From CMO to CAO: How Marketing Can Get Its Mojo Back
When I entered advertising four decades ago, consumer marketing sat at the high table of consumer businesses. And as I recently wrote in a tribute article for Ulka’s legendary chief, Anil Kapoor, I was proud to be part of his team as he put Ulka at this high table.
Over the past decade, much has changed. Marketing itself, leave alone advertising, has lost its place at the high table of consumer businesses. Or so it seemed to me in my dealings with brand managers, CMOs and CEOs as a consultant.
A recent book by a marketing high priest confirms this notion.
In his recently released book, “Quantum Marketing: Mastering The New Marketing Mindset for Tomorrow’s Consumers.”, Raja Rajamannar, the chief marketing officer of Mastercard USA as also the president of the company’s healthcare business, has this to say in the opening chapter of his book: “. Currently, marketing is in a crisis. Many blue-chip marketing companies are fragmenting the 4 Ps of marketing (price, place, product, and promotion) and distributing them across multiple areas outside of marketing. Without the 4 Ps of marketing, you have to wonder what marketing actually does in these companies. Many of them are cutting marketing budgets. year after year, while reducing full-time employees in marketing continually, even laying off entire marketing departments. While brand building is correctly propounded by almost every company as being critical, there seems to be a lurking behavior amongst C-suite executives that brand marketing is probably fluffy and a wasteful activity that has no immediate impact, if any at all. In recent studies, 80 percent of CEOs say that they have no confidence in their marketing team,1 and 73 percent of CEOs said their marketing team members don’t have business credibility or the ability to generate growth. Many CEOs don’t see value in marketing, or the value that marketing… This crisis of confidence in marketing is the result of three dynamics. First, we have the big changes in the marketing landscape, driven by huge technology transformation, tremendous advancement in data analytics, and changes in consumer behavior driven by mobile and social media. Collectively, these have shocked business.”
Rajamannar, an alum of IIM Bangalore like me, goes on lucidly to paint a picture of a coming transformation that could threaten the discipline of classical marketing even more deeply. AI, IoT, VR, AR. — the list is long. Raja also prescribes in his book the steps marketing people must take to keep themselves relevant. Chief among them is to become technologically savvier.
That, of course, is true, and Raja’s book is a great and valuable read.
Along with all the technological change upheaval that Rajamannar writes about, marketing will need to adapt to a new generation of consumers — Gen Z.
The point I want to make in this post is that with this emerging new generation the classical marketing process of insight generation and creatively and pro-actively acting on these insights will be of increasing importance.
A situation that can, perhaps, restore the importance of marketing in most B2C businesses as the CMO morphs into the Chief Authenticity Officer (CAO)
Gen Z, born between 1995 and 2010, is the first genuinely digital native generation.
Most marketers focus on understanding the platforms and modes of communication when it comes to addressing Gen Z.
However, many credible psychographic studies of this generation have underlined the need for marketing to address a much more fundamental change,
Consider the study titled “True Gen: Generation Z and its implications for companies.” a November 2018 study by McKinsey&Company.
The study found Gen Z behaviours anchored in one element: this generation’s search for truth and authenticity.
Gen Zers value individual expression and avoid labels. They mobilize for causes. They believe in the efficacy of dialogue in resolving conflicts, and they seek to be analytical and pragmatic.
In their consumption habits, they seek authenticity defined by their individuality and the specific context of the product or service they are consuming.
This emergence of authenticity has set those who craft brand positioning and messaging for this increasingly important segment scrambling to deliver what they consider as “authentic vibes” in their brand positioning, brand personality and brand communications. However, they have run up against a significant obstacle — Gen Z, it emerges, as Ashley Deibert reports in a 2017 Forbes article, considers marketing itself as inauthentic!
The problem multiplies when modern marketeers and advertising mavens rush to interpret authenticity in entirely subjective and idiosyncratic ways. Creating messages that mostly leave the generations, they are targeting either cringing or derisively laughing.
The academic team lead by Joseph Nunes, a Professor of Marketing at the University of Southern California, developed a definition of authenticity built from the ground up through detailed consumer research.
They have reported their findings in the July 2021 issue of the Journal of Marketing.
Nunes and his team set out to model authenticity based on a study of consumer perceptions in contexts across the product categories and the at various stages of the purchase funnel.
They concluded that authenticity was a set of components, the weight of each defined by the context — the product category, the consumer segment and the stage in the purchase funnel.
Authenticity as a formative concept reflects the other key idea in marketing — brand equity.
Brand Equity, like Nunes’ definition of authenticity, is a construct of a set of components: Brand awareness, brand association, brand quality, brand loyalty and proprietary features.
Given under is the table outlining the six components that Nunes’ study posits:
The study finds that proficiency seems to be the most weighty component across contexts and legitimacy the least.
The study also found that the weights of the six elements vary across four key context poles:
- Product versus Service
- Hedonic versus Utilitarian
- Consumable versus Durable
- Extent of consumers’ co-creation of value (high versus low co-production)
For example, integrity as a component of authenticity is more critical in durable products than consumable products.
I contend that no amount of current or emergent marketing or advertising technology will deliver on authenticity. In fact, in extremis, the overuse of technology might detract from the perception of authenticity.
The aspiring CAO will need to go back to the first principles of the 5Ps and, instead of stalking faceless consumers as much of digital and social media marketing does, will have to anchor herself in the first principles of marketing — “know thy consumer, first-hand” and “the science of marketing, at its core, is art”
PS: The Nunes study white paper in the Journal of Marketing cites previous studies where researchers have defined authenticity in various categories and contexts. These include advertising authenticity (Becker et al.), brand authenticity (Morhart et al.), tourist sites (Grayson et al.), reality television (Rose et al.), classic car ownership (Leigh et al.), brand extensions (Spiagle et al.), creative goods (Valsesia et al.), culture (Vredeveld et al.), alcoholic beverages (Beverland et al.), social media influencers (Audrezeta et al.), and blue jeans & chocolates (Newman et al.). An interesting exercise for a CAO and her team would be to scan these studies to pick up pointers to define, structure and develop authenticity driving strategies and plans for their product categories and target segments.