More than half of CMOs feel they deserve more money for the work they are doing and nearly a third of the CMOs in the top income bracket feel under-respected among their c-suite peers.
Those are just two of the key findings from the Chief Marketing Officer (CMO) Council’s new CMO Compensation Report, which includes numerous insights about senior marketing executives’ salaries, from the correlation between base compensation and their company’s size to the disconnect between compensation and job title.
Dissatisfaction with compensation could be a key driver in CMO turnover, according to the report’s author, Dr. Kimberly Whitler of the University of Virginia’s Darden School of Business. She believes there’s an increased need to better understand the why CMOs feel underpaid, and that CEOs, recruiters and HR heads should do more to ensure chief marketers feel fairly compensated.
Whitler outlined two possible reasons only 48% of those polled believe they are being paid fairly: either CMOs are actually underpaid relative to key benchmarks the report identifies or CMOs just believe they are underpaid.
The 36-page report was released Thursday and marks the first comprehensive compensation study of its kind completed by the CMO Council, a San Jose, Cali.-based network of chief marketers that has more than 7,000 members in 110 countries (more than 600 of which are in Canada).
The report explores various dynamics that influence how much CMOs get paid. Its results are based on responses from 345 global senior-level marketers.
Marketing spoke with Whitler—a seasoned senior marketing executive who previously worked at Procter & Gamble, PetSmart and David’s Bridal—and CMO Council executive director Donovan Neale-May about some of the key findings from the CMO Compensation Report (look for further insights in Monday’s Marketing Filter newsletter):
Study participants were asked to what degree they feel like they’re respected in the c-suite. While Whitler said she thought the CMOs that make more money may feel more respected, that wasn’t necessarily the case. “The people at the low end [of the salary ranges] feel the least respected,” said Whitler. Of those CMOs that make less than $100,000, 36% said they don’t feel respected in the c-suite. Here’s the surprising part: “The second-highest response [from those who don’t feel respected] is for those making more than $500, 000—29%. I found that interesting.”
The survey shows that as a company’s digital marketing performance gets better, so does its CMOs salary. Of the CMOs who earn more than $350,000, 37% rate their digital marketing performance as excellent. “The digital marketing revolution has given marketing leaders a whole new lease on life, a whole new role and centre of gravity that they haven’t had before relative to customer experience, intelligence and insight, product design and development” and many other areas, said Neale-May. “They can actually bring much more value to the table than they had in the past.”
When looking at the highest-paid CMOs – those making more than $500,000 – their accomplishments tend to be focused on transforming the marketing within their company. “Their key accomplishments tend to be restructuring marketing to drive results,” said Whitler. Proving the accountability of marketing and building digital capabilities are also important for this high-paid group – more so than with lower-paid CMOs, she said. “That tells me the CMOs that have developed skills that they can use to transform companies today are probably in higher demand and can make more money.”
She added that measuring results is a huge issue for CMOs today. She knows from personal experience in her past as a CMO that it’s not an easy process. In one of her roles she spent more than six months devising a marketing dashboard to hold her marketing group accountable. While she said the concept of marketing becoming more accountable in general gets thrown around a lot, it’s a challenging task. “These [CMOs] who are making a lot of money are tackling the biggest, most important issues that link marketing to overall firm performance. Is the CEO being told to go figure out how to restructure finance to drive better growth? No.”
Whitler said the primary mandate for top-paid marketers given by their senior management is focused on growth – from growing market share to driving topline growth.