Everything is Marketing: Why all CEOs should have marketing backgrounds
You know the typical corporate structure. There are a series of departments that handle discrete tasks and hopefully work efficiently and effectively together to create a greater whole. There’s a finance department, human resources department, IT department, production or manufacturing department and a marketing department.
Except, can you really compartmentalize and departmentalize marketing?
Everything a company does is marketing. Perhaps once, marketing was simply the 4 P’s — product, price, promotion, and place. Understand the product well enough so you can identify a target market for it, understand the price point they are willing to bear, and then promote the heck out of it in the right place … usually with a heavy emphasis on advertising.
But as Deepa Prahalad says in Why Trust Matters More Than Ever for Brands, “Consumers today are trying and bonding with brands through design touch points and their experiences, not through advertising alone … Advertising and marketing can amplify the success of a great design, but they can rarely compensate for a poor one. Here, trust is a function of the brand messaging lining up with the consumer’s actual interaction with the product or service.” (emphasis is mine)
(I read this article as a student in the University of Florida/MECLABS Institute Communicating Value and Web Conversion graduate certificate program).
Companies need to “wow” customers with every interaction
And this is why every CEO should have a marketing background. Because almost everything a company does has an interaction with the customer. So almost everything is marketing.
If the IT department can’t get the back-end systems right and it goes down when a customer is trying to make a purchase, that’s (negative) marketing. If the purchasing department buys wetlands and puts a store on it, that’s (negative) marketing. Or if the finance department creates a program to give 1% of profits to charitable organizations, that’s (positive) marketing.
To use an example from Prahalad’s article on trust, “SC Johnson going beyond the industry standard to be more transparent about the ingredients in its products” is marketing as well. And it’s not just the marketing department with its ownership of packaging design that makes something like this happen. It’s the chemists in the production department who are choosing ingredients that SC Johnson can be proud of because they cause less harm, and it’s the business process and technology department that builds the infrastructure to get and share this knowledge of product ingredients and create an organizational model to use the data.
How well companies perform during these interactions determines corporate valuation
Companies like Slack, Facebook and Square jumped out to quick and massive corporate valuations because of their ability to master the actual customer interactions. Apple, the biggest company in the S&P 500 with a $756 billion market cap, is built on actual customer interactions more than technology or supply chains. And if Steve Jobs isn’t the perfect example of the marketer as CEO, I don’t know who is.
But it isn’t just new economy technology companies that should be led by a marketer focused on maximizing these customer touchpoints. According to John Gerzema and Edward Lebar, about 62% of company value globally is intangible. And a key element of that intangible value is the brand (powered by customer goodwill). So a CEO with a background in creating a value proposition for customers — and delivering on it with everything the company does — could be the key many companies need to maximize shareholder value.
You can follow Daniel Burstein, Senior Director, Content and Marketing, MarketingSherpa and MECLABS Institute, on Twitter @DanielBurstein.
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Categories: Marketing b2b, Consumer Marketing, Marketing, marketing career, marketing strategy, Value Proposition
