Michael D'Esopo | Why CMOs are Losing Influence: The Trust Trade-Off

0:00The CMO Confidential Podcast is a proud member of the I Hear Everything Podcast Network. Looking to launch or scale your podcast? I Hear Everything delivers podcast production, growth, and monetization solutions that transform your words into profit. Ready to give your brand a voice? Then visit IHearEverything.com.

0:22Michael D'Esopo:Welcome to CMO Confidential, the podcast that takes you inside the drama, decisions, and choices that go with being the head of marketing. Hosted by five-time CMO Mike Linton.

0:41Welcome marketers, advertisers, and those who love them to Chief Marketing Officer Confidential. CMO Confidential is a program that takes you inside the drama, the decisions, and the politics that go with being the head of marketing at any company in what is one of the most scrutinized jobs in the executive suite. I'm Mike Linton, the former CMO of Best Buy, eBay, Farmers Insurance, and Ancestry.com, here today with my guest, Michael DeSopo. Today's topic, why CMOs are losing influence, the trust trade-off. Now, Michael is the CEO of Lippincott, one of the premier brand strategy, design, and customer experience consultancies.

1:20Prior to becoming CEO in 2025, he served for more than a decade as the firm's director of brand strategy. He has a great long-term view of the convergence of strategy, branding, AI, org design, and customer experience, which spans one hundreds of companies. Plus, his firm recently released a study of more than 500 marketing leaders, which reveals a CMO trust trade-off. We're going to talk about all of this today. Welcome, Michael. Well, thanks, Mike. I'm glad to be here, and I'm looking forward to the conversation. It'll be super fun. Let's jump right in. Tell us about the trust study. Why did you field the trust study, and what are the top lines?

2:06Sure, yeah, and I think a big piece of this is, you know, Lippincott's been around for 80 years. I've been with the firm for more than 20, and in the past 10 years or so, we've increasingly spent more and more time with chief marketing officers. And as we think about how we help chief marketing officers, we help them often with some of their toughest brand challenges, whether that's a repositioning, a rebranding exercise, a change in what they need to be able to do to react to changing customer demands. And so we wanted to dig in and understand what are those needs that are changing from a CMO perspective?

2:42How do we really think about broadly what are all the things that they're concerned about. A lot of studies jump in and are focused on the importance of AI or the role of creativity. And those are important, but I think we wanted to try and put that in a broader lens and a broader context. So we worked closely with Bloomberg Media. We did this study, as you mentioned, with more than 500 CMOs. And what we found is that those marketing leaders are sitting at the intersection of almost every major force. They are at the front lines around AI disruption. They are increasingly facing pressure for measurable growth, fragmented customer behavior, and especially increased organizational complexity.

3:21So what we came out of this is there's a set of marketing issues and marketing problems that they're grappling with day to day. But increasingly, the biggest CMO problems are actually organizational problems. What we found, some of the big findings were, first, short-term performance pressure is really reshaping the CMO role. Second, the companies that are best prepared for what's next aren't necessarily the most advanced in terms of the use of the latest and greatest tools. What they are is the most aligned. And AI, while being very important and it isn't making brand fundamentals less important, it's making them more important.

3:58And increasingly, it's a tool to help marketers with some of the other pieces around creating that alignment and aligning to broader business goals. So we're sitting here and we've done a couple of shows on this, which is the pressures on the CMO are only increasing and the complexity of those pressures are getting worse. And there's been a bunch of people that have come on and said we are sacrificing long term for short term. And that is driven a lot by boards and maybe CEOs and maybe CFOs. You mentioned alignment and trust in your top top 10 here or your top list. Let's talk about what trust means and then how that affects alignment, if that makes sense.

4:41Sure, yeah. And I think if I speak about that, sort of a lot of first in the organization where CMOs are having to build broader connections and speak to the entirety of the C-suite and make sure that the activities that they are doing help further the objectives that the CEO, the CFO, and the rest of the C-suite are being evaluated on by the board. as they come into an organization they're often rewarded for media business impact efficiency short-term revenue contribution and those are positive i'm not saying you ignore those marketing does need to be commercially accountable but i think what happens is we see that there's maybe a hidden cost there that the more we optimize around what we can demonstrate in the short term there's less room for taking the longer view evolving the brand speaking to a new audience and ultimately creating future demand.

