Two major, global banks recently announced they are retiring the position of chief marketing officer. Is this the beginning of a trend, or merely isolated incidents?
Bank of America and Wells Fargo – two banks that both have more than $1 trillion in assets and operations that span multiple countries – made similar announcements this year that the CMO roles would be retired.
First to move was Wells Fargo, when it announced that CMO Michael Lacorazza was leaving the company and that the bank had no intention of replacing the role. Instead, it plans to decentralize the marketing department, opting to assign a marketing lead to each of its divisions rather than employing a team to oversee marketing across the company, according to various reports.
Bank of America, meanwhile, announced that its long-time CMO, Meredith Verdone, would be retiring and that the bank has no plans to rehire for the role. Instead, its 1,400-person global marketing team will merge with its digital team.
This trend — if indeed it is a trend — is not unique to banking: Johnson & Johnson, General Mills, and Uber — among others — have announced an elimination or merging of the CMO role. On the flip side, McDonald’s and Coca-Cola announced the elimination of the CMO role, only to rehire for it again afterwards.
Read More: How Bad CX in Banking Undermines Great Marketing
Elimination or Evolution?
Some argue that eliminating the CMO role and decentralizing marketing operations enables more efficiency and reflects a new way to reach potential customers.
Role Change:
Some say CMOs need to become data-driven overseers of the digital customer experience.
Evan Sharp, a consultant in the CMO practice at recruiting firm Russell Reynolds Associates, is quoted in AdAge as saying there is a “growing groundswell” to move away from the CMO moniker to reflect the new ways companies are reaching customers, including with data-driven personalized communication.
Sharp pointed to Hyatt Hotels, which eliminated its global chief marketing officer position, instead creating a chief commercial officer position that reports directly to CEO. The new position oversees a huge range of operations including loyalty programs, global sales, revenue management, distribution strategy, corporate marketing, communications, digital and customer-service centers.
In Bank of America’s case, its integration of marketing into digital is meant to foster a more seamless experience and “may also bolster its ability to drive digital personalization for customers,” Business Insider notes.
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Banking May Be a Different Case
Decentralizing marketing operations, however, may work better in industries other than banking, some say. In a blog on website AIThority, Bonnie Crater, CEO of marketing consulting firm Full Circle Insights, wrote that such an approach might work for enterprises that have units that operate in different sectors, such as a conglomerate with divisions that sell consumer appliances.
“But will it work for a company with an iconic brand like Wells Fargo [with] related lines of business?” Crater asks. “It will be a challenge unless someone makes sure customers have a consistent experience across all operating units and that the brand evolves as business conditions change. The person who takes on those duties doesn’t have to be called ‘chief marketing officer,’ but the functions are essential.”
A CMO By Any Other Name:
Someone must ensure a consistent customer experience across the institution. That function is critical, regardless of the title.
Crater concludes by saying that, “The bottom line is that the brand is inseparable from the customer experience. No matter what a company calls the person who is responsible for making sure the experience is consistent and meets customer expectations and marketplace needs, the function is critical. And that’s why every brand needs a CMO who can deliver on the company’s promise to its customers, regardless of title.”
Beyond Brand Ambassadors
Crater’s point reflects a growing theme. Increasingly, chief marketing officers are being asked to move beyond being just brand ambassadors, and embrace responsibilities related to improving the entire customer experience.
It’s a long-term trend. Bank CMOs are being asked by senior management more often to shift from their traditional focus on brand and marketing campaign management to growth and revenue generation.
Mission Creep:
Bank CMOs are increasingly expected to play a key role in growing revenue and overall business growth.
“Marketers must look globally at the customer experience, not just through the marketing lens,” states and article in ABA Bank Marketing. “For example: How does changing a process because of a technology change or compliance shift change the user experience? Connecting internal and external customers within a bank requires a working knowledge of and access to multiple systems, departments and data. In this way, marketing executives can become bank intelligence integrators, initiating data-gathering and analysis from all customer touchpoints and channels.”
Jeffry Pilcher, publisher of The Financial Brand and a marketing expert, says, “If I were running things, I’d put in a Chief Experience Officer and consider them in an EVP style role overseeing marketing, data analytics and retail delivery. But every organization needs someone at the top managing marketing strategy, and it isn’t wise to assign this as yet another item to someone else who has other — possibly conflicting or more important — priorities.”
Read More: Are CMOs Getting Left Out of Banking’s Digital Transformation?
An Ernst & Young report also hits upon this theme, and says the bank CMO of today must actually encompass five different roles in one: chief collaboration officer, customer experience officer, MarTech chief information officer, change leader and inventor.
“By combining these insights and capabilities, CMOs will be positioned to come up with new thinking that has the best chance to succeed,” the report states.
“In their new roles, marketing leaders will have the insights, expertise and relationships to be at the strategic center of the transformation of the financial services enterprise,” Ernst & Young continues. “The future will belong to financial institutions that deliver large-scale, intelligent personalization in ways that highlight appropriate aspects of service quality, reputation, pricing, products, and technology.”