they prepare for the months ahead. Eighteen percent of owners reported that inflation was their single most important problem in operating their business, down two points from December and matching labor quality as the top issue. Labor remains a top headache. A seasonally adjusted 35% of all small business owners reported job openings they could not fill in January, unchanged from December. Of the 52% of owners hiring or trying to hire in January, 90% reported few or no qualified applicants for the positions they were trying to fill. And fewer small businesses are planning capital investments to expand their business. Twenty percent plan capital outlays in the next six months, down seven percentage points from December. Mae Anderson, AP business writer
Category:
E-Commerce
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