John Wanamaker is dead, and he didn’t go recently. The department store pioneer passed away almost a century ago, in 1922.
But his words live on, especially in the marketing world. Wanamaker reputedly said, “Half the money I spend on advertising is wasted, the trouble is I don’t know which half.”
As a testament to how hard it has been to measure success in advertising, that phrase has had a long shelf life. For decades marketers used Wanamaker’s words to shrug their shoulders as they justified spending on tactics they believed were working—even though they usually couldn’t prove it.
But the phrase may soon be as dead as Wanamaker himself. As targeting and measurement capabilities have rapidly grown over the past decade, systems were developed with the ability to solve the very problem Wanamaker so famously lamented.
In a recent Digital Marketing Remix webinar on marketing metrics and attribution, DocuSign VP of Demand Generation Meagan Eisenberg was asked if the Wanamaker motto still had relevance.
“I definitely think the quote is obsolete,” Eisenberg said. “When it comes to online marketing, I feel confident that the metrics, tracking, and technology we have today can prove what spend is working and what spend is not.”
For example, marketing automation platforms now enable marketers to quickly assess whether their branding and nurturing programs are driving conversions and generating revenue.
Yet, it’s not just marketing automation software that’s enabling marketers to understand and communicate with their customers more effectively than ever before. The entire marketing stack—marketing automation systems, analytics software, data management platforms, CRM, and content management systems—is making the marketing department stronger than ever.
With the marketing stack’s software systems providing data, CMOs and the departments they lead have more insight into customers than any other person or organization in the enterprise. That’s due in large part to how the buyer’s journey has changed in the Internet age.
Some consultants say that the buyer’s journey is up to 90% complete before he picks up a phone to call a company salesperson. These days, analyzing a potential buyer’s interactions with the marketing stack is one of the few ways that an enterprise can read a prospect’s “digital body language”—as Steve Woods, cofounder of Eloqua, has termed a prospect’s interaction with websites, social media, and other digital platforms.
Using the constant flow of data from ecommerce sales, CRM systems, marketing automation platforms, and other back-end marketing software, CMOs now have a 360-degree view of the customer. This data can be used not only to serve prospects and customers the right message at the right time, it can also be used to anticipate and create the products the market needs before anyone else—even before the customers themselves know they need it.
Because of this increasing importance of software to the marketing department, Gartner has projected that the CMO will spend more on IT than the CIO by 2017. Many CMOs, such as Motorola Solutions’ Eduardo Conrado and ServiceSource’s Christine Heckart, already oversee both marketing and IT. This dual role for the CMO reflects how central marketing data is becoming to the financial health of business.
Not only will the role of the CMO become more critical for corporations, I believe that former CMOs will be front and center in the next great crop of CEOs. This trend is already taking shape: Royal Dutch Shell, Audi, Mercedes-Benz, and others have all recently named CMOs as their chief executives.
The movement of CMO to CEO is inevitable since other executives don’t have the same amount of power to understand and solve customer problems, create brand loyalty, or move shareholder value today as quickly or as effectively as the CMO. Through the years, many perceived marketing as the unmeasured “toy department” of the enterprise. The rise of data and the marketing stack is bringing newfound importance to the CMO and her staff, and this will lead to the CEO office.
Marketing should no longer be defined by Wanamaker’s rather hapless and helpless quote. Instead, management guru Peter F. Drucker’s words are now the ones worth repeating: “Business has only two functions: marketing and innovation.” I would add, “…and both of them will be led by the CMO.”
Russell Glass is cofounder and CEO of Bizo
