Operational Transformation Needed to Align Marketing and IT Groups as Companies Seek Competitive Advantage in Fast-Changing Digital World, Finds Study from CMO Council and Accenture
Research reveals opportunity for CMOs and CIOs to increase revenue by using digital marketing to enhance customer relevance, insight and personalized interaction
PALO ALTO, Calif.; Oct. 4, 2010 – Operational change is required for corporate marketers and information technology (IT) professionals as they seek to “lead not lag” to embrace new digital marketing technologies and channels in the quest to acquire, maintain and enhance customer relationships and increase revenue, according to a new report from the CMO Council and Accenture (NYSE:ACN). Another key finding of the report, titled “The CMO-CIO Alignment Imperative: Driving Revenue through Customer Relevance,”is thatmarketing and IT executives do not believe they are highly effective partners, as they struggle to achieve common goals in the race to adopt and keep pace with rapidly evolving digital marketing capabilities.
In fact, very few marketing and IT executives surveyed for the report believe their companies are prepared to exploit the new digital channels, despite their shared conviction that technology now underpins and shapes the entire customer experience. Specifically,just 4 percent of more than 300 marketing executives and 7 percent of the more than 300 IT executives who participated in the study said their companies are very prepared to exploit digital marketing channels. Additionally, only 8 percent of marketers and 6 percent of IT executives said they believe their data and analytics are completely integrated. And nearly than one-third of marketers and IT executives alike (29 percent and 27 percent, respectively) said they are either having difficulty integrating critical analytics capabilities or believe they are not integrated at all.
As customers increased their demand for always-on access points, service options and interactive experiences, a large majority of marketing executives (78 percent) and IT executives (68 percent) said that digital marketing is important to their organizations. Yet, only one-third of marketers (35 percent) and one-fifth of IT executives (20 percent) said their companies are “heavily committed and invested” in digital marketing.
“Marketing and IT executives recognize the importance of enabling digital marketing and integrating online and offline channels, but they need to move beyond the issue of alignment to make the unprecedented and transformative game-changing moves required in today’s marketplace,” said Tim Breene, senior managing director of strategic initiatives at Accenture and chief executive of Accenture Interactive, an Accenture business that helps companies enhance their digital marketing capabilities, including websites and online marketing, and optimize their online and offline marketing and merchandising investments. “This research can serve as a wake-up call to savvy CMOs and CIOs, who are looking for the next frontier of success: A fully empowered digital enterprise, capable of forging and maintaining continuous relevant relationships with its customers.
“As these new, nimble marketing organizations emerge, marketers will be able to pioneer new methods, approaches and programs, driven by a unified backbone of data to create the end-to-end customer view.”
In further findings, the research reveals that both marketers and IT professionals appear to be in close agreement on the value and impact of digital channels of engagement and the strategic areas of focus for closer CMO-CIO alignment. However, challenges and roadblocks remain, as nearly two-thirds (64 percent) of marketers and half (48 percent) of IT executives said they have experienced problems or challenges with implementing marketing solutions or IT projects to further marketing effectiveness.
Both groups agree that delivering more timely and relevant transactional, behavioral and customer insight data is at the top of the list. But on the IT side, there also is a focus on automating customer interactions, improving customer care and handling, as well as furthering the use of social media for online listening and interaction. Marketers, however, said they would like IT to improve the links and alignment between functional marketing, sales and channel groups, and to deploy better marketing execution platforms and operational systems.
Neither IT nor marketing seems prepared to capitalize on investments once they have been made and implemented. Insufficient funding (cited by 59 percent of marketers) and a lack of understanding of the opportunity by senior management (cited by 46 percent of IT executives) are viewed as the primary constraints for those who were unprepared to capitalize on the opportunities. However, while marketers believe that customer insight and intelligence are critical to competitive advantage, they are finding it difficult to gain IT support for better integration and mining of disparate customer data that is often isolated and under-utilized across organizational silos.
The Struggle to Keep Pace with Digital Innovation
“Marketing is struggling to keep pace as new technologies that address functional, operational and go-to-market efficiencies and engagements are introduced, often circumventing IT in order to quickly deploy solutions that are not integrated into enterprise structures and systems,” said Donovan Neale-May, executive director of the CMO Council. “This desire to embrace the latest marketing innovations leaves IT in the position of having to fix, patch or repair point-solutions that have little impact on IT strategic goals and can detract from senior management’s up-time and security directives.”
The study found that, in the absence of top-down engagement in the digital reinvention of marketing, there is a noticeable disconnect between IT and marketing executives about who they believe is leading the digital strategy for their company. More than half (58 percent) of IT executives said they were championing, spearheading or shaping the digital agenda at their company, whereas fewer than one-fifth (19 percent) of the marketers said that the digital agendas at their companies were being shaped by IT executives. Instead, 69 percent of marketers said they were the ones in the driver’s seat.
“This disconnect and challenge over strategic vision and ownership has created an environment where marketing feels forced to seek quick-to-deploy individual point solutions that may not effectively link to the established infrastructure or corporate strategy, and IT is often left feeling like glorified order-takers with little strategic voice,” said Neale-May.
Timing, resources and support are also key constraints to a more collaborative, fluid and profitable IT-marketing relationship, as both marketing and IT executives admit to following different schedules, priorities and paths to implementation. Further, 64 percent of marketers said implementing new solutions has been a challenge; 46 percent of marketers said marketing is not seen as a priority by the IT executives; and 44 percent of marketers said their budgets aren’t big enough to execute their plans. From the technology side, 30 percent of IT executives said they lack the time and technical resources to help marketing; 39 percent of them said that marketing bypasses them and works directly with the vendor; and 31 percent said marketers hinder progress by taking control and isolating IT from solution selection, strategy or implementation.
The study is based on a survey of 320 global marketing executives and 300 global IT and information systems executives that was conducted during June through September 2010to understand the primary challenges, market shifts and customer expectations that affect collaboration between the two groups. It examined the forces and factors galvanizing IT and marketing groups to capitalize on the profound marketing opportunity that digital technology and channels represent to companies.
An executive summary of the study and a comprehensive report — which includes summaries of 76 qualitative interviews with marketing and IT leaders, detailed findings of the online survey responses of marketing and IT executives, and contributed commentary from industry experts — is available online at http://www.cmocouncil.org/resources/form-cmocio.asp
About the CMO Council
The Chief Marketing Officer (CMO) Council is dedicated to high-level knowledge exchange, thought leadership and personal relationship building among senior corporate marketing leaders and brand decision-makers across a wide-range of global industries. The CMO Council’s 6,000 members control more than $200 billion in aggregated annual marketing expenditures and run complex, distributed marketing and sales operations worldwide. In total, the CMO Council and its strategic interest communities include over 12,000 global executives across 100 countries in multiple industries, segments and markets. Regional chapters and advisory boards are active in the Americas, Europe, Asia Pacific, Middle East and Africa. The Council’s strategic interest groups include the Coalition to Leverage and Optimize Sales Effectiveness (CLOSE), Marketing Supply Chain Institute, Customer Experience Board, LoyaltyLeaders.org, Online Marketing Performance Institute, and the Forum to Advance the Mobile Experience (FAME). www.cmocouncil.org <http://www.cmocouncil.org/>
Accenture is a global management consulting, technology services and outsourcing company, with approximately 204,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$21.6 billion for the fiscal year ended Aug. 31, 2010. Its home page is www.accenture.com.