Eight Steps For CMOs In A Recession

While reading a post by Harvard Business School professor John Quelch called How CMOs Should Function in a Recession, I realized that my previous advice to new CMOs was extremely relevant to all CMOs in this economic environment. So here are the 8 steps I had outlined for new CMOs with some commentary about how to think about each one in a recession:

  1. Re-establish our brand. As companies eliminate some activities to match their slowing revenues, its very possible for those cut backs to cripple their brand. CMO’s need to make sure that their organization’s core brand promise is well defined and understood, and that it plays a prominent role in how the executive team makes trade-offs.
  2. Put our agency work out to bid. Just about all agencies are hurting in this environment, and would rather have low margin work than no work at all. Given the need to cut back, CMO’s should consider renegotiating all of their agency deals. It’s a great environment for dialogues about doing more with less.
  3. Refine our target segments. In this economic environment, firms need to become even more selective about the customers they are targeting; otherwise they’ll poorly serve everyone. CMOs need to proactively define the key segments and refine the company’s value propositions for each one. 
  4. Increase investment in customer insight. It may be hard to argue for more investment anywhere in this environment, but getting a better understanding of target customers is extremely important; especially as customer needs are shifting. CMOs should make sure that their companies maintain a strong understanding of customers. 
  5. Build-up employee brand advocates. Many companies are reducing their workforce, but the success of the company is based on the remaining employees. So it’s more important than ever to engage employees in the strategy and objectives of the brand; difficult times can create the opportunity for open communications.
  6. Prioritize digital channels. Without any money to waste, firms need to focus on the most cost-effective opportunities like digital channels. CMOs need to take full advantage of their online marketing opportunities. Having said that, there might also be some bargains available in non-digital media as well.
  7. Improve usability of everything. This is more true now than ever. Poor usability is like a veneer that turns valuable assets into worthless annoyances. For a fairly modest investment, companies can improve critical experiences form online purchases to mailed statements. CMOs need to push for usability improvements that can capture value from existing interaction platforms.
  8. Get people asking three questions. This advice remains universal. CMO’s should continue to shift people’s thinking from inside-out to outside-in. How? By getting people to regularly ask the 3 questions of a concept called “Scenario Design:” Who are your target users? What are their goals? How can we help them achieve those goals?

The bottom line: CMOs should treat this time like they’re in a new job.

About Bruce Temkin, CCXP
I'm an experience (XM) management catalyst; helping organizations improve results by engaging the hearts and minds of their employees, customers, and partners. I enjoy researching and speaking about these topics. I lead the Qualtrics XM Institute, which is the world's best job. We're igniting a global community of XM Professionals who are inspired and empowered to radically improve the human experience. To achieve this goal, my team focuses on thought leadership, training, and community building. My work is driven by a set of fundamental beliefs: 1) Everything starts and ends with human beings, so you need to understand how people think, feel, and behave; 2) XM is a discipline that needs to be woven throughout an organization's entire operating fabric; and 3) Building the XM discipline requires a combination of culture, competency, and technology.

3 Responses to Eight Steps For CMOs In A Recession

  1. Adam Dorrell says:

    Bruce, good ideas, thanks for sharing. I’m a real sucker for these “top things to do lists”!

    Suggestion for a number Nine: *Re-examine channel relationships*. Now is the time to consider which channel partners are helping the brand (see your point 1) and which are hindering it (discounting, dumping, using as a loss leader etc). Many consumer electronics companies have found that the power retailers have had the upper hand for many years – and now using the recession as an opportunity to a) do some tidying up of channel terms conditions, plus exiting a few poor performers (and some risky ones too).

    This also plays into your point 6 – CMOs should really power ahead with Direct To Consumer sales initiatives using digital channels. Good for brand management, customer contact/feedback, Net Promoter Score, and ultimately sales/profit.

    I modestly also suggest adding my “Four Recession Busting Bullets for eCommerce” on http://customergauge.com/wordpress/?p=307

  2. Great post Bruce. I’d like to add that your 8th point is right now the most critical one. We’re in the trough of the recession and it’s time for to start thinking about the economic rebound. And the 8th step is the first step toward developing the right winning marketing strategy for the ‘new world order’ – before the rebound takes hold.

    I’d like to add my 5 step rebound planning to your 8th step:
    1. Listen closely to these bell-weather customers for early warning indicators, but also to understand how the market landscape is changing.

    2. Develop a chessboard and plot each competitor’s moves based upon different past economic situations and corresponding industry/market factors. These trends will give you a good indication of the range of actions they are considering in today’s economy.

    3. Recessions are excellent opportunities to accomplish the unexpected and pursue new strategies that can change the playing field in the next growth economy. The objective is to identify what will drive the next growth wave.

    4. Changes in market dynamics, company resources, and industry drivers require a realignment of product portfolios. The result should be a clear action plan that identifies which products to retire, sell, repackage, reposition, or invest in for further innovation.

    5. Rebound Triggers define the market and economic events that serve to “trigger” specific parts of the market plan as the economy slowly begins its turnaround.

  3. Bruce Temkin says:

    Adam/Christine: Thanks for your comments! You’ve added some great advice to CMOs.

    I like the idea of rethinking channel partners. Now’s a great time to reassess your business, not just for cost-cutting, but for long-term objectives. Cut back on your ineffective partners and double-down on the good ones!

    And everyone should read Christine’s 5 items!

    Both of you have added some great content and

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: