Web 2.0 is an industry buzzword. It is not just all hype however. I think that when it comes down to it, the term web 2.0 really does have meaning and your actions on the internet are apart of it. O’Reilly breaks it down best. They have a great breakdown of comparisons for 1.0 vs 2.0 – and anyone who has used these services and has a technical background will have an appreciation for the comparison. These simple services have transformed, to make it possible to target markets and segments very easily. It puts so much more information at the consumers fingertips, but also allows you to really get into their faces if you can harness the power of the new internet that is among us. Web 2.0 may not be defined in any dictionary, or be a real term at all. The bottom line is whatever you want to call it, the internet has evolved into a place where you can strategically market yourself, a service, or product and drop it on the lap of the consumer. Going about it the right way is the challenge, and keeping up with it may be even tougher. This is going to be the basis of a series of articles I post in order to educate people on how to use different services and applications to promote yourself or your business and products. How you act on the suggestions is up to you but these guidelines will at least help point you in the right direction and clear up some of the common questions and ideas. (source: SynergyShop)

Google had made a preparation to grab Internet Display Advertising from Yahoo, a lucrative market that had long been enjoyed and dominated by Yahoo!. Google’s chief executive, Eric E. Schmidt, has said repeatedly that display advertising offers one of the company’s best prospects for expansion, now that growth in its text ad business has slowed significantly. The new advertising exchange is a cornerstone of Google’s display strategy, and one of the main reasons Google bought the ad company DoubleClick last year for $3.1 billion.

Google executives say the new system, called the DoubleClick Ad Exchange, will greatly simplify the process of buying and selling display advertising, allowing many more publishers and advertisers to benefit from it.

Currently Google finds itself in the unfamiliar role of underdog. As one of the Web’s biggest publishers, and a seller of ads on a network of top sites like eBay and hundreds of newspapers, Yahoo is the king of the display advertising business. In 2007 Yahoo bought Right Media, a pioneering ad exchange whose business has grown steadily since, in part because many of the ads that run on Yahoo are brokered through it.

Still, analysts say Google’s push into the business could shake up the market. DoubleClick has had an ad exchange for some time. But the new system will automatically allow hundreds of thousands of advertisers and publishers who now use Google’s AdWords and AdSense systems to run their ads and ad space through the exchange.

“Marketers are going to be able to effectively reach 100 percent of the Internet audience and do so at a high frequency,” said William Morrison, an analyst with ThinkEquity Partners. “That is very difficult to do on the Internet right now, outside of a handful of major Web sites like Yahoo and a few others.”

Ad exchanges have been hailed as the future of the industry for some time, yet Mr. Morrison said that they only account for between 10 and 15 percent of the display advertising business. He said it was unlikely that the DoubleClick exchange would catch up with Yahoo’s exchange within the next year. But the Google exchange could become dominant over the long term, especially among premium brand marketers and publishers, he added. (source: NYT)

Microsoft’s new search engine Bing was holding to find a catchy jingle for the product. Today, they have announced the winner. “Catchy” is one word for it. Another is “awful.”

Sure, the song will get stuck in your head, but so does the sound of seals barking, or cows dying, if you listen to them for long enough.

But as bad as the jingle is, the video is much, much worse. It’s some guy in pajama pants doing really bad interpretive dance nonsense with awful effects and a Bing backdrop. The entire time I’m watching this, I’m thinking: So this is what hell looks/sounds like.

I cannot believe the guy won $500 for this. And I also cannot believe our interns didn’t enter.

Bing, as a product, is pretty solid. This jingle, is not. Hopefully whoever voted on it was just messing around with Microsoft.

“Enjoy” it below.

The success of online participatory media—video-sharing sites and corporate wikis alike—depends on the quality contributions of a small core of enthusiasts.

