Marketing and corporate communication should be strategically based
Marketing is more important than ever before in the increasingly complex and difficult organizational environment caused through continuous internal and external change.
Globalization, the internet and the increasing availability of information have led to more demanding employees and customers. Customers are expecting progressively more customized goods and services, which means organizations are less able to forecast the direction of their markets. These factors have increased the cost and complexity of doing business and have put pressure on marketers to understand customer needs better, to secure greater profitability and to measure outcomes better than previously.
Many CEOs expect marketers to be strategists. According to McKinsey consultants, chief marketers must address several other areas in addition to their traditional role. They should lead company-wide change in response to changing buying patterns, increasing efforts to shape a company’s public profile, managing complexity, and building new marketing capabilities throughout the company as a whole in addition to increasing customer loyalty and retention.
However, most marketers have been heavily tactical and disconnected from the CEO agenda. Not all this problem lies with them, because in many cases leadership teams confronting organizational barriers often try to redraw the boxes and lines of their organizational charts. But that leads to incomplete solutions at best, because it risks simply creating new silos, according to an article, “Decision-driven marketing” in the July-August 2014 issue of the Harvard Business Review. This is no help to CMOs.
A surprising number of CEOs believed marketing’s most important contributions lay in areas not typically associated with the function, such as pushing for innovation and encouraging cross-functional collaboration, ie increasing communication between different areas in the organization. Yet studies have found marketers remained focused on their traditional low-level activities of building brands, advertising and perhaps social media campaigns, and market research.
Marketers’ area of focus as a percentage
- Branding guidelines 83%
- Advise operating divisions 52%
- Share best practices 52%
- Develop capability 47%
- Drive growth 46%
- Drive CEO agenda 37%
- Drive innovation 35%
Source: ANA/Booz Allen Hamilton marketing organization survey
These types of studies find that few of the issues important to CEOs were also the priorities of marketers. What’s worse is that marketers have not been able to talk to senior management in their language about the financial return on investment (ROI) from marketing. Marketers were still using ‘soft’ terms like awareness, cost per incremental volume, share of market, and growth. This has created pressure on marketing.
A familiar lament
Does this discussion have a familiar ring? It does indeed! It sounds very similar to the travails of public relations practitioners. Surveys show that PR practitioners and non-PR practitioners agree that public relations is growing in importance. However, too many PR people still focus on the short-term tactical agenda to the exclusion of the longer-term strategic fundamentals.
As a result, a high proportion of PR people are not aware of the priorities of top management and may find it difficult to justify the importance of their role to the organization in the long run. Despite successes in day-to-day activities like product publicity and event management, they tend to find that senior managers want more – they want a more strategic contribution from the PR area.
Furthermore – too many PR people justify their efforts in terms of ‘soft’ measures such as media coverage, reputation and attitudes rather than ROI, stakeholder decision-making and behavior change, which is the hard-edged terminology used in the executive suite. A typical soft measure of PR success is the extent of positive media coverage. Good media coverage is all very well, but it gives no insight into actual customer decisions and actions because media are only a conduit, a means to an end; the media themselves are seldom key customers and decision-makers in their own right. Social media causes similar problems – volume of traffic and ‘likes’ don’t necessarily increase sales or profitability.
These leave PR pros very exposed to disdain and criticism from executives and consultants. For instance, a McKinsey consultant in a 2007 article, “The evolving role of the CMO,” refers to the corporate affairs function typically reporting to “a corporate secretary.” And also “most corporate-affairs executives don’t have the background to lead this type of [strategic] effort and therefore increasingly turn to their marketing counterparts for assistance.”
The competition between PR and marketing certainly continues. So it is in your interest as a public relations pro to strengthen your relationship with marketers in your organization. Better to hold your competitors, if not enemies, close! Being aware of marketing plans will enable you to play a more effective PR role by insisting on being part of the marketing planning process from the beginning.