Some marketing departments undoubtedly will have to deal with smaller staffs this year beyond because of budget cuts. Some already have made marketing-staff cuts, whether it’s full-timers, contractors or agency team members. OK, so this isn’t a new phenomenon. 

However, because of the COVID-19 world health pandemic, some reports see pretty dramatic changes coming for marketing leadership and staffs. Forrester in one estimate says 469,000 marketing jobs will be lost by the end of this year. Chief marketing officers (CMOs) told Gartner they’ve reduced this year permanent, temporary or contract headcount by about 37%.

Two-Dimensional Marketing Staff Issue

How can marketing leaders like CMOs prepare for a potential reduction effect on their marketing staffs? Knowing the stakes is a good first step, according to Pete Hayes, principal at Chief Outsiders, a marketing management and consulting firm.

Hayes cites two dimensions to the forecast of fewer marketing jobs:

  • One, companies will downsize to compensate for the shrunken economy, and marketing budgets and headcounts are in the crosshairs.
  • Secondly, agencies are being hit from declining, especially traditional, media budgets and appropriately reducing staff size or changing entire business models. Most commonly, they’re changing focus from being the Agency of Record (AOR) to a nimbler, more relevant project model.

“CMOs are faced with continuing to deliver results with reduced resources, clearly,” Hayes said. “But the mature ones have been here before. It’s not unlike the 2008/2009 timeframe. Same headlines. Similar shifts. Just earlier in the evolution.”

Related Article: How CMOs Are Leading Through the COVID-19 Crisis

Change up the Spending Approach

Hayes served in a prior role as a corporate VP running global marketing services for a multi-billion dollar tech company in 2008. In addition to the economy, he recalled being “in the competitive battle of our lives." Budgets slashed, headcounts cut, then cut again. Regional marketing teams around the world were decimated. “But everyone needed services,” Hayes said. “You can’t cut your way to growth. We had to find new ways to deliver services. What we found was that our total spend — across all our heads and programs — was significant. But a disproportionate amount of the investment was being made in agency services and contractors.”

Hayes said his teams “swizzled” its spending approach, brought a bunch of services in-house and actually converted some contractors to employees. This, he said, required the finance department to see they could save money by reducing agency spend and increasing headcount. It ended up saving millions while increasing capacity to deliver marketing services and programs, according to Hayes.

“The short answer for CMOs: get creative,” Hayes said. “Find cheaper ways to deliver on your priorities.”

Why the ‘Who’ of Your Marketing Team Is Critical

Ewan McIntyre, vice president analyst for Gartner for Marketers, said top of mind for many CMOs today in the current environment is having the right staff on board. With smaller budgets, they’re forced to think about the quality of their team, which likely is a mix of agency, contractor and full-time staff. And with CMOs reporting to Gartner they’ve reduced headcount by 37%, who you have left for marketing operations and processes is vital.

“There is a bunch of people who are making adjustments and reducing headcounts,” McIntyre told CMSWire. “I've also heard from many CMOs that there have been hire freezes that have been put in place. That's still really consequential because the challenge is not necessarily just the net number of employees that you have. It's the strategically important hires that are bringing in those capabilities that are really fundamental for future performance.”

Marketing teams have long relied on agency team members to produce. And more and more, McIntyre’s research has found, these marketing agency team members in organizations have their “fingers on keyboards,” or, essentially, they act and operate like full-time marketing staffers. “Cutting back on external agencies is going to impact the total capabilities of organizations right now,” he said. “So from a number of different fronts, there are some challenges to team.”

CMOs are much more likely to cut agency team members before full-time staffers when they can help it, McIntyre has found. Forrester analyst Shar VanBoskirk confirmed this approach in the current pandemic among CMOs in a May interview with CMSWire. CMOs, nonetheless, have been forced into some tough decisions lately, according to McIntyre. Agencies can be incredibly useful for marketing programs, campaigns and strategies, he added.

“It’s incredibly difficult,” he said, “but the challenge really is not just the human side of things of course but also how this impacts the delivery of the strategy as well because your people are such an important part of how you build and execute your strategy,” McIntyre said. “Technology enough is not alone to do this; there needs to be a receiving mechanism in the organization to do the marketing as well.”