Jacques R. Bughin

Technologies that foster online collaboration and participation—for example, blogs that solicit customer feedback and wikis that allow employees to work together on documents—are gaining traction throughout the corporate world.¹ Few companies, however, have a clear understanding of what inspires users to contribute to such sites. Executives might start by looking to the world of online video sharing, another fast-growing test bed for participation. McKinsey research conducted in Germany finds that motives such as a desire for fame and a feeling of identification with a community encourage collaboration and participation. Such findings, we believe, offer insights into the way companies might tailor their Web 2.0 offerings.

To learn more about what motivates people to participate in collaborative technologies, we surveyed 573 users of four leading online video-sharing sites in Germany and then examined the blogs of one of the sites.² We observed that users cite a variety of reasons for posting content online—chief among them, a hunger for fame, the urge to have fun, and a desire to share experiences with friends (Exhibit 1). While some users were open to the idea of being compensated for their contributions, that wasn’t a primary driver: the people we studied weren’t paid for their contributions.³

We also found that a few users posted the most popular content. Depending on the site, just 3 to 6 percent of the membership added 75 percent of the videos available for download, and videos from just 2 percent of the member base accounted for more than half of all videos viewed. (As the “long-tail” effect would suggest, half of the videos posted accounted for only 10 percent of all downloads.) These figures resemble those reported in studies of other kinds of participatory media, including wikis, bulletin boards, and photo-sharing sites, where 5 to 10 percent of the users contribute half to all of the content (Exhibit 2).

Visitors under 25 years of age made up the bulk of the video-viewing audience we measured, but members in the 25- to 44-year-old age group contributed equally to postings—suggesting that working-age people would be open to participation in enterprise settings. A sense of sharing drives these older users, who tend to forward videos to friends even more frequently than do their younger peers. The presence of tools (such as most-viewed lists or forwarding features) that make it easy for users to see what’s popular or to send favorite videos to friends corresponded, by as much as 30 percent, with more downloads for popular videos.

These findings, consistent with our experience of participatory media in business settings, suggest that executives pursuing such projects should start by identifying and nurturing the small percentage of users who post quality content. At one cable company we studied, for example, more than half of the installers who contributed to an internal wiki said that social factors such as reputation building, team spirit, and community identification were the main factors motivating them to contribute. Only 20 percent cited the possibility of a financial bonus as their main driver.

To encourage well-connected employees to post ideas to the wiki, managers at the company examined its internal e-mail system to identify key staffers with wide social networks within it. They then encouraged these employees to post suggestions about improving the company’s processes. Identifying thought leaders and promoting their participation boosted the number of contributions and improved the quality of the postings. Other companies strive to make collaboration fun: at Google, for instance, employees place online bets on the likelihood that particular ideas will be adopted. Intuit uses a rotation program that invites selected staffers to contribute to the company’s internal online dialogues. Managers should also consider taking a page from video sites by tapping the power of tools that let users share relevant content easily. Likewise, companies should make sure that their employees can access collaborative tools with a minimum of bureaucratic hassle.

Companies will have to look beyond video-sharing sites for approaches to maximize the quality of the content. Those sites are concerned primarily with popularity, whereas corporate wikis and content sites (such as Wikipedia) gain momentum when new visitors discover and contribute high-quality content, which in turn makes the sites worthwhile for yet more newcomers. To improve the quality of internal wikis, then, companies might look to the quality assurance practices of open-source coding projects, which rely on appointed and self-appointed guardians to police quality issues. Companies should also create transparent and enforceable guidelines to prohibit unethical or illegal behavior, such as the posting of copyrighted material or proprietary secrets. They can learn from the examples of YouTube (which attempts to review content for obscenity before posting) or Wikipedia (which has committees that review entries for quality) and adopt similar review procedures for their corporate content.

Companies should prepare now for the day when Web 2.0 morphs into Web 3.0.

JULY 2009 • Donna L. Hoffman

It’s hardly news that the Internet has evolved into the primary vehicle for communication, information, and commerce. But in a surprising twist, today’s online customers—as both producers and consumers of their own content and services—ferociously guard their online experiences. This trend, which goes far beyond Web buzz, is catching some executives by surprise and making others more than a bit worried.

