Eyebrows were raised last month when Johnson & Johnson dispensed with its CMO role and said goodbye to high-profile incumbent Alison Lewis.
Lewis moved to the pharma and CPG giant in 2013 from Coca-Cola, but J&J said in a statement announcing her departure that it had "established a new business model that streamlines priorities, allows us to operate more efficiently and increases our investment in categories that offer high potential for growth and where we can make a positive impact on consumers’ lives."
Somewhat improbably, Lewis claimed in the statement that her leaving and the post being eliminated was "a proud moment for me."
She added: "I’m ready to pass responsibility to a marketing organization that is agile, close to the consumer and one that possesses a contemporary skill set that will help the consumer business grow in this rapidly changing environment. I was brought in to be a change agent, but the talent and passion of the team at Johnson & Johnson also changed me."
In 2017, J&J had reorganized its consumer business into 10 lean, multidisciplinary "squads" centered on consumer needs including pain relief and oral care. It had restructured its agency support to align with this new structure.
Also last month, another high-profile company that decided to say goodbye to the CMO function was Uber, when Rebecca Messina departed her role after less than a year.
Like Lewis, Messina was also a veteran of Coca-Cola, where she spent 22 years, and had most recently worked at Beam Suntory before joining the embattled ride-sharing app company as it looked to dig itself out from the Travis Kalanick years under new CEO Dara Khosrowshahi.
The absorption of CMO responsibilities elsewhere within these companies is, on the surface, good news for the respective communications leaders - Michael Sneed at J&J and Jill Hazelbaker at Uber – who both assumed larger roles in the new structures.
Uber competitor Lyft is also getting rid of its CMO and the latest high-profile company to follow suit is McDonald’s, where former Unilever and Bacardi marketer Silvia Lagnado is departing in October and will not be directly replaced. Her responsibilities are being split between Colin Mitchell, SVP of global marketing, and Bob Rupczynski, SVP of marketing technology.
So what’s going on? What does it mean for the marketing functions within brands and corporations? And what does it mean for agencies who have identified the CMO as their target audience for future growth?
It set me thinking about the famous Gartner survey that predicted CMOs would spend more on technology than CIOs by 2017. This was presented as proof of the increasing importance of the CMO function and the firepower it would add to their budgets.
But with the onset of the trend toward in-housing of marketing services, principally driven by technology such as programmatic advertising and direct-to-platform relationships, perhaps the trend is working in the opposite direction. It’s possible it has actually proved detrimental to the future of the CMO function and maybe the C-suites would prefer CIOs to have a bigger say in all these significant technology investments.
The fact is that any large tech investement now has to go through the IT department for security reasons, especially in compliance-intensive sectors such as finance, pharma, government and technologies such as SAAS (software as a service).
The consumer space is slightly different and can be more agile, but that spending has moved into the realm of marketing operations, which explains the elevation of martech specialists such as Rupczynski at McDonald’s.
The IT mindset is much more aligned with product and sales marketing than it is with the medium- to long-term brand strategy/health and digital transformation priorities of centralized marketing teams.
Dentsu Aegis Network’s CMO Survey 2019, released this week, spoke to 1,000 CMOs and senior marketers across 10 countries. It found that four out of five CMOs believe they must transform their businesses through digital technology, have invested heavily in doing so, but haven’t yet delivered on its promise.
The tenure of the CMO is notoriously short. Recruitment firm Spencer Stuart’s latest data shows median tenure in 2018 was just 27.5 months, down from 31 in 2017.
It’s not surprising then that nearly half of those surveyed in Dentsu’s research say they plan ahead for two years or less (what's the point in doing otherwise?) and that, ipso facto, this impacts the lack of long-term thinking that transformation usually demands.
The focus is on measurable ROI and optimization and almost two out of every three CMOs surveyed expect even more pressure to demonstrate tangible short-term results in the next two to three years.
There is a devolution away from, and less need for, centralized marketing departments and CMOs and a movement in the direction of product marketing heads who are closer to the money. In time, there will be less and less distinction between sales and marketing.
Smart agencies will be building relationships with CIOs and product marketing leads at their clients and sales prospects, and hiring people who speak the same language.
But before companies completely sound the death knell for the CMO position and place all their eggs in the CIO and product marketing basket, a word of caution is probably required.
Some of you may have seen a series of online ads in the Salesforce Trailblazer series, one of which focuses on Hitachi Ventara and its CIO Renée Lahti McKaskle.
This one has popped up on my content feed multiple times recently and after repeated viewings I still don’t understand what it’s on about.
This is how CIO Lahti explains her company’s mission: "It’s really amazing in the industry today, because you’re integrating cloud solutions, niche solutions that have those vertical or expertise. You take advantage of disruption. You take advantage of the chaos that’s happening in the marketplace. And I think Hitachi Vantara and our transformation program called Mirai - we’re going to demonstrate that in spades."
If anyone can translate what this means into plain English I’d be delighted to be schooled, but to me it’s just an example of the difficulties tech specialists have in communicating. Anyone who has seen a press release from a heavy tech-oriented vendor will know what I mean.
CIOs and techies just don't tend to have the same storytelling and communications smarts as CMOs, brand marketers and communications pros.
Clearly this is one isolated example and we all know technology is going to play a bigger and bigger role in marcomms moving forward.
But let’s not throw the baby out with the bathwater and completely hand over the storytelling function of brands and companies to robots.