Learning Opportunities

Related Article: How 3 CMOs Grapple With Budget Changes Due to COVID-19

Organizations Do More With Less With Marketing Employees During COVID-19

Not all marketing industry reports find cuts to outsourced marketing. The latest CMO Survey — produced under leadership from Christine Moorman, the survey’s founder and director, and released in a special COVID-19 edition in June — found outsourcing of marketing has not changed much due to COVID-19. Nearly 60% of CMOs reported no change, while 19.4% indicated an actual increase.

Yet still, the same survey found 9% of marketing jobs lost due to COVID-19, so the reality for marketing leaders working with a smaller staff is, well, real. It comes back to how you work with smaller staffs. According to the CMO Survey, CMOs have used their marketing employees in the following ways amid the staff cuts:

  • Getting active online to promote the company and its offerings: 68.6%
  • Developing new advertising and promotional strategies: 65.7%
  • Reaching out to current customers with information: 65.2%
  • Improving digital interfaces for customers: 61.8%
  • Improving customer experiences: 53.6%
  • Deepening back end digital marketing capabilities: 49.8%
  • Performing customer research: 45.9%
  • Generating new product and service ideas: 44.4%
  • Generating new leads: 44.4%
  • Exploring new partnerships: 30.9%
  • Making contact with leads: 30.4%
  • Scouting acquisition opportunities: 11.6%

Moorman, professor of business administration at Duke University’s Fuqua School of Business, said marketing leaders and their staffs more than ever need to keep their eyes on the prize — the prize being customers. “You’ve got to keep your eyes on the customer, doing as much work as you can to understand how you can be opportunistic reaching, converting and maybe even identifying new customers,” Moorman told CMSWire. “And surviving in the short-term shouldn’t be what occupies all of your time. It’s important to take time each day planning for the future. And the future keeps changing, so we need to keep coming back to that.”

Doubling Down on Digital Competencies

What pivots can CMOs and other marketing leaders make with a smaller staff? The strategic answer for CMOs is if they’re not already leading their company’s key growth initiatives, now’s the time to step up, according to Hayes. Take career risks, understand the market and customer behavior shifts, target new opportunities and call for new products, services, pricing and promotional programs. “Every CMO will be looking for ways to immediately double their digital competencies,” Hayes said, “from sales and marketing and automation, to expanding digital’s role in the sales process, all the way to ecommerce. As an example, we have a manufacturing firm as a client where they realized they need to move the majority of their sales transactions to ecommerce so their sales teams can focus on the largest, most strategic accounts. For companies who rely on paid digital spend, they will lose it all if they’ve not proven the value of the spend. For those who are proving value, their budgets may even increase.”

Focus on the immediate to recapture ground lost during the pandemic and recession, Hayes added. Yet, the skill sets to lead a pivot in offerings and market shifts require the CMO to have the chops to lead with experience.

What to Look for in New Hires

Simply pushing everything toward digital is not always the right approach, nor is simply cutting channels for the sake of saving money, according to McIntyre. “What we would advise people who are looking at their overall headcount is looking at the capabilities that are important," he said, "but it's much better to have a team that's agile and adaptive. It allows them to shift between different skills and media to build something that's right for the customer journey. Just indiscriminately cutting away at a particular channel is not something we would recommend at all."

If you’re a marketing leader looking for what kinds of marketing chops will be important for your marketing team going forward, the CMO Survey asked what CMOs will prioritize in new hires. In order, they were:

  1. Ability to pivot as new priorities emerge
  2. Creativity and innovation skills
  3. Navigating ambiguity
  4. Emotional intelligence
  5. Data science background
  6. Curiosity
  7. Natural leadership abilities
  8. Martech platform experience
  9. Financial acumen

As CMOs look toward the latter half of 2020 and beyond, they should focus on defining the capabilities in the organization that are absolutely mandatory to the organization's survival.

“What's the layer above that," McIntyre asked, "and how’s that's going to help me build the skills and capabilities that will make us a viable organization in the future and layering and layering above that."