5:34I think a great example of this, I actually wrote a little article about it and I think it was in the Guardian and the Drum was if you saw the results when Adidas came out, they showed great growth, but the marketing spend was so high post-World Cup that the stock price took a big hit. And trying to evaluate the return on that investment two weeks or three weeks after the World Cup has wrapped up is probably being a bit short-sighted in that respect. It's probably crazy given the purchase cycle on shoes is probably not like it is on milk. Exactly. Or unless you're expecting everyone to walk out of the stadium and go buy a pair of shoes.

6:14I think it's one of those things where looking, and I appreciated the confidence of leadership there to say, we're staying the course. We need to be able to look beyond the immediate quarter. So I think that trust trade-off is the marketers are gaining credibility with that near-term performance, but it risks under-investing in the things that are gonna create long-term preference, long-term growth. And let me ask about that near-term performance thing because if you come in and you, the other thing a lot of people do is fire an agency, which I think is crazy because then you say, I'm gonna fix everything with my new agency.

6:48And a lot of times it's not the creative or the media problem. But you're saying in an effort to look good or not get punished early, People are trading away what I'm going to call strategic power. Is that what you're saying here? If I come in and I move all this nuts and bolts around and I do better, I've traded away a lot of credibility in an effort to be off to a good start? Or what are they doing that's wrong there when they do short-term results? Are they positioning them wrong for the long term? I think it's more of that. I think it's really that idea of there's probably some short-term gains that are quick to get.

7:28You want to demonstrate those quick wins. But ultimately, the charge of the marketer, the CMO, is really to tie into where is the company going? What is the broader business strategy? How do we become relevant and differentiated for not just the customers of today, but how we serve the customers of the future? Whether that's we need to go speak to a new segment. We need our existing customers to think of us more broadly and deepen relationships. There are things like that that take time. And I think if there's too much emphasis on the short term, you don't build in the time and enter. You need to balance that, right?

8:03You need to be able to start laying those seeds around how are we going to be growing 12 months from now or 24 months from now and recognize that those perceptions don't change overnight. Well, we have this thing, one of the ways I like to think about is sales overnight, brand over time. You have to do both. And one of the things about managing the short-term performance marketing in particular is you ought to have someone doing that that gets a lot of credit. But if you trade all your cards in as CMO, you lose kind of your position maybe. And then behind this, though, is probably a misconception or a misalignment to your earlier point between CEOs and boards and marketers.

8:45Yes. In terms of why they hire and what they expect and then how they manage the marketing in general. Any thoughts on that? Sure. Yeah. And I think this is something we're in the midst of seeing across how CMO clients are engaging with these audiences, or I'd say the best CMOs are engaging with the CEO and CFO and the board. I think in the past, you'd look and say a CMO is going to come in, they're going to have their own set of marketing measures. We're going to have, whether it's the purchase funnel, whether it's a set of how we're driving those specific measures that are very marketing specific and almost, I would argue, a bit siloed.

9:24increasingly the best CMOs that we're working with are going what is it that the CEO is being evaluated on how does marketing help contribute to some certainly not all of those there's a broad set of measures that boards are looking at there and being able to build a really crisp and clear story about here's how marketing is going to help with the of these eight things on your scorecard we're going to be able to help with these two or and then maybe it's a different conversation with the CFO in terms of the things that are on your scorecard. Here's how marketing is going to help with these one or three or whatever it is.

9:58So you end up having that CMOs don't have just one overarching marketing story, which they need for the organization, but they need those translations that work across different parts of the organization to really build in that connectivity and demonstrate how marketing is going to impact the other dimensions that the rest of the organization is focused on. we've had a we've had a number of guests including cfo say for god's sake tie yourself to the financials will you it's the one thing everyone here understands and all our investors understand don't make me work so hard on it you end up in a debate of like well you know how much of it you know in terms of how much of this was brand and how much of this was the marketing and how much of this was the sales channel and i think just being really clear about here's where we're where we believe marketing is going to have the greatest impact on these specific measures.

10:51And we're going to show that our activities are focused in that way. I think it requires taking a stand and making a commitment. But I think that focus is really critical for demonstrating success and demonstrating an understanding of what keeps those audiences up at night. Hey, and you're in the seat where you talk to a lot of CEOs probably as well. What do CEOs ask you that CMOs rarely ask? I think it is a little bit of that question of how is this going to help me grow the business? I think the growth agenda continues to be a priority. And I think in the absence of getting a clear answer on growth, that's where you see CEOs shift their emphasis and view the CMO as an execution leader, where the CMO might report into a chief growth officer or a chief strategy officer or even a chief revenue officer.

