CHICAGO: A study by executive search consulting firm Spencer Stuart reveals that the tenure for CMOs at top consumer companies continues to decline, which often leads to marketing agencies having to defend their business sooner than expected.
The average tenure for CMOs in 2006 was 23.2 months, down from 23.5 months in 2005 and 23.6 in 2004.
"Three years ago, we began to see this incredible turnover happening; we thought it was a fluke," said Greg Welch, head of Spencer Stuart's marketing officer practice. "We began to build a baseline in the study three years ago and the reality is that the numbers have not deviated."
The study is based on publicly available data about CMOs at 100 consumer brands, determined by Spencer Stuart.
"The changes drastically affect everyone if the CMO shows up and immediately calls agencies up for review," Welch said. "Since agencies run the risk of losing the account, they have to spend time keeping business or spend time reeducating the new CMO. It's a painful experience. There's an uncertainty regarding what the new CMO is looking for and [where the agency is] in jeopardy.
"We caution [new] CMOs, ‘Don't assume everything before you was bad. Don't [feel you need to switch everything up] during your first 90 days on the job,'" he added.
Welch noted that the high rate of CMO turnover is due in part to the fact that more CEOs are being picked from finance and operations divisions.
"Very few of today's CEOs are coming from marketing," he added.
While Welch did not have scientific data on what led to the high turnover, he said anecdotally a lot of clients he represents come from situations where CMOs were likely encouraged to look for employment elsewhere.
"It's difficult to tell, but with a majority of CMO engagements we're working on now, we were brought into situations that were not healthy," he said.