Did you know that 78% of new CMO’s undertake an agency review within four months of their start date? With the release of our latest report, The CMO Lifecycle: Tenure Analysis and New Business Opportunities, our team tracked CMO’s of national advertisers since 1995 and found that CMO changes are the #1 indicator of new business opportunities for agencies.
Winmo CEO Dave Currie joined leading agency search consultant, Lisa Colantuono for an Adweek Webinar where they discussed how you can activate CMO tenure data to forecast CMO shifts and capitalize on narrow windows of opportunity to win new business.
In case you missed it, here are five key industry takeaways from the webinar as well as the answers to the Q&A session after the event:
1) Consumer Packaged Goods
This category serves as one of the largest throughout the report, and also one of the highest rates of CMO churn at a tenure average of 37 months. This industry is better for identifying new business opportunities.
A few trends exist throughout the space, the most prevalent being an influx of startups that consumers consider to be more authentic and therefore healthier. These startups are outshining major companies and slowly but surely stealing their shelf space as well. For instance, RX Bars and Pacific Foods Organic Soup are just some of the new startups found in this category that have not only gain a ton of traction.
Another shift is the wave of giants buying upstarts.
[easy-tweet tweet=”An @iriworldwide (Information Resources, Incorporated) study released in October 2018 found that more than $17 billion in U.S. CPG industry sales have shifted from large players to small ones since 2013.” via=”no” template=”dark”]
In order for agencies to win pitches in this category, they must understand we are living in the age of precision consumer goods. Consumers expect products that are created just for them. Therefore, agencies must keep in mind innovative business solutions are crucial for CMOs, as well as creative breakthrough work. The more an agency knows about the consumer, the more success they will find in the space. Along with that, the more insights agencies know about the buyer journey, the more invaluable you will be to CMOs in this space.
With 403 companies being tracked in the report, retail is the second largest category. The CMO churn is also one of the highest, reported at 36 months.
This changing landscape throughout retail is a big challenge. New channels of trade, a change in eating habits, and younger consumers with different shopping styles are creating shifts throughout the space.
Lisa Colantuono reported, “I’m often asked about who are the “hot agencies” in the industry and my answer is always the same.
[easy-tweet tweet=”Hot agencies are good at what they do because they excel at something that no one else can emulate. So instead of trying to “copy” something, figure out what you offer that no one else can.” user=”@AARLisa” hashtags=”#CMOTenure” template=”dark”]
Stand-out agencies are those that have a full understanding of omnichannel marketing and assist retailers in balancing attracting the new digital shoppers while retaining their loyal shoppers in the physical store.
Agencies in this sector must be capable of producing quick, snackable content. Understanding the younger millennial shopper mindset and communicating with them effectively through technology is crucial for today’s retailers. Agencies that have real-time analytics that can be effectively applied and implanted will win the business in this space.
3) Financial Services
This established category has faced rapid transformation recently. The average industry tenure of the 265 companies researched is reported at 48 months, with insurance vertical and traditional banking being less probable to change. This industry is the most tenured and therefore less probable to change.
CMO challenges throughout this category include reducing CPA, increasing brand awareness, improving the onsite experience, and they are dealing with a massive amount of information/research each day. The financial industry is where agencies must know the rules and regulations along with truly understanding the banking business and associated needs.
[easy-tweet tweet=”There’s very little time for learning curves and no room for error or lack of core business understanding in the financial services industry.” user=”@AARLisa” hashtags=”#CMMOTenure” template=”dark”]
Agencies in this sector should place a strong focus on building and maintaining relationships by constantly offering insights to people in the sector. Sharing thought leadership, consumer insights, and new learnings about brands they’re truly interested in helping is the key for agencies. Secondly, having a powerful sales intelligence tool such as Winmo will keep agencies alerted on agency shifts on the horizon and one step ahead of competitors.
A less regulated vertical, casual dining has the lowest CMO average tenure of this category with 230 companies tracked overall with average tenure being 37 months. This category is no stranger to change and one that’s at the top of the pack of impact by generation waves, dietary fads, and fickle consumer trends.
CMOs entering this market typically come from the same category, with their main mission being penetrating new markets and increasing market share very quickly. CMOs strive to balance short-term sales while developing long-term branding needs, which typically consists of a “test and learn” market growth model. Another major pain point in the industry is understanding what’s important in the restaurant business, which isn’t always about marketing needs, but operational needs as well.
