At one international hospitality company, the CMO’s purpose was narrowly defined as bringing in new guests to hotels. The marketing department excelled at this, achieving record levels of customer acquisition. But the team had no idea what happened after a new customer visited a hotel for the first time. Did they return? Did they engage additional services at the hotel? Simply put, the marketing department had no visibility into the CLV. This siloed approach meant the CMO was being judged on marketing effectiveness without having insights and influence over the entire customer journey, leading to a critical disconnect. The company’s expected value per customer was only $80, even though it was spending more than $100 to acquire each one. Every new customer was destroying value. This highlights the need for marketers to think holistically about growth and to focus on delivering strategic business outcomes, not just narrow, tactical ones. “I know that I have to connect the work that my team is doing every day to how we perform,” Tory Pachis, executive vice president and CMO at Amica, tells us. “We need to make sure we are using the latest marketing tactics but tying them to business outcomes.” Crafting a measurement system through C-suite partnership and alignment Operational KPIs in marketing can sometimes be a veritable alphabet soup. There’s ROAS (return on advertising spend), CTR (click-through rate), CLV, TOP (time on page), CPC (cost per click), SQLs (sales-qualified leads), and more. These metrics are crucial for day-to-day marketing operations, but they don’t help communicate the broader business impact in a way that resonates with other C-suite executives. Most executives, including the CEO, don’t fully understand, for example, how to convert a CTR into incremental revenue. Why should they? Enter the CFO, the “numbers” person whose duty is to assess the viability of investments across the organization with a healthy skepticism. CFOs’ numbers are rarely questioned, and their imprimatur can lend credibility to marketing metrics that are clearly tied to greater business goals. To reconnect marketing to its company’s growth engine, the CEO should make sure that the CFO and CMO partner together to refresh measurement systems across the enterprise. “The relationship between the CMO and CFO is critical to the success of a business,” notes Fortune Brands Innovations’ Richer, who says he’s had good relationships with CFOs across his career. “I work on it. It’s not just one magic presentation that lays it all out. CMOs have to put forth the right data, work on the relationship, and build trust. It becomes a positive human dynamic for the business if you do it right.” These two functions need to work together to prioritize KPIs, identify the metrics that truly matter for both short- and long-term objectives, align on how they are measured, and, most importantly, ‘The relationship between the CMO and CFO is critical to the success of a business.’ —Mark-Hans Richer, executive vice president and CMO, Fortune Brands Innovations 9 The CMO’s comeback: Aligning the C-suite to drive customer-centric growth