11:44So you see that in that case that the CMO becomes sort of one arm of execution of a broader business agenda. I think really trying to understand that piece and the CMOs that I've worked with that actually are, you know, chief marketing and growth officer are the ones that are demonstrating I've got a broader aperture on this marketing is a means to an end. And again, that growth piece is so important, particularly for all the publicly traded companies that we work with, really tying it into that and understanding that we're not here to win an award for an ad campaign. We're actually here to drive greater growth.

12:16We're here to drive greater engagement. We're here to build loyalty to our customers to prevent them from switching to somebody else. I think those are the things that become really important to be able to say, here's how we're going to contribute to that broader growth agenda. Yeah, we've had a number of guests and I agree with them say all the marketing measures that don't lead to sales or profits are just diagnostics. Exactly. It's you're telling a really long and complicated story of. And I mean, I'll admit it early in my career. I did these things. I did these exercises where it's like if we improve consideration, then that's going to improve employee engagement and employee will deliver a better experience.

12:54And you end up to that daisy chain is true, but it takes a really long time. And if you're spending all of that time explaining those things, you're losing the ability to have that impact. And so really trying to dig in and instead of trying to be comprehensive of like, here are the myriad of ways, here are the one or two or three most important ways that we're going to help drive growth for the organization. Well, and I also think one of the things that I would tell marketers in this game is, do you really care about everything HR is doing or reverse logistics or some of the other stuff? I don't think you do.

13:29And that's how they probably are thinking about your measures when you talk about them. Right. And they're really busy making outcomes. Make an outcome. Don't talk about the measure. Yeah, and I think the HR example is a good one. We have had times where we've worked with, you know, the war for talent, which I think was far more prevalent five, six years ago as we were in the early stages of coming out of COVID. That's where, again, a strong alignment there between marketing and HR. that may not be as important from a CEO or CFO, but if it's on their priorities, how does a brand that is a talent attractor or better yet, a talent retainer, and those are some times where we have helped keep marketing officers bridged back out.

14:12Let's talk about that because that leads right into the next topic I'd like to talk about, which is the complexity and expansion of the CMO remit to now include customer functions, customer experience, call centers, you know, sometimes the employment brand with HR. Tell us how that's playing out and how all this is seen through the lens of the enterprise. Sure. Yeah. And I think there are instances where you are seeing that expanded remit. I think there's a recognition of the importance of connecting marketing and the experience. we used to talk about how the role of marketing was to inform and drive communications that was a long time ago it's communications and experience particularly in so many industries where your experience is shaped by a service as opposed to a physical tangible product so the CMO is being seen as owning the customer agenda but may not have as much control and often doesn't have direct control over product or technology or your call center.

15:19And so how do we start to think about building that common understanding so that that's really building influence across the organization to be able to say, here's the promise we're making out to the marketplace. How do we actually demonstrate that in the ways in which we show up? And that is hard, right? Like, and I think, but that's where you get to engage. And it's not about the chief marketing officer to figure that out, but it's to educate and inspire in many respects how the organization can come back to the table with ideas. And I think one of the things you're arguing for, at least I think so, is that you have customer measures that are shared by everybody versus marketing measures that are driven by marketing.

15:58And those customer measures also lead to retention and more sales ideas. No, this is, again, a client I worked with years ago. We were creating a new brand for them. We're going through the exercise of establishing their brand attributes. And one of the attributes that they had landed on was approachable. Now that's just a word. Lots of companies have approachable, but we were meeting with folks in the call center as part of explaining what we wanted the brand to stand for. And one of the rank and file folks, one of the call center employees said, if we want to be known as approachable, why am I getting measured on how quickly I hand off the call.

16:34Which is a great question. And it was a great, and the exciting part was it came from that, it wasn't marketing coming in, telling what the answer was, but it was facilitating that conversation. And all of a sudden, you know, while there's a whole bunch of reasons why you might want to shift to first call resolution, and there's, you know, a bunch of research around that front, this was the, this was the frontline employee going, evaluate me on first call resolution. And guess what? The approachability will come, will come with it as well. I'm going to be approachable at speed is what I'm going to be.