What does this development mean for your company? In effect, that its marketers are being replaced. As markets morph into Web 2.0 “conversations” and consumers gain much greater freedom to pursue their own interests, customers are doing things that online marketing managers don’t necessarily want—or expect—them to do. For example, they can easily connect with one another, often using multimedia sites such as YouTube and Flickr, so they themselves can satisfy their need for information about products. What’s more, consumers may trust information obtained in this way much more than they do information from your company. What will happen when these consumer experiences are much more interesting than anything your marketers have put up on the Web?

Executives can use a model we at the Sloan Center for Internet Retailing have developed called LEAD (listen, experiment, apply, develop) to create a road map that will help companies thrive in the online world’s environment of constant change.

Listen. Your organization should have a formal process to monitor and analyze what its customers are saying about it online and then use this information as an early-warning system. Even casual observation of these online conversations is better than nothing. Indeed, customers are probably already talking about you on sites such as Facebook or Kaboodle, whether or not you’ve set up pages there. They are also using microblogging platforms such as Twitter to broadcast their latest feelings about using your products and services. Some companies (such as Nielsen Online, with its BuzzMetrics services) specialize in analyzing this online chatter, though in-house efforts also can be very effective.

But simply entering the game is only a start. Companies should always assume that the digital environment will change rapidly—so they must adapt accordingly. Rather than pushing messages at consumers, marketers should listen to them and think constantly about ways to engage with them actively. A social Web presence that is tone-deaf to a customer’s needs augers rough times ahead: after one consumer products company, late last year, aired a Web video that some customers perceived as insensitive, many were so outraged that they pressed for a boycott of the brand. Worse still, its besieged managers didn’t bother to listen to the reaction after releasing the video—behavior that further incensed consumers. Social-media experts unanimously turned thumbs down on the company’s lackadaisical response, which led to widely publicized compilations of the tweets, blog posts, and YouTube video reactions; to mainstream media coverage of the debacle; and, finally, to what some considered an inadequate apology from the company. What’s particularly relevant is that most of these events unfolded over the course of a single weekend day.

Experiment. Don’t just monitor social media—engage your newly empowered customers by using the novel tools of Web 2.0 and beyond. Start with simple pilots: for example, create a company profile on social-networking sites, such as Ning, or sponsor a promotion on the innovative social-shopping site Polyvore. Make friends with bloggers and tweet your customers on Twitter. Kimberly-Clark, for instance, used its Huggies “Baby Countdown” widget to engage its customers on their computer desktops. Smirnoff used the viral-video marketing vehicle Tea Partay to promote its Raw Tea product. The campaign was a hit on YouTube.

While return-on-investment metrics for social media are still in the early stages, these experiments clearly pay off big time in greater customer awareness and brand engagement. Unless you have Web 2.0 experts on your team, stick with small experiments, since big ones can fail badly. For example, create a company-controlled community, perhaps through a blog, that gives your customers a place to offer feedback about your products and services—a basic move many companies still ignore. Also, take the first steps toward cocreation: engage your customers through collaborative efforts that conceive new offerings and ad campaigns, as Frito Lay did with its innovative customer-created ads campaigns “Crash the Super Bowl,” “Fight for the Flavor,” and “The Quest.” Remember, though, that there really aren’t any best practices or established business models yet. For now, companies just need to get some experience—and quickly.

Apply. Take the experiments and apply them. To make it easier to reach out to customers, optimize your Web site so that it connects fluidly with online communities and social-media sites. Make it simple for consumers to link to you and tag your content, and find ways to make your site more relevant in social-networking searches. If you have nothing worth linking to or tagging, or if your content isn’t relevant to consumers at all, you’re in trouble. Measuring impact is paramount, so you’ll need to use the Web’s predictive tools and quantitative analysis to track the results of your experiments. As you gain experience, you can apply what you learn on a larger scale.

Develop. The Internet is a social medium and should therefore be a crucial part of any company’s marketing mix. But it is critical to develop integrated marketing programs that use the Web as more than just another advertising channel. Companies must therefore rapidly flee from the mass-media broadcast mentality: for example, rather than simply buying ads on MySpace, they should make interactive Web 2.0 elements part of their marketing programs.

