The digital age has originated an amazing phenomenon: the appearance of hybrid professionals called marketing technologists. At the theoretical level it is a thought-provoking concept, but watching it transform into reality is not so simple and can create misconceptions in this fast-evolving digital world where IT and marketing are strategically converging.
Whenever we hear the word “digitalization”, we must understand that it is the sound of inevitability and irreversibility. The digital economy isn′t on the horizon anymore, it′s here and it is here to stay. It’s no longer a secret that the digital economy is changing the world at an unprecedented rate. Companies that are looking to succeed in this fast emerging new economy must transform themselves by reinventing their business models, strategies, processes, and practices, and that impacts on the roles of all of its employees, as well as bringing departments to work together, once everyone is more and more dependent of technology to function.
It’s no surprise that marketing is rapidly becoming one of the most technology-dependent functions across all businesses. Gartner has predicted that by 2017, a company’s chief marketing officer (CMO) would be spending more on technology than its CIO, and that is becoming more credible every day, as many CMOs have adopted technology in their everyday activities, showing that technology became the core of marketing nowadays. Every year, CMOs are globally directing their budgets to the usage of technology or software in many different marketing areas. The chart below shows in which areas CMOs are planning to use technology in 2017:
In addition to those numbers, IDC Research has also released a few predictions on how marketing will strategically use technology to accelerate client acquisition, brand awareness, to gather and analyze market and customer information and even to optimize its operational efficiency in order to generate more revenue for companies and be more accurate when directing resources, mainly by enhancing customer experience. Below follows a list with the main predictions from 2017 to 2020 on this subject:
1. In 2017, CMOs will spend more on content marketing assets than on product marketing assets: For decades, the product launch has reigned as the kingpin content event. With a “bill of materials” stretching through multiple Excel pages, product marketing assets suck up a major portion of the marketing budget – and much of that content is wasted. The days of product content dominance are numbered. Product content will remain important, but it will take its place behind the content marketing assets matched to decision-journey stages.
2.By 2020, 50 percent of companies will use cognitive computing to automate marketing and sales interactions with customers: A few leads go right to sales. But the majority need further qualification and extended nurturing. Companies will increasingly turn to smart systems that automatically assess and respond to buyers at the point of need. IBM recently added Watson to its marketing cloud offerings. The question is not when cognitive marketing will become mainstream – but rather, will anyone notice?
3.In 2017, 20 percent of large enterprise CMOs will consolidate their marketing technology infrastructure: Marketing has been absorbing marketing technology a bite at a time for more than a decade. Many organizations now manage dozens (if not hundreds) of point solutions. Just as marketing environments are hitting the wall of this operational complexity, marketing tech vendors are building solid integrated platforms – tailorable through a partner eco-system. A fortuitous convergence of supply and demand.
4. By 2018, predictive analytics will be a standard tool for marketers, but only a third will get optimal benefit: Early adopters of predictive analytics for buyer behavior report amazing results. The benefits come from the ability to discover hidden segments that have a high propensity to buy. Marketers can also better serve these segments with behavioral targeting. However, the majority of marketers face big challenges to achieving the benefits. Chief inhibitors? Lack of statistical skills, stubborn organizational silos that won’t integrate data, and a culture that resists truth when it goes against tradition.
5. By 2018, 50 percent of CMOs will make significant structural changes to their “intelligence” operations and organizations: “Intelligence” as a capability is growing in importance in modern marketing organizations. Intelligence includes market intelligence (MI), business intelligence (BI), competitive intelligence (CI), and social intelligence (SI). In the past, these four functions were spread around the enterprise. Now, IDC sees more companies consolidating into a larger, single, intelligence group – often combining with intelligence functions from other areas like sales. The elimination of silos in this important area is a positive sign.
With that perspective, it is clear that technology has turned a black art into hard science. Marketing now must be well versed in customer data, analytics, mobile, social and marketing automation tools, and that requires new type of executive. The Chief Marketing Technologist is emerging at the center of this transformation as a part strategist, part creative director, part technology leader, and part teacher professional. Its mission is very clear: align marketing technology with business goals, serving as a liaison to IT, and evaluating and choosing technology providers. About half are charged with helping craft new digital business models as well.
The best CMTs are able to set a technology vision for marketing in the digital age. They champion greater experimentation and more agile management of that function’s capabilities, as well as act as transformation agents, working within the function and across the company to create competitive advantage and collaboration. It is not difficult to enlist some of the main reasons why this new executive has emerged:
Software became the chief means of engaging prospects and customers: A marketing team’s choice of software and how to configure and operate it, along with how creatively the team applies it, materially affects how the firm perceives and influences its audience and how the audience sees the firm.
