in Technology

Where Should Product Marketing Report?

There’s an age-old debate in the product marketing (PMM) community about whether product marketing should report to Product or to Marketing. At the time that this was asked on Sharebird, I gave the academic cop-out of “it depends”, but over time, I’ve arrived at a strong viewpoint that product marketing should generally report to marketing. Here’s why.

Good organizational design is important to me, and at the highest levels of the company – the executive team – there should be a healthy tension. I believe the best outcomes come from inclusive decision-making, as placing too much control on one executive leads to unfavorable outcomes. Not only that, but your employees know who the first-class executives (the CEO’s most favored children) are, who the second-class executives are, and who’s on the margins (unfortunately, usually the VP of HR, though HR often doesn’t do itself any favors and that’s a blog post for another day). So, for example, if you should invest too much authority in the CFO without checks-and-balances, you can expect that CFO to implement overly rigid controls, squeeze research and development investment, and run an excessively lean SG&A department as a cost center with poor processes that end up strangling the company. A similar situation arises if, say, sales is king: the organization will optimize for short-term results (taking “specials”, or custom work, onto the roadmap) at the expense of long-term company viability and building a product for a market.

There are two ways to set up healthy tension between executives and their departments. The least effective is procedural. An example would be to force sales to get the CFO or delegate’s sign-off on nearly every contract deviation from the list price i.e., not giving sales very much discount authority. This frustrates sales representatives and inhibits them from being to effectively do their job, with little consequence to the CFO for implementing such a draconian process. This, by the way, is why procurement functions inside companies are so hated. I joked that in many firms, procurement is an Orwellian name, as its role seems to be to prevent the company’s employees from procuring anything. That’s because they are often incentivized solely on keeping costs as low as possible, seeing costs as evil – as opposed to the lower innovation velocity that a firm attains because of finance squeezing blood from a rock. You get the idea.

More effective is to set up a structural healthy tension between departments, and I can see no better structural tool than at the organizational chart level. Sales complaining that the leads coming from marketing are garbage? Put sales development (SDR/BDR) in marketing. Engineering refusing to build what customers want and what product management has defined? Put both product and engineering under a single leader so there’s one throat to choke. And finally – marketing having trouble understanding users and buyers, and product management’s value propositions are unclear? Put product marketing in marketing.

Obviously, I’m painting these organizational structures as the only ones that lead to these problems being solved, and that’s not fair. And I can only credibly hold strong opinions about product marketing’s reporting structure, because that’s what I know best. When product marketing does not report to the CMO, then an organization’s positioning drifts, and messaging often starts sounding like generic marketing textbook copy that got sent through a Markov chain generator, with no meaning or differentiation at the output. The marketing organization also starts to lose resolution on the specific nuances of its buyer and user personas and doesn’t have domain experts on staff to hold copywriters and campaign specialists’ feet to the fire. At the same time, product management also gets frustrated because product adoption is low, yet they often refuse to regard their peers in product marketing as strategic partners when they are told that their value propositions are muddled and unmarketable. When product marketing reports to product, they invariably become the second-class citizens in the department, behind the actual product managers. In fact, some chief product officers don’t even know what product marketing does!

All this points to the conclusion that product marketing should ultimately report into marketing. The CMO gains domain experts who can guide his or her staff creating impactful campaigns and messaging, and an organization who can advise the CMO on product strategy and allow him/her to go head-to-head with the CPO; the CPO is incentivized to up-level his/her staff such that they can explain the value proposition of products or features with sufficient clarity that marketing as a whole can market them (and by extension, have a bigger chance of success in the market).

There is one final reason to have PMM report into marketing, and that is simply access to resources. R&D, of which product-marketing-in-product is part of, is funded at too low of a level for PMM to drive effective outcomes. Meanwhile, the appetite of an organization to spend money on marketing activities is much higher, because that spend is a function of the revenue forecast. Getting product marketing out from under the thumb of product practically guarantees a higher ROI on every marketing dollar spent.

Write a Comment