Consider the way GlaxoSmithKline handled the growing consumer confusion and concern surrounding the side effects of its mass-market over-the-counter weight-loss drug Alli. The company confronted the problem directly by setting up the My Alli community site, which includes active forums, videos, FAQs, a membership plan to aid weight loss, interactive diet tools, information on diet and support groups, cobranding, links to partners (eDiets for home meals, links to Alli retailers), and a sweepstakes tie-in to TV and print advertising campaigns. This approach allows the company to address consumers in a direct, nonthreatening way and to use basic Web 2.0 features that wrap these messages in a warm and supportive experience. When consumers search the Web for information about Alli, they see GlaxoSmithKline’s myalli.com within the first three organic search results, the better to counteract paid ads that are either scary (“diet-pill warnings”) or questionable (supposedly unbiased diet pill reviews on Britneys-blog.com), as well as links that emphasize the “icky” side effects. When consumers click through to myalli.com, they find a comprehensive site with straightforward, detailed product information, which helps the company mitigate the effects of information it can’t control. This site is a terrific example of how to integrate social media into a marketing campaign in an effective way

About the Author

David Court is a director in McKinsey’s Dallas office

About the Author

David Court is a director in McKinsey’s Dallas office

Many chief marketers still have narrowly defined roles that emphasize advertising, brand management, and market research. They will have to spread their wings.

August 2007 • David Court

Few senior-executive positions will be subject to as much change over the next few years as that of the chief marketing officer. Many CEOs and boards may think that their senior marketers’ hands are already full managing the rise of new media, the growing number of sales and service touch points, and the fragmentation of customer segments.¹ But as the forces of marketing proliferation gather strength, what’s actually required is a broadening of the CMO’s role. This expansion will encompass both a redefinition of the way the marketing function performs its critical tasks and the CMO’s assumption of a larger role as the “voice of the customer” across the company as it responds to significant changes in the marketplace.

Critical contributors to the broadening mission of marketers include the Internet and evolving distribution models, which are profoundly changing the way consumers research and buy products. In addition, third parties such as bloggers and the creators of user-generated media are having a greater influence on corporate reputations. Finally, marketers must help companies find and meet the unique needs of an ever more diverse and global customer base. Taken together, these forces are making companies transform not just the marketing function but also everything from corporate affairs and product development to distribution and manufacturing models.

Because changing customer needs and behavior underlie many of these shifts, CMOs are a natural choice to spearhead the response. Yet many of them find themselves limited by narrowly defined roles. Meanwhile, CEOs and board members, who have been pushing CMOs hard for growth and for more effective marketing efforts, are frustrated by the difficulty of finding chief marketers with the full range of necessary skills. Turnover rates for CMOs are therefore high relative to those of their C-level peers, and CMOs are in short supply. (Just ask any executive recruiter about the number of difficult CMO searches he or she has under way.)

To succeed in this new environment, companies must do two things. First, they need to clarify the broadened role of marketing in general and the CMO in particular. The accelerating pace of change is creating a wide range of potential new priorities for chief marketers—leading change efforts across the whole corporation, playing a more active role in shaping the company’s public profile, helping to manage complexity, and building new capabilities within (and even outside of) the marketing department. Second, as the roles of marketing and the chief marketer expand, it will become critical for CEOs to ensure that they have the right person as CMO, to understand fully how customers are changing, and to become more involved in developing new marketing capabilities across the company.

Winds of change

The biggest shift in today’s marketing world isn’t the much-discussed declining effectiveness of television advertising but the changes in how consumers research and buy products. The Internet is a major contributor to this shift. In categories as diverse as electronics, financial services, and health care, consumers increasingly ignore push marketing, preferring instead to use the Internet to research products and decide which ones to buy. Over half of all US electronics consumers, for example, now rely on Web-based research to narrow the choice of brands and largely ignore the advice of the sales staff when choosing among products in stores. In 2005 nearly half of customers who purchased insurance researched the subject online before talking to agents, and 80 percent expected to do so within five years. Currently, almost 60 percent of aging baby boomers use the Internet to supplement their doctors’ advice.

