Marketing not broad enough

When the German tyre and auto giant Continental acquired Kmart Tyre & Auto from Wesfarmers for $350m five years ago, the business wanted a c-suite role that would force a customer-first culture across the company. Marketing, although often cited as the customer champion, wasn’t broad enough operationally, nor did it have form in holding revenue accountability for the entire business.

So Continental’s Australian team opted for a Chief Customer Officer and installed the former CFO at Kmart Tyre & Auto, Adele Coswello, in the role. Marketing, which she says has been among the most challenging to unpack of all her reporting lines, has proven critical in driving growth for the business after a rebrand to Mycar. But her remit extends across every customer touchpoint to ensure a consistent customer experience - merchandise, Mycar’s online presence, retail operations, a developing mobile service business, customer care, an outsourced customer contact centre, tech stacks and new business and product development all sit under Coswello’s roving brief. 

CCO logic

“The logic behind the CCO appointment at Mycar was driven by us recognising that if we're going to market and we're telling the market that we put people first, then we needed representation at the C-suite table that's obsessed by the customer,” says Costello. “I have a head of marketing who’s very patient with me and we've probably done some marketing 101 but once you learn the funnel, it's all easy from there. And if you've got some money to spend, it's even better.”

Costello’s career in finance, like the career-long sales background of Inghams CCO Mark Powell, will horrify more than a few marketers who are often in battle with these two corporate peers proving the case for marketing budgets and business contribution. 

But Coswello says she had marketing in her remit previously as the finance boss at Kmart Tyre & Auto – the conversations then were more clinical around ROI and top line sales impact but says she quickly got the real importance of marketing when building a new brand and business from scratch at Mycar.   

“The beauty in marketing, when you have a promo out, you're on TV, you're on radio, your search is going well, you're hitting the search keywords; once that is all working, then absolutely, you start to see brand increase, more customers hitting us in every channel possible.”

But that’s not enough for a company striving to ensure its marketing claims land for customers and the experience they have across and through the organisation – ultimately to deliver business growth.

Classic marketer conversion

Hipages CCO Stuart Tucker is the only “classic marketer” in this CCO line-up but in previous roles, including Commbank and Aussie Home Loans, he had responsibility for business development, customer service and product before joining the tradie marketplace six years ago. “It wasn’t too hard to segue into the Chief Customer role”, he says. And like Costello, marketing is in his reporting lines but it goes well beyond. When Hipages acquires a new plumber, sparkie or chippie on a subscription to Hipages, they might interact with seven or eight different Hipages teams. Someone has to pull all that together.  

“My remit includes marketing, sales, service, and also partnerships. So I have a senior leader in each of those teams running those functions and my role is to bring that together. It's a recognition that, particularly in digital businesses like ours, customers seamlessly flow between channels. And if you use an example of us acquiring, activating and onboarding a new tradie customer, they might touch seven or eight different parts of my team from brand to PR to tradie acquisition, new business sales, onboarding, in app, via marketing comms," he said.

"Then they would be handed over to our tradie success team for an onboarding call, our service team if they got queries, and then we worked with them over time. So that's a good example of way different parts of my team can come together for a better customer experience.”   

CMO v CCO

But the argument historically from marketing is that it's been the champion of the customer. How does Tucker delineate between what a CMO does and what a CCO does when they’re both supposedly about the customer? 

“I guess it’s that customers are touching different parts of the business and in some days, multiple parts of the business on any one day. So marketing plays a role in that. But the CCO role recognises that different elements impact the customer experience. And it's not only owned by marketing. In fact, you know, in great organisations, everyone feels like they own the customer in some way or another. But really, it's my role to make sure that it's all coming together for better outcomes. I've got to make sure that I just don't get pulled into just focusing on marketing. I have a large sales team, and also customer service split between Sydney and Manila.  It's my responsibility to leave the marketing to Nick Ellery, VP of marketingnbut then how do I stitch that together with the other senior leaders in the parts of my team to drive revenue and also drive better customer outcomes.”

