Marketing is now playing a more important role in fuelling the revenue engine of companies, given the increased sophistication of data-driven marketing and inbound lead generation tactics. Organisations serious about remaining competitive and understanding the changing nature of consumer demands need to bring marketing to the boardroom. But while Legal, Accounting, IT and HR are now firmly cementing their spots in the boardroom, the ‘Marketer’ has traditionally been the last to join.
So why is marketing still being treated like ‘the colouring in department’ and CMOs rarely offered a seat at the boardroom table?
Is marketing the missing piece?
As early as 2013, the notion of marketers needing to have a seat at the boardroom was raised by a paper issued by the Australian Marketing Institute (AMI) and Deloitte. The paper, Marketing's Role in the Boardroom – An Evaluation Framework for Boards and Directors, noted that in the age of digital disruption, boards have been far too slow to welcome marketers to the board room.
The report noted "For many organisations, marketing is the fuel that powers business strategy. It is intrinsic to how organisations develop and position their services and offerings, approach and deliver customer service and satisfaction, and to how they connect and communicate with other businesses and the community. Ultimately, marketing is critical to how organisations find and keep customers, make money and grow.”
Yet despite its importance, few organisations have still yet to grant marketing a seat at the boardroom table. In fact, recent reports how only 26% of CMOs regularly attend board meetings. Alarmingly, according to Spencer Stuart via Forbes, less than 1% of board seats in the Fortune 1000 have been held by active marketers.
According to the AMI report, one of the reasons for marketers missing at the board is because there remains an absence of a ‘clear, embedded formula’ for marketing effects on business strategy success, which makes it difficult to factor into board governance and oversight.
How marketers can add value to the board
There’s little point in arguing for a seat when the ‘table’ doesn’t understand what you’re saying. Marketers need to ‘learn the language of the table’ and clearly demonstrate how marketing can add value to a business.
Here are some tips to ensure you’re presenting marketing to the board in the most ‘palatable’ way:
Strategy and planning: Assess the alignment of your marketing strategy with overall corporate planning and financial objectives. Marketers also need to ensure all strategic planning has comprehensively identified major marketing economic, industry and environmental threats and challenges.
Capability and resources: Demonstrate your chosen strategy has the right resources, talent, technology and capability to support its execution.
Marketing assets: Explain the sources and value of your marketing assets including your company’s brand, customer base and partner relationships
Outcomes and objectives: Report on the right metrics and prove marketing is driving growth. Key marketing objectives and activities need to be explained to the board clearly, with results and commercial outcomes regularly shared to ensure full transparency and accountability.
Budget and investment: Speak the ‘financial language of the business’ and make hard business cases for spending. Evaluate period performance forecasts based on planned marketing investment, and assess whether proposed levels of investment in marketing assets are appropriate to realising wider business strategic plans. This is where the CFO can be your greatest ally.
Sales and marketing alignment at board level drives competitive advantage
Marketers being at the boardroom level really is the missing part of the equation and there’s a huge opportunity for organisations to get a real competitive advantage by having marketing leaders in the boardroom mix.
But it’s time to let go of the outdated notion that only ‘sales drives revenue’. When sales and marketing integrate into a robust revenue pipeline, so too does the ‘common language and metrics’, which ensures that goals, initiatives, and promotions are aligned across the departments. This in turn, can demonstrate to the board the value marketing can bring in terms of wider business alignment and competitive advantage.
This article was originally published in Marketing Mag.
This article was also featured in LBB Online, one of the world’s leading marketing news publications