17:04Exactly. And so I think that those are the aha moments that get me excited because then it's about seeing that the brand take hold in the organization in a way that employees go, I get it, right? I know what I need to be able to do to deliver against the brand. Well, especially the customer experience thing where you can't actually, if you have a giant interface, if the employee doesn't believe it and they're paid on speed and profit only, they almost always short the customer when you when you look at this michael what are cmos because you can see the whole game if you would say in general what are cmos consistently under investing in today given all the pressures we just talked about yeah and i think there's probably you know around that connection between brand and customer experience and again i think the question there becomes are the cmos under investing in it or is the organization under investing in it there will be a lot of times where we see the customer experience focus is around driving and driving efficiencies lowering cost and that's critically important not not gonna say you shouldn't be doing that but the next step in terms of how do we pay off the promise what is the branded moment that we need to create how do we pay off that idea of what we want to be known for in the experience so that it just doesn't feel like an efficient experience, but there's a branded experience there.

18:29And then I do think the other piece may be around underinvesting, less about, oh, we need to be in this channel or that channel, but it is what is that connective tissue? How do we get the systems and the data and the alignment to be able to show up more consistently across more points of the experience? And beneath that comment, I'm sensing there's a, if the data doesn't move across the company at speed about the customer, the customer will eat it basically yeah is that fair yeah and i think we're seeing where there is no shortage you know the explosion of data both the actual customer data and companies getting better about capturing more of it plus ai enabled data so there's no shortage of the data piece i think the hard part is translating all of that data into meaningful insight and into meaningful action um that becomes the you know and simple and clear and directive action um it can be over it can actually be more overwhelming rather than, you know, rather than getting alignment around here's the direction we need to go, because I got a set of data that tells me one thing.

19:32You have a set of data that tells you something else. And so how do, you know, we end up having a lot of swirl trying to figure out, well, who's right, who's wrong. You know, I'm going to spin my data one way. You're going to spin it another way. And then we end up at loggerheads. We just dropped a show on that called too much data, not enough thinking by a data person, which brings me to you have a good seat for how ai is going to change the business in the marketing department what's your take yeah um i you know it is definitely you know i'm not gonna nothing radical here in terms of it is changing things and quite radically i think the biggest piece we're seeing as we talk as we think about working with clients and specific brands is this idea of call it visibility or discoverability the things that we would look for as consumers and the way you think about the classic funnel of how do I get you aware and how do I build understanding and consideration.

20:26There's a whole set of things where the machines are how they go about discovering, finding you, getting, you know, looking at what's being said about you to shape the answer that they give back to you as a customer. We do a set of, we've done research for a number of years. We talk about the importance of being a go-to brand and how do you build connection and progress. And we do that research with consumers. we're in the process of going how do we do this for the ai for the machines right machine legibility how do we make sure that we're thinking what does it mean to deliver connection and progress to an llm um so how do we actually start to think about that as an important i'll call it an additional audience whether it's an audience or a channel but how does how does a brand get discovered and get served up to customers and in particular if you're sharing a bunch of information and the LLM knows a bunch about you, how do we make sure that we're facilitating that match?

21:22So there is a bit of that in terms of the fragmentation, in terms of the data, but then also trying to think about where do we need to be that's a little bit different? Where's the machine going? And how do we make sure that we're there and building the impressions that we need to be able to build? And there's no roadmap for this. And so there's no roadmap for the organization either yet because everyone's inventing it what's going to happen to the orgs with this new pressure on it because um you know rashad tobacco while i was on the show and he said it it's it's like hydrochloric acid dissolving the org structure yeah because the consumer's just going to see the the company and the brand and that's it yep no i i think that's true and i think that you know there's a lot being written now of all of the increased usage and the increased spend right There's a question in terms of as companies go and spend money and make more tools available to their employees, how are they actually demonstrating and delivering return on that investment?

22:25And a lot of times we're hearing stories where it's, okay, an individual is using AI to help with their particular task rather than reimagining. So we're looking at token costs and what am I getting in terms of the token costs? but are there other ways that the i suspect we're going to run into companies coming to a reckoning about how do we use the tools that are there for the work and which people need which tools for which occasions to get to those answers because we can't just have it be everybody gets everything and you know there's tokens are not free well no i think i think a lot of companies are coming to realize that right now tokens are not free hey so you you've been associated with some of the world's best known brands for your whole career.