But the change in consumer buying habits is broader. The proliferation of distribution touch points and the more rapid growth of the low and high ends of the market at the expense of the middle are forcing marketers to take low-cost, time-saving, “facts-only” sales approaches and, at the same time, higher-value, more service-oriented approaches, often through alternative distribution channels. A white-goods manufacturer, for example, might need to provide different products, forms of sales support, and even subbrands for mass merchandisers, traditional department stores, and high-end retailers, respectively, to reach customers with different price sensitivities and definitions of value.

The result is a wide range of challenges. One vexing issue for marketers: many new media that seem to be promising ways of gaining access to consumers as they conduct their research are not yet at scale. The result is fragmented media spending and, sometimes, rising costs to generate the desired consumer impact. A broader issue is that marketers must work more intensively than they have in the past with colleagues in other functions to develop, deliver, and communicate value propositions to consumers who want independent advice and frequently aren’t willing to pay for higher-touch sales and service. Consider, for example, the white-goods manufacturer mentioned above. Changing customer needs (which marketers understand) create an opportunity to boost sales, but manufacturing, marketing, and sales must cooperate if the company is actually to win big among all three types of retailers.

Shifting patterns of buying behavior coincide with another seismic change: the increased role of third parties in corporate-marketing and reputation-building efforts. While third parties (such as Consumers Union, the publisher of Consumer Reports magazine) have been around for years, the Internet’s growth has tremendously increased the importance of user-generated media (for instance, blogs, independent sites such as Wikipedia, and YouTube and other video-sharing sites). User-generated media account for almost one-third of all the time individuals spend on the 100 most visited US Web sites, up from roughly 3 percent just two years ago. Consumers skeptical of push ads are flocking to a medium they trust more.

Although good for consumers, this explosion of user-generated content comes with big risks for business. Individuals and nongovernmental organizations that don’t fully understand the products of a company, and may be purposefully trying to harm it, can sometimes have as much (if not more) influence over its image as its marketing communications unit. User-generated media, while a long-term marketing opportunity, are thus proving to be a short-term PR nightmare for many companies. Who, for example, can forget the YouTube video clip featuring a cable TV technician sleeping on a couch?

As if these changes weren’t difficult enough, the underlying customer needs that companies must understand and meet while they pursue growth in new (and often less-developed) markets are changing as well. Emerging markets are grabbing a larger share of global GDP, and the developed economies’ middle market (which many marketers have historically targeted) is stagnating.² Growth-hungry marketers must therefore learn how to understand and capitalize on the needs of new markets, segments, and consumers, including people with incomes much lower than those that most marketers were accustomed to in the past.

The CMO’s changing role

As companies confront changing consumer behavior, increasingly important third-party scrutiny, and more diverse target markets and segments, they must broaden the roles of marketing and the CMO. Today, many chief marketers focus mainly on building brands, making advertising more effective, and perhaps market research. Although these responsibilities aren’t going away, CMOs must address several other areas as well: leading company-wide change in response to evolving buying patterns, stepping up efforts to shape a company’s public profile, managing complexity, and building new marketing capabilities throughout the company as a whole. The relative importance of these new priorities will of course vary by company and industry, but the broad importance of reinventing the CMO’s role as a strategic activist is similar across them.

Changing to reflect new consumer buying behavior

Consumers knowledgeable about and comfortable with online research and sales will make many companies change their business models. Pharmaceutical companies, for example, must rethink the way the field force calls on physicians, who are becoming a less important influence on the consumer’s health care choices. Retailers need to design stores that integrate the Internet’s broader selection with the brick-and-mortar approach (as some are now doing with in-store kiosks). In general, there’s a need for tighter integration between corporate marketing and sales as Web-based channels expand their role in advertising, sales, and marketing.