Digital marketing and e-commerce skills: once those two methodologies increasingly augment or replace traditional touchpoints, the importance of mastering those capabilities grows. Digital marketing budgets are expanding annually at double-digit rates, and CEOs say that digital marketing is now the most important technology-powered investment their firms can make.
The rise in digital budgets: it is not merely a migration of spending from traditional to digital media. A growing portion of marketing’s budget is now allocated to technology itself. A recent Gartner study found that 67% of marketing departments plan to increase their spending on technology-related activities over the next two years. In addition, 61% are increasing capital expenditures on technology, and 65% are increasing budgets for service providers that have technology-related offerings.
Efficiently manage all this technology: there are now well over 1,000 marketing software providers worldwide, with offerings ranging from major platforms for CRM, content management, and marketing automation to specialized solutions for social media management, content marketing, and customer-facing apps. Relationships with agencies and service providers now include technical interfaces for the exchange and integration of code and data. And bespoke software projects to develop unique customer experiences and new sources of advantage are proliferating under marketing’s umbrella.
The reason why this is a growing role within companies is very simple. In this new digital economy environment, the CMO and the CIO must collaborate closely, although this executive-level cooperation isn’t just enough. A supporting organizational structure is also needed and vital for this collaboration to work properly. A company can’t simply split marketing technology down the middle and declare that the CMO gets the marketing half and the CIO gets the technology half. Such division might look good on paper, but it leaves yawning knowledge gaps in practice.
Marketing might not understand how to fully leverage what IT can offer, and IT might not understand how to accurately translate marketing requirements into technical capabilities. Instead, marketing technology must be managed holistically. In a virtuous cycle, what’s possible with technology should inspire what’s desirable for marketing, and vice versa. The right structure will help marketing become proficient with the array of software it must use to attract, acquire, and retain customers. It will help marketing leadership recognize how new technologies can open up new opportunities and allow marketing to deftly handle the technical facets of agency and service provider relationships in both contract negotiations and day-to-day operations.
The chief marketing technologist role itself is already an acknowledgement of just how important the marketing group is to driving revenue within the organization and, when properly resourced, how today’s marketing information systems are driving the current and future growth of the business. Only by bringing the CIO and the CMO together can the CEO have a complete picture of what insights must be acted upon quickly in order to establish or maintain the top market position. In a nutshell, the power comes from the intersection between marketing and IT.
Today, companies can no longer afford separate silos between marketing and IT. The rapid collapse of these silos means that one person must be able to converse seamlessly between both groups. While many CMOs are getting their arms around the technology side of their business, the natural evolution of this role is for the CIO to improve its marketing skills in order to grow into the Chief Marketing Technologist role. The faster we embrace these trends, the bigger the impact we will have on our bottom line. This is the imminent future of the industry, and it’s the reason chief marketing technologists will be in high demand within 2017 and in the years to come.
Marco Antonio Cavallo is a technology/digital transformation evangelist and expert when it comes to the strategic role of CIOs, technology strategy and trends, FinTech, InsureTech and technology applied to business in many different countries and cultures, providing cross-border strategic orientation for different industries and executives. Given his corporate experience of almost 20 years, he brings a variety of insights, trends and market perceptions about different technologies and their usages in the Digital Economy.
Marco is the Founder and Chief of Research of the CGN Research & Advisory Group and has a successful professional history in many well-known international companies, such as Gartner, SAP Ariba, Comarch Systems, Volkswagen Financial Services (LeasePlan) and Lexmark International. He is also the founder of the CIO Global Network Group that gathers 7.500+ CIOs and other IT senior executives around the world, advisory board member for the Innovation and Technology Committee at the Florida International Bankers Association (FIBA), advisory board member for the Innovation and Technology Committee at Federación Latinoamericana de Bancos (FELABAN), author of many articles about digital transformation, technology trends and the role of the strategic CIO, among other IT-related topics and an active member of the IDG Influencer Network. Marco is an international keynote speaker for many different themes and conferences, such as Cl@b/Felaban 2017 (USA), Gartner CIO Summit (México), Mondato LATAM Summit (Argentina), APICON 2017 (Brazil) and Data Science Forum 2017 (Brazil).
Marco graduated in business administration by ESPM-SP University, MBA in Corporate Finance and Economics by FGV-SP University and has been through different specializations in many international renowned institutions such as Northwestern University/Kellogg School of Management (U.S.), McGill University (Canada), Florida International University (U.S.) and Erasmus University (the Netherlands).
The opinions expressed in this blog are those of Marco Antonio Cavallo and do not necessarily represent those of IDG Communications, Inc., its parent, subsidiary or affiliated companies.