Agencies should be comfortable with the “test and learn” model and look at the bigger picture when it comes to solving problems for the CMOs- it could be as simple as having clean bathrooms in each franchise.
5) Digital Business Providers
The last and most dynamic and change-driven sector has the highest volume of CMO church, therefore resulting in the highest sector of agency relationship churn also is Digital Business Providers. Subscription Delivery Services churns most marketers and has the highest number of project agency relationships as well.
This sector operates under a strong sense of urgency, and two vital needs from an agency include data management and an integrated content strategy. It’s also crucial to speak the jargon of who you are working with and make sure tone and language is appropriate.
CMOs within this sector are on the hunt for creative solutions with efficient production chops. The key for agencies is to discover how creativity with the right technology drives the business metric. Finding simple and pure ideas that are different and bold at the same time is the route to success for agencies in this sector.
Dive deeper into our latest CMO tenure insights. Download the full report here: The CMO Lifecycle: Tenure Analysis and New Business Opportunities.
We’ve also included quick takeaways on six steps to win new clients:
After the webinar, we opened up the panel for questions and had some pretty insightful inquiries ranging from how to best reach decision makers to what is actually driving CMO turnover. Here are 10 of the Q&As from the webinar:
1) Q: Are marketers open to speaking with boutique/small agencies or are the majority of assignments going to the larger, holding company agencies?
A: Answered by Lisa Colantuono: Marketers are definitely open to small and boutique agencies depending on the project and on the expertise/talents offered by the agency. Marketers don’t want to be a small fish in a big pond but they also don’t want to be the largest fish in a small pond.
2) Q: How many unsolicited emails to marketers receive from agencies and what makes them open an email?
A: Answered by Lisa Colantuono: On average over 1000 unsolicited emails per month; Timing and relevant information about the category, consumer or brand are vital.
3) Q: How do most CMO’s view PR when reporting to the board?
A: Answered by Dave Currie: In my experience, as PR has expanded as a discipline encompassing more marcom activities, with it has followed additional KPI’s with greater levels of measurement that can be more directly tied to business / financial impact. This speaks to one of the key insights shared about helping the CMO communicate true business impact from their efforts.
4) Q: Any tips for an indie agency that is up and coming after building the foundation for nearly 10 years.
A: Answered by Dave Currie: Bring back the fire that you had as a start-up in your first few years if that flame has at all faded. Fight for the right attention from just a few that will dramatically change the reputation and scale of work you’re undertaking. Prioritize time daily to get into the circle of those few and help them in any way you can a few times before you ask for anything in return.
5) Q: Any strategies to stay AOR or a core agency partner after the CMO has left?
A: Answered by Lisa Colantuono: Call a review with the new person in position! Show them what you’ve done, the value you’ve added and future plans for the brand.
6) Q: What’s driving CMO turnover? What are CMOs looking to do to stay in their roles?
A: Answered by Lisa Colantuono: Too many reasons to list – poor brand results, lagging sales, changes in the team, better opportunity elsewhere
7) Q: What is the best way to reach out to these decision makers? Is it through customized emails, phone calls, attending events? Which avenue has the best success?
A: Answered by Lisa Colantuono: I wish I had a nickel for every time I’ve been asked this question! There is no one best solution. It’s an integrated marketing solution that works best. It’s reach and frequency that helps. It’s about building a relationship which takes time by authentically sharing information to HELP THEM with their needs.
8) Q: What are some of the more creative ways you’ve heard of agencies using to reach out to CMO’s just to get their attention?
A: Answered by Lisa Colantuono: That’s just it – you don’t want to just “get their attention!” You want to build a relationship step by step by consistently offering thought leadership. New business isn’t a sprint. It’s a marathon.
9) Q: Are there any specific techniques that agencies are doing to get “noticed” or meetings with new CMOs?
A: Answered by Lisa Colantuono: Sharing insights and POV on new technology; Insights and POV on consumer habits; Insights on where the brand sits in the competitive set and relevant experience on how to elevate the brand in the set.
10) Q: Is a CMO change the #1 reason why a marketer puts their account in review? If not, what is the #1 reason?
A: Answered by Lisa Colantuono: There is no number one reason. Every brand is different. People work with people so when people change on either side (agency or client) there tends to be a change. But there are many reasons for reviews with a big reason being COMPLACENCY! When agencies become complacent, clients tend to feel indifferent with their “vendor” and you don’t want to be in that position.
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