The resulting business changes will extend far beyond traditional marketing: a company won’t succeed without heeding the voice of customers and their evolving habits in buying goods and services and in interacting with companies and brands. The CMO is a natural candidate to help lead the company as a whole toward business changes that reflect evolving customer needs. It is, for example, the marketing department that is likely to develop (as Toyota Motor has done) programs to position a company in online communities such as Second Life, the leading virtual marketplace, which provides low-cost opportunities to learn how role-playing consumers would design and use new products.

This tight relationship between marketing and critical business changes extends to emerging markets, whose growing importance will place exacting demands on the entire organization to develop, produce, and deliver lower-cost goods and services. A deep understanding of the needs of consumers in these markets and the trade-offs they make will be critical in designing products and retail formats that strike the right balance between price and quality. Since engineers and store design teams in developed markets probably won’t have the needed insight, CMOs will have to develop partners and capabilities to tap into high-quality local sources of customer information. Nokia’s development of low-cost mobile phones for India and P&G’s success with toothpaste in China show how companies can translate insights about local consumers into growth in emerging markets.

Shaping the company’s public profile

The increasing importance of third parties will force businesses to enhance their awareness of blogs, chat rooms, and other social-networking media and to develop new strategies both to capitalize on marketing opportunities revealed by consumers and to defend themselves from attacks. Many companies will find that their initial efforts will be defensive ones involving changes to the tried-and-true approach for managing their public profile.

Traditionally, companies have tended to separate marketing (focused on customers) from corporate affairs (addressing government officials), investor relations (catering to financial analysts), and public relations (targeting the press). Often these groups report to different executives—marketing to the CMO, investor relations to the CFO, and corporate affairs (and perhaps also public relations) to a corporate secretary. But consider the following scenario: a nongovernmental organization erroneously complains on its blog that a company is illegally using below-minimum-wage labor to make critically important products. Within days, major media and Internet sites have questioned the truthfulness of the company and the quality of its products, government officials have expressed concern, and its stock has tanked. Who responds? What in the past might have been a PR issue now requires an integrated response across marketing, PR, investor relations, and public affairs.

Over the past few years, McKinsey has been involved firsthand with several large organizations trying to shift their public image. In our experience, classic marketing techniques (such as segmentation and understanding the sources of consumers’ opinions) are the foundation of a corporate-image strategy. Public-relations and lobbying campaigns may be the necessary tactics, but any strategy should be based on classic consumer research. Most corporate-affairs executives don’t have the background to lead this type of effort and therefore increasingly turn to their marketing counterparts for assistance. CMOs are the natural coordinators of an integrated effort because they understand customers and sophisticated marketing techniques.

Managing complexity

With more countries, more customer segments, more media, and more distribution channels, companies and their CMOs are waging a battle with complexity. Consider prices: to set them effectively, consumer companies operating in a number of channels and geographies must address the needs of dozens of segments and make rapid, analytically informed decisions about as many as 20 million individual price points a year. Many companies are developing new approaches to manage this complexity. Most choose to give final pricing authority to the managers accountable for the performance of a brand or geography, supporting them with centrally established processes and policies to ensure consistency across segments and geographies. Small analytic groups often are crucial to ensure the collection and analysis of the pricing data needed to make good decisions.

One key challenge is reconciling local entrepreneurship with global and cross-segment brand consistency. While the ultimate pricing decisions typically (and appropriately) remain with the business units accountable for profits, some CMOs are beginning to play a critical role in developing data-management tools and processes that help companies to maintain a consistent brand image and to support it despite growing complexity. One such company is a multibrand automotive-battery manufacturer that sells its products through a number of retail channels, including national and regional auto parts retailers, discount mass merchandisers, and warehouse clubs. Its CMO used the real-time reporting of average and lowest net retailer prices by region, channel, and even specific sales outlets to maintain the right price differentials among them. This CMO regularly interceded in pricing and at times even chose to optimize it within a specific region in order to maintain critical price relationships among the various channels, brands, and regions.