23:11What's the one lesson about growth that surprises clients the most, or you would share with our listeners that you've observed? Yeah. And this one may sound rather simple and straightforward, and I hope it doesn't because it's actually really hard, is that growth does come from that alignment and focus. It really is that connection between clarity around where the business is going, how the business expects to grow, what's that overall business strategy, what's the role that marketing and the brand in particular play in contributing to that and having that strong alignment so that you don't have that organizational friction, that there is a clear path around sort of here's how the brand's going to soften the ground to make it easier to sell, or here's how our brand is going to build greater resonance and loyalty within our customer base so that we are able to deepen relationships or we're able to protect against switching behavior um yeah sorry how do you measure alignment say i'm out there and i don't have a really great way to measure this in one of our listeners i want to get started on measuring alignment across my org what are some questions or tools or methods you would record.

24:28Yeah. And we do this when we're, you know, we're spending time around how, how do the, how to more internally, right. Sort of internal branding alignment. And, you know, we have a series of very simple questions. Some is like, I know what my brand stands for, you know, to all the way to, I know what I need to do in my job to be able to deliver against the brand. And some of those are very simple, but they're often a very effective diagnostic around, do we have an, you Is this something where we're telling a story and our employees don't either know it or don't even believe in it? That's the type of activities.

25:05Or have instances where I know the brand, I love the brand, I'm going to run through the burning building for the brand, and I have no idea what I'm supposed to do other than run through the burning building. So I think those are different ways that you start to get at how to make sure that it isn't just, oh, I love working at this organization and I love what the brand stands for. what is it that I'm doing and I'm not in the marketing organization I'm in sales or I'm in customer I'm in the call center those I think are really interesting around sort of breaking down that organizational friction and helping people see ways in which they're contributing to what we're trying to do more broadly and there's tons of companies that they they are the brand the front end of the brand you know Comcast like 10 years ago Comcastic and we're customer centered i'm like so when you're going to come out and give me a service call you give me a 24-hour window of our 12-hour window exactly fantastic yeah yeah that doesn't feel very yeah and that's a good example of where i think they've improved right like that they have they've gotten so much better on that and some of the airlines as well yeah i think that's another good one where you know and we've done some work in airlines where it's really hard right like that is a tough business.

26:21Fuel costs are going crazy. There's a lot of things you can do. And I think even just looking at that broader picture through the view of you, the customer or the passenger, that's where you started to see a lot of instances of like the old days where you'd have to go to the counter to check in and move it to the kiosk. That was the first piece. Well, now you can do that at home, right? How do you basically get away from those friction points as it were, and you're able to create some of that ease early on. Or you get to things like onboard Wi-Fi. I remember I'm a loyal Delta flyer. I've flown them for years and years and years.

27:00I'm fairly certain they were not, I know they were not the first airline I flew to have Wi-Fi on a plane. But what I do know is that they were the first airline I flew that had Wi-Fi on virtually all the planes. Yeah. Right, so it's not necessarily about being, another airline may have been first And it's like, great, that's there on that one plane. But the next flight, it wasn't. Or it's only on 20 % of the aircraft. For it to be, I know it's going to be there. I know it's going to be something that I can have as part of my journey. That becomes part of the experience and creates some distinction.

27:35And while we're on airlines, the counter and the in-flight service personality matters so much. And you could say, do I have genuinely happy and pleasant people? Or do I just have efficient people? And that makes such a difference. Yeah, we've done some research there. I think it is a few years old, but this is a good example of where brand can matter is, if you go back, I can't remember how far back we did this, but at one point we looked at, which airline, two airlines lose bags at the same rate, but one gets 10 times more complaints. And that distinction, I would argue, is where brand comes into play.

28:15It buys you forgiveness in that instance. And everyone will focus, the amount of money and resources focused on the operational measures of, we're going to, I don't doubt for any second that every airline is trying to reduce the number of lost bags, but you can spend a lot of money and still not, you know, and make a little dent. Or if you have a stronger brand, you've bought a little forgiveness to be able to get you there while you continue to improve. I agree with that. Hey, before we get to our last question, one question. advice you would share to our listeners about careers in marketing, particularly those early on in their career?

28:52Yeah, I would say, you know, from those in marketing, and I actually, I admit, I did this with my daughter, who is, you know, a new college grad in the marketing world. Wherever you end up, you need to make sure that you understand the business that you're in, that you're working as a marketer. She ended up working in a professional services firm. It's not something she knows a great deal about. It's actually a law firm, right? She's not a lawyer. But I said, you need to make sure you understand that the marketing activities that you do, how is that helping that firm? And that can be things around sort of understanding what they're trying to accomplish.