The Fast Company Impact Council is a private membership community of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience. Members pay annual membership dues for access to peer learning and thought leadership opportunities, events and more.
For the last decade, chief marketing officers (CMOs) haven’t felt as appreciated and necessary as they once were. But that may be changing—I should stress “may.”
I’m thinking of the 2024 CMO Tenure Study by marketing consultancy Spencer Stuart. They’ve been issuing this study for two decades. Four years ago, the length of CMO tenure tightened to its smallest interval in more than a decade. In Spencer Stuart’s latest report, the average time spent by Fortune 500 CMOs in that job post in 2023 was 4.2 years, unchanged from 2022. While I wouldn’t say “flat is the new up,” stabilization after years of decline is somewhat positive.
A bit more context: Conventional wisdom has suggested that CMOs turn over more often than other C-suite leaders. But Spencer Stuart’s analysis shows that CMO tenure is just under the 4.6-year average for all C-suite leaders such as chief operating officers, chief revenue officers, chief technology officers, etc.
Still, CMOs are living in an “era of less,” according to a Gartner Marketing Practice study. Issued in May 2024, around the same time as the Spencer Stuart report, the GMP study notes that “in the four years preceding the pandemic, average marketing budgets were 11% of overall revenue. In the four years since, they’ve dropped to an anemic 8.2%.”
The roles of marketing and advertising appear more diminished than ever before. Meanwhile, ad agencies and brand marketing departments are under greater pressure and scrutiny to prove effectiveness. The essential quality of the CMO’s job is akin to an orchestra conductor; but instead of musicians, the role is to make sure companies and individuals act seamlessly and complementary.
But it’s not. There are reasons for that, good and bad.
Short-sighted efficiency
An ethos of efficiency has served as the defining, underlying feature of the advertising business for the last 25 years.
The ’60s were about pushing the boundaries of creativity. Advertisers and agencies wanted to impress everybody with the ideas, images, and messages bursting from Madison Avenue.
However, that shifted: The 21st century has been about personalization, speed—and above all—cost savings.
But it takes a larger advertising team to expertly handle all parts of the marketing funnel from discovery to purchase while simultaneously instilling brand loyalty.
The demands are, in fact, too complex for one agency, let alone one individual. As a result, specialists have divided the responsibilities associated with the multiple consumer touchpoints that need to be checked off.
So much for efficiency. If only there were a single individual who could organize, synthesize, and prioritize all those crucial tasks.
Oh, right. That’s what the CMO does. It’s what the CMO has always done.
Marketing’s “ah-ha” moment
Companies are increasingly recognizing this. There is solid value in developing marketing leadership from within. In 2023, 74% of CMOs of the top 100 advertisers were serving in their first corporate-level CMO role—the highest percentage since Spencer Stuart began tracking this data in 2016. Moreover, 59% of these CMOs were promoted from inside their companies.
This move toward internal promotion signals an “ah-ha” moment as the CMO role is rediscovered as the truly efficient solution to advertising’s largest problems. Institutional knowledge and recognizable authority are virtues worth keeping.
We might be witnessing a maturing perspective on marketing leadership. Organizations are investing in succession planning and management development specifically for the CMO role.
There’s even a higher opinion for the general marketing and management acumen a CMO possesses, Spencer Stuart data indicates. When external hires are needed, companies are showing greater flexibility, with 43% of CMOs recruited for Fortune 500 companies in 2023 coming from different industries, up from 37% in 2022.
Despite facing significant budget constraints—with 64% of CMOs reporting insufficient funds to execute their 2024 strategy per Gartner—there’s optimism about the potential of generative AI to expand marketing’s impact beyond traditional resource limitations. This technological evolution could help CMOs overcome the “era of less” while delivering more value.
As companies focus on developing their marketing leadership pipeline, they have an opportunity to increase diversity at the top by identifying high-potential leaders early and creating smoother development paths. Not only would that strengthen the CMO role, it also ensures marketing leadership better reflects the diverse audiences they serve, which helps build brand affection.
When consumers associate a brand with trust and other positive qualities, the path to performance and purchases is more immediate and direct. The intersecting lines of technology, branding, advertising, and sales all converge at the CMO’s desk. Perhaps it’s time agencies, platform companies, and the brands themselves showed more trust and value in the CMO role after all.
Tim Ringel is global CEO of Meet The People.
