UPS’s removal of CMO role reveals real issues facing executives

There is a growing conversation in the industry about the role of marketing in the C-suite, especially following the recent departure of UPS’ chief marketing officer. As CMO tenures continue to shrink, UPS’s exit is particularly noteworthy. That’s because the package delivery company has decided not only to part ways with its CMO, but to eliminate the CMO role entirely. Marketing will now be overseen by a newly promoted Chief Commercial and Strategy Officer, who will be responsible for revenue, product management, strategy and transformation.

The eradication of the CMO role at a Fortune 100 company like UPS is perhaps the most pointed attack ever seen on the marketing function. Research has linked this downward movement to a lack of CEO trust and confidence in the CMO’s leadership. Anecdotally, this contempt is tied to a lack of knowledge about what marketing does. But perhaps the root of the problem lies in executives’ misunderstanding of what marketing actually is. If we had a better framework to describe marketing and a shared vocabulary to discuss its contribution to the business, why would we dare to consider reducing its role within the senior leadership team?

Traditionally, marketing has been viewed as an organizational function responsible for creating, communicating, and delivering value to customers and managing relationships with customers in ways that benefit the organization. While marketing is certainly made up of these elements, this expression does not adequately define what marketing is or what it should do. For lack of a better language, marketing ends up serving as a shortcut for advertising campaigns, product positioning, partnerships, brand awareness, and other activities. But of what use?

This anemia makes marketing susceptible to skepticism within the C-suite because it is less specific than finance, which is the CFO’s responsibility, or operations, which is the COO’s responsibility. Suffice it to say that, for want of a better word, the origins of marketing are a fruitful starting point.

According to the Oxford Dictionary in 1455, marketing is “to sell or market,” or as my closest thought partner, University of Michigan professor John Branch, puts it: is said to be an act of marketing. Through this lens, marketers approach advertising campaigns, product positioning, partnerships, brand awareness, and more as means of reaching the market—and the people within it. That’s the difference between a gardener and a farmer. Gardeners grow crops but never put them on the market. One is a hobby and the other is for profit. Marketing goes to market and the CMO leads this practice.

And why do we go to the market? If you’re marketing a company that sells widgets, you’ll probably go to the marketplace to exchange your widgets for money. But what if you’re a political candidate running for mayor? Go to the market to get votes. Let’s say you want to promote your new podcast. What is the purpose of your marketing efforts? Your motivation is to get visitors and get them to click on your content.

This way of thinking provides a very clear path to understanding marketing. As marketers, we go to the marketplace to influence behavior. Everything we do as marketers responds to this obligation to buy this, not buy this. Go here, not there. Drink this, not that. Vote for her, not him. Be part of this, not that. Use this technology instead of other technologies. As marketers, we’re in the business of introducing behavior. This is the destination for all marketing efforts, and campaign strategy (advertising, communications, sponsorship, etc.), performance optimization, and brand initiatives are all different routes to getting there, and marketing leadership is responsible for

Without marketing, people won’t move. They don’t buy, they don’t vote, they don’t click. Despite this fact, marketing is often viewed as a cost center rather than a true profit center. In fact, marketing is the sole profit center of a company. Research and development is a cost center. Companies cannot profit from research and development until they bring the product to market. This also applies to manufacturing and human resources departments. The company won’t make money on these features until they’re on the market and people are moving. What CEO wouldn’t want this function overseen by a senior leader who actually understands it and knows how to drive people?

This framework emphasizes the importance of the marketing function and why the CMO’s role is so valuable to the company. CEOs who understand this difference empower the CMO’s role and publicly acknowledge their contributions. Let’s take McDonald’s as an example.

As McDonald’s CEO Chris Kempczinski said during the Q1 2023 earnings call, QSR brands have experienced tremendous growth in recent years thanks to their marketing efforts. Our iconic shares and strong execution position us as an affordable destination. ”

In fact, McDonald’s marketing has been at its best not just because of its attractive advertising, but because of how all of McDonald’s efforts come together to have a demonstrable impact on people’s behavior. This is because of this. This is a core function of marketing. Sure, it can be placed under the management of an experienced senior business leader, but it is best served under the management expertise of a seasoned CMO.

This gets to the heart of the matter. If a CEO does not fully understand what marketing is and what its true responsibilities are, he will always underestimate the CMO’s contribution and the importance of his CMO to the business. This goes beyond the tactics her CMO oversees and acknowledges the strategic insight her CMO brings to the adoption of behaviors. You can market without them, but why take the risk?