This summer, I spent a week with my family in a beautiful former monastery, now an Airbnb, and finally read some of the books that have been piling up next to my bed. Surrounded by quiet and a deep sense of history, I found myself thinking about the changing role of Marketing over time.
I had actually promised myself not to think about Marketing for at least a week, but as I was reading Jonathan Sacks’ Morality, one chapter in particular made me pause. It was about the role of business in society, and about something that used to be obvious and now isn’t: That a company exists to serve people, not the other way around. It reminded me of some work we did a few years ago, tracing Marketing’s roots back all the way to Adam Smith.
In 1776, Smith gave economic theory the ‘invisible hand’. If everyone pursues their own self-interest, the market will find an equilibrium that serves us all. It offered a hopeful concept but may have contained a design flaw from the start. Within a century, the same market had produced the ‘Robber Barons’, with concentrated fortunes in a few, very visible hands, and none of the equilibrium Smith promised.
Yet, for centuries after that, businesses corrected for this. Companies proudly talked about how much they paid their workers and what they did for their communities, recognizing that they owed much of their success to the environment in which they operated. Corporate purpose wasn’t a slogan. It was assumed and explicit.
After Milton Friedman made increasing profits for shareholders a doctrine, this became the norm for the next fifty years of public companies. To be clear, the problem was never about increasing shareholder value. In capitalism, it is, and should be, the essential measure of business success. The problem is what we did with it: we started to confuse short-term profits with the long-term value a business creates. Today, many businesses are led by a generation of business leaders trained and rewarded to optimize a single quarterly variable.
I don’t think this is a story about business alone. Look at what’s actually happening in the world right now, as AI acts as a hyper-accelerator. Institutions people used to trust by default have lost much of their influence. Communities are more fragmented, anxious, and polarized than at any point in my life. The old assumption that growth and human well-being move together has become increasingly difficult to defend, and society has started to notice.
Add to this the backlash against companies seen as taking sides on divisive issues, and it’s no surprise that many leaders have gone quiet. I don’t think that caution is wrong. Many companies don’t need to take a public position to do their job well, and in this environment, silence may be the sensible choice. But there’s a difference between what a company says publicly and what it allows itself to see internally. Whatever a business decides to say out loud, Marketing’s responsibility doesn’t change. Understanding what people need and feel, and telling the business the truth about this, are not political. Providing a ‘window on the world’ is one of the essential parts of the Marketing job.
Here’s what inspires me: The businesses actually winning right now, the ones growing revenues and compounding competitive advantage rather than just posting quarters, are the ones that never fully accepted Friedman’s doctrine. These businesses have figured out, empirically, not sentimentally, that long-term shareholder value is not the opposite of creating value for colleagues, customers, and communities. It’s the outcome of it. The supporting data is overwhelming: the two converge if you extend the time horizon beyond the short term and recognize all the value the business is creating.
Some valuation experts estimate that intangible assets drive around three-quarters of a company’s value today, up from a quarter fifty years ago. Most of these intangible assets, such as customer understanding, trust, reputation, brand equity, pricing power, and license to operate, are built by serving all stakeholders well.
This type of value creation and growth, which addresses the needs of colleagues, customers, communities, and the capital markets, is what we at the Institute for Real Growth (IRG) call Humanized Growth. And IRG’s purpose is to inspire CMOs to increase their impact by helping the business drive more of it.
So why do we focus on the CMO and Marketing? Because we believe that if a business is pursuing long-term growth, the function best equipped to help it understand human needs and build intangible assets matters more, not less. Yet many marketers today feel they are losing influence and being asked to prove their value solely with short-term financial metrics. The value created and the success metrics of our function are fundamentally misaligned.
That’s the challenge Marketing2030 sets out to address. In partnership with more than 25 leading marketing organizations globally, M2030 focuses on the Marketing strategy, structure, and capabilities required to win now and in the future. This isn’t another ‘how do we use AI’ study, though we’ll get there, too. M2030 sets out to define how Marketing leaders can increase their impact and help grow the business. This includes defining the kind of CMO leadership required to lead the function into the future.
Over the next four weeks, as we prepare to launch Marketing2030 in October, I’ll review the key pillars on which the Marketing2030 recommendations are being built.
As I do, I’ll be honest about where Marketing sits in this story, because we’re not innocent bystanders. For example, positioning theory, at its worst, treats perception as reality regardless of whether the underlying need is real. We’ve spent decades perfecting the art of making people want things they don’t need. This may be a small part of why Marketing has such an image problem today in the C-Suite, but also beyond. When I ask a room of twenty-two-year-olds about Marketing, too many of them tell me that we sell people things they don’t need or want and the planet can’t sustain. I believe this should bother all of us much more than it does.
Our IRG experience from working with over a thousand CMOs tells us there’s a version of our profession that’s the opposite of that. Marketing, done well, is an essential business function, helping the company return to the fundamentals of understanding what people actually need, speaking that truth within the business, championing humans in the era of AI, and turning unmet human needs into profitable business opportunities.
And when done well, long-term shareholder value will follow.
Next week: The M2030 Growth Paradoxes.
My Best,
Marc de Swaan Arons