Building new marketing capabilities

The changing environment calls for new marketing capabilities, both in the marketing organization and in the company as a whole. Within marketing, for example, the ability to build brands across an increasing number of media, including vehicles dominated by user-generated content, will be critical. Many companies will have to manage an increased number of advertising and PR agencies and to build new skills for creating integrated messages. There also will be analytic muscles to build, such as the data-management skills needed to compare and maximize the effectiveness of on- and offline marketing expenditures.

Many of these skills, such as expertise in the business use of social networking, in digital marketing, or in emerging markets, require a degree of specialization that complements the generalist capabilities of traditional marketing managers. As a result, many companies will be forced to restructure their marketing and sales organizations by creating centers of excellence for key marketing capabilities and, perhaps, by outsourcing marketing activities requiring specialized skills, just as some CIOs rely on external IT-development resources. Not surprisingly, almost 75 percent of the chief marketers polled at a recent CMO summit (organized by the Marketing Science Institute and McKinsey) agreed that the skills they needed were becoming so specialized that their organizations would have to operate quite differently in the future.

The skill-building challenges of CMOs probably won’t stop in their own departments—the far-reaching customer-centric changes taking place today are too important. As we move toward a world where 80 percent of life insurance purchasers research the subject online, for example, sales agents seeking to understand their customers must learn to ask them new questions: Have they researched online? What sites did they visit? What impressions of different brands do they have? Public-relations and even general managers need to understand which third parties influence their customers most and what responses work if ill-informed discussions start there. The CMO and the marketing organization have the best position to provide market research and training and to help with the creation of appropriate responses and the required capabilities. It’s not surprising, therefore, that some companies are asking their CMOs to establish “commercial councils” across business units to coordinate their marketing and customer efforts.

How CEOs can help

CMOs are indispensable for meeting tomorrow’s customer and marketing challenges. But CEOs too must take an active role, not just because those challenges are large, but also because close involvement will help them know if their CMOs have the right mix of skills. Today, though, many CEOs spend little time on marketing challenges and treat them as “just for the CMO.” One reason: the percentage of CEOs with marketing backgrounds has declined in favor of people from operations or finance. Here are three straightforward ideas for CEOs seeking to help their CMOs and ensure that their companies thrive:

• Take time to understand what’s really happening with customers. Many of today’s marketing reviews focus on the brand image and financial results. Instead, find out how the needs of different customer segments are evolving, who is saying what to your customers on which blog, who are the social influencers of your product, and how customers are changing their approach to decision making. On these issues, advances in technology allow companies to obtain a level of insight that is staggering compared with what was possible just three years ago. CEOs can add a lot to such a customer-oriented discussion, but only if they take the time to participate. Gary Loveman, the CEO of the casino operator Harrah’s, for example, has been deeply involved in his company’s efforts (involving sophisticated customer relationship management techniques) to boost the loyalty of its customers.⁶
• Foster the right connection between the CMO’s efforts and those of the other parts of the organization. This connection is not only critical for bringing together marketing, PR, and corporate affairs but also important when CMOs are asked to lead major corporate initiatives on strategy and business models. Without the right bridges between the CMO and the heads of business units, the latter tend to view such projects as corporate-staff efforts and therefore delegate participation in them to lower-ranking employees. Ensuring an effective rotation of senior marketers into line roles (and having future general managers spend time in marketing ones) can help break down barriers and infuse a marketing orientation into the entire company. Two of the four senior marketers in the accompanying roundtable, for instance, recently shifted from roles leading marketing and sales to positions with broader responsibilities (John Fleming as Wal-Mart’s chief merchandising officer and Alex Myers as head of Carlsberg’s business in Western Europe).
• Be a “thought partner” for the CMO as he or she transforms the marketing organization. A lot of change—skill building, the development of specialists, and geographic decentralization—will be required to create the marketing organization of the future. Even a CEO who lacks a marketing background typically has more experience with this type of organizational-development effort than the CMO does—and can be an extremely valuable counselor.

No relief is in sight for companies wrestling with the forces of proliferation. In the years ahead, an accelerating pace of change will continue to transform the role of marketing and the CMO and their relationship with the corporation as a whole.

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