Marketers horrified

For Inghams CCO, Mark Powell, it’s a different story altogether. A veteran blue chip sales chief with the likes of brewing giant Lion and Coca-Cola Amatil, Powell was appointed to the CCO role at Inghams which primarily meant focussing on large clients like KFC, McDonald’s and Woolies. About 10 per cent of Ingham’s billion dollar listed business is Inghams branded for consumer lines. Three months ago marketing was brought under his remit and he acknowledges the potential horror amongst his former marketing peers - although he talks marketing lingo like developing a brand architecture, building brand equity that might even frighten his sales alumni.

“It's true - marketers out there will be horrified, he says. “I've spent my whole career telling them how to do their job and now I have to do it. I think they’ll be watching very keenly to see how it all goes.” Powell admits he’s had more than a few street fights with marketing teams in his day over strategic product and brand priorities.

Sales v marketing streetfights 

“I’ve had many, many, many over the years…often the ones where we've had to kill brands that are just going absolutely nowhere and try to convince someone that's created a brand that it’s just not resonating with absolutely anyone. A great test we always used to do in the beer business was when we do a launch of a new product and we'd have all of the the 400 sales people or whatever it was come in for the big launch. If you looked around the room and it was all half empty bottles, you knew it was going to be a shit product.”

Revenue responsibility

Although their career backgrounds vary wildly, the single thread that these three CCOs have in common is revenue accountability for the business – that is rarely territory CMOs play in. 

“I'm definitely on the hook for revenue,” says Tucker. “There's no question about that. Every member of the senior leadership team is targeted on revenue and EBITDA. But because I have the sales team, which really drives revenue through from acquisition to customer development to growth and retention, then it's on me. There's other elements to the overall customer experience that other members of the team bring input, like our customer experience through to our product offering but the bottomline sales is where the accountability starts and stops.” 

Marketers guilty

Tucker says sometimes marketers are “very guilty” of being removed from the customer. “I sit amongst the sales and service team every day. It's like sitting in Town Hall station when it's buzzing, it's noisy and I love it. But I'm also hearing them interact with customers all day every day, which is great for someone in my role. And I think more marketers need to be closer to the customer in that regard. I love our sales guys - they're the hardest working, most down to earth team of people I've ever worked with. It's brilliant.”

Says Mycar’s Costello on revenue responsibility: “Absolutely revenue, EBIT are our targets. But in retail it's also a little different, because merchandise plays a large role in revenue generation.”

Ingham’s Powell has all that with a twist of having to “shape demand” based on a product that is so low margin, every part of the chicken has to be sold in some form or another.

“It's a really interesting one, too, especially in this business, which is basically an agricultural business,” he says. “We want to meet demand that's out there but we also have to shape the demand to meet what we can supply. So it is a little bit unique because you're actually trying to create some demand yourself that suits what you can do from a primary production point of view.

Balancing the bird

“We have each unique thing called the balancing of the bird - it's humbling because for a manufacturing business, it’s quite unusual. But you start with something whole and you break it apart, and then you put it back together to go and sell it. So it's the opposite normal manufacturing. you just can't afford a low margin business. You can't afford in a low margin business to have any sort of waste. . So there's a lot of lot work put into balancing the bird.”

Revenues good but different

With revenue responsibility, these three CCO’s have a firm fix on what’s happening in consumption shifts across the economy at present – and all, interestingly, are benefiting in different ways to the tightening in consumer spend. Powell is seeing the early signals of consumer demand shifts in food as Inghams volumes for quick service restaurants like KFC and McDonald’s is “coming off  a bit” but being offset by an uptick in supermarket sales. 

For Tucker,  tradies are seeing work slowing so more are signing up to land jobs on Hipages - with a shift on the consumer side of the marketplace from “bigger renos” to smaller home jobs. And Costello’s Mycar is on a roll too: more cars post-covid are on the road but the new car purchase cycle is extending and car owners are opting for cheaper service option outside dealerships.”

If the successful experience of these three companies appointing a Chief Customer Officer holds, and their peers at Coles and IAG do the same, the return of the CCO, after a decade of mixed signals, is set.