Hierarchies rule the corporate world and one of the most prevalent structures has become the position of the marketing function under the CRO. People will say it creates unified revenue tracking which streamlines objectives and efficiency. However, this perspective overlooks critical distinctions between sales and marketing. If that is something which continues to be, it leads to strategic misalignments and compromised brand development.
The Fundamental Flaw: A Sales-Centric Viewpoint
We can all say that sales and marketing are closely linked in their goal of driving revenue. However, they split up when we look at their methodologies to generating revenue. Marketing’s scope extends beyond immediate revenue generation, encompassing brand building, market research, customer engagement, and long-term value creation. When subjected to a sales-centric approach, these essential elements risk being overlooked.
Imagine the scenario of allocating resources. When a company has the choice between hiring an additional sales rep or allocating funds to marketing initiatives, a sales-learning CRO might lean toward augmenting the sales force. This will yield short term gains, which for some isn’t a bad thing. However, it neglects the strategic benefits of marketing investments that nurture long-term growth and brand equity.
The Unintended Consequence: Diminished Marketing Influence
While there’s other issues, placing your entire marketing operation to report to the CRO leads to some sort of unnecessary bureaucratic layer between marketing and the CEO. The CRO then has no insight into the branding or marketing that’s going on. There’s a few reasons a CEO shouldn’t have such a distant view from any of the marketing insights.
Brand Narrative Control: The CEO, as the organization's chief storyteller, should have an intimate connection with the brand narrative, a connection diluted when marketing reports through a sales-focused CRO.
Market and Customer Insights: Direct interaction with the marketing function enables the CEO to stay attuned to market dynamics and customer needs, fostering more informed strategic decision-making.
Balanced Investment: A direct line to marketing helps ensure a balanced allocation of resources between sales and marketing, recognizing the distinct yet complementary roles each plays in revenue generation.
Appropriate Budgeting: Without the CEO's direct involvement, marketing may struggle to secure the necessary budget to execute its strategic vision effectively, potentially stunting growth and innovation.
The Exception, Not the Rule: The Rockstar CRO
CROs are still important and they do have a role in leading sales and marketing channels. Those that are absolute sharks in the field can bridge the gap between the two functions, ensuring that marketing’s strategic value is recognized and nurtured. However, this is uncommon – I guess we can say sadly. Organizations should be more cautious about banking on finding such a rare person to fill the CRO role.
The Optimal Path: Marketing's Direct Line to the CEO
The potential of marketing should operate with a direct line to the CEO. It allows marketing to have its voice heard at the highest levels and facilitates a balanced approach to revenue generation which incorporates both immediate sales as well as long-term brand building. Investments in brand equity, customer experience, and market innovation are more likely to be brought about with a CEO-led marketing function. Overall, it will establish and drive more growth.
While the allure of a unified revenue organization under a CRO is understandable, the practical implications often fall short of expectations. By recognizing and respecting the distinct roles and contributions of sales and marketing, organizations can foster a more balanced, strategic approach to growth that leverages the strengths of both functions. The path to sustained success and market leadership lies in ensuring that marketing has a seat at the executive table, directly contributing to the organization's strategic vision under the CEO's guidance.
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