What will it take for these CMOs to succeed in their new gigs? From my experiences in overseeing marketing departments at two high-growth B2B companies, I have some insights on what it takes to lead a growing team to success. Whether you're a new CMO or an aspiring marketer who wants to climb the ladder, here are three rookie mistakes to avoid:
Mistake #1: Focusing On New Acquisition At The Expense Of Retention
Many of the marketing tactics that get a lot of attention—content, email, and advertising, for example—are focused on lead generation and new-business acquisition. We all know, however, that retention is key to long-term profitability. A Bain & Company and Harvard Business School study concluded that increasing customer retention rates by 5 percent increases profits by 25 percent to 95 percent. As this study shows, keeping your current customers is cheaper than finding new ones.
So how do you reduce churn? It’s by forging close emotional ties with your customers, not by pushing sales messages down people’s throats. It’s by truly getting to know your customers, not by making assumptions about their lifestyle, attitudes, and outlook. It’s by building an online community to make decisions that are based on customer feedback instead of simply doing what you’ve always done. For marketing teams to be able to come up with marketing campaigns that actually provide value to current customers, CMOs need to lead the charge in understanding what their audiences truly care about.
Mistake #2: Ignoring Your Sales Counterpart
Research shows that most marketers are struggling with sales enablement. This is a problem because marketing’s job is to connect potential customers with the sales team. Not working closely enough with sales results in wasted efforts because the lack of integration means you’re not converting prospects.
That’s why rookie CMOs should make it a priority to grasp what makes a good lead. You do this by establishing criteria that both marketing and sales can agree to—by considering your business goals, your industry’s buying cycle, and your company’s positioning.
Using that information as a starting point, CMOs can then engage current customers to dig further: Why did they choose you over your competitors? How are buying decisions made in their organizations? What needs are your products currently not meeting? Since sales is increasingly moving from a solution-driven approach to an insight-driven one, what your customers tell you can provide the information that both marketing and sales teams need to develop the right message.
Just like their B2B counterparts, marketing leaders in B2C companies need to get closer to their customers to understand where their brands can provide more value.
Mistake #3: Taking On Brand Loyalty Alone
Traditionally, marketing KPIs have been closely tied to brand loyalty. In theory, since branding is a marketing exercise, anything related to the brand should be marketing’s responsibility.
However, brand isn’t just a marketing thing. It is owned by the business, so it's something that everyone should own. Understanding your company’s story and its unique value proposition starts from the CEO. CMOs share the responsibility of fostering brand loyalty with the rest of their organizations.
That said, someone needs to champion the brand within an organization, and marketing is in a great position to do that. But, in addition, CMOs need to help the entire organization understand that brand loyalty is driven by great customer experiences across all touch points. This begins by understanding the customers deeply and making the necessary changes to improve customer experiences.
What new CMOs will discover quickly is that their roles are both exciting and challenging. From social media to insight communities, from wearable tech to smart appliances, the opportunities to engage and learn about your customers continue to grow every day. By putting customer retention and sales enablement first, new CMOs have a better shot at establishing themselves in their new positions quickly and, more importantly, proving value to the organization.