Motorola’s recent appointment of Eduardo Conrado as its first senior vice-president of marketing and IT is being heralded as proof that the roles of chief marketing officer and chief information officer are becoming more intrinsically linked. In his new role, all marketing responsibilities, such as product marketing, brand, website development, internal and external communications, will fall under his remit—but so too does the CIO and IT department.
Conventional wisdom says technology brands have the most to gain from merging marketing and technical roles. While it is true that data storage provider NetApp and business intelligence company Sybase are combining and cross-promoting CIOs and CMOs, less technical brands are experimenting as well. For example, hospitality and entertainment company Gaylord Entertainment and oilfield services firm Baker Hughes promoted an executive from CIO to CMO and created a ‘chief technology and marketing officer’ title, respectively.
Such appointments arguably signify a tipping point between the CMO and CIO, with more brands realising that the two now need to work together much more harmoniously to deliver a competitive edge. Indeed, Ovum recently declared that marketers should no longer be just ‘creatives’, and instead they need to be a hybrid of “technician, data analyst, and strategist that can justify investment decisions to the board”.
A recent IBM report said that CMOs and CIOs are now at a “historic inflection point” and that “there’s never been a time they’ve needed each other more”, while a study by Accenture found that companies that created an alliance between marketing and IT were able to achieve better customer loyalty and unparalleled advocacy.
Adding further evidence for the need for strong CIO-CMO relationships, an event entitled ‘Marketing Technology: The Rise of CMO-CIO Alignment’ was one of the most popular segments of May’s Internet Week conference in New York.
Traditionally, CMOs have delegated digital responsibilities to a specifically appointed colleague who would have dealt with IT and CIO when necessary, concentrating instead on the more traditional elements of marketing. While in the past, the CIO often effectively acted as a supplier to the CMO, delivering against a specific brief, today it seems the relationship is based around shared business objectives prompted by the complexity and cost of managing a brand through multiple and multiplying digital channels.
“Technology is helping us a lot on many marketing projects, especially in the use of digital, and we partner with IT on these,” says Paddy Rangappa, marketing director at McDonald’s Singapore. “Other projects such as the order-taking and other IT solutions for restaurants are led by IT with input from marketing.”
The perception of roles and responsibilities is certainly advancing. According to the IBM study, the leading four drivers of change in the marketing industry are social media, data explosion, the growth of channels and devices, and the impact of new consumer buying behaviour, all areas closely connected to information and technology. Due in large part to these four areas, marketers have begun to view IT as being critical to their business success—meaning marketing and IT are inevitably converging and the two need to collaborate to perform most effectively.
As the methods for gathering customer opinions continue to evolve, the CIO will play a greater role in helping the CMO and the company move even closer to its customers. Traditionally, customers’ opinions were gained through activities such as focus groups, feedback forms and telephone interviews and this was viewed strictly as a marketing discipline.
Today, ideas for future products and services can be gained in large measure through online communities, social networks, loyalty schemes and personalised marketing.
“The focus of CMOs has shifted from marketing to segments of the population, using a ‘spray and pray’ approach that is imprecise and wasteful, both to marketing to the individual,” says Yuchun Lee, vice-president of enterprise marketing management in the industry solutions division of IBM. “As a result, CMOs are finally starting to look in-house to CIOs to get a better handle on their situation and to streamline their technology needs.”
Lee believes that this new alliance will allow CMOs and CIOs to create a ‘system of engagement”’that lets them plug into customer data, glean an understanding of each person in an unprecedented number of dimensions, and then present them with products and services “that they actually want, wherever and whenever”.
Data and digital technology lie at the heart of the increasing need for the two job functions to collaborate, however, according to Simon Sproule, CVP of global marketing communications at Nissan, data can be a liability if not managed smartly.
“Today, a CMO has more information on customers, market trends and competitors than at any time before,” he says. “The continuing and exponential growth of digital channels and the way in which stakeholders interact with a company or brand has created the need for expertise in very different areas than was needed just five or 10 years ago. This means a CMO has far more need to understand and influence IT strategy; and to be an effective partner, a CIO needs far more understanding of a CMOs strategy and objectives. One cannot be effective without the other”.
This article is from the September 2013 Campaign Asia-Pacific
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When carried out effectively though, the advantages of close collaboration can bring multiple benefits to businesses. Effective Brands director Nico Stouthart says that as well as more effective targeting, it can also result in further advantages, such as “helping to fully leverage specific ‘marketing’ and ‘information’ capabilities; the building of more meaningful relationships with their consumers; and effectively mining data will generate winning consumer insights that can fuel innovation and activation”, all of which he believes will “help brands to outperform the market they are playing in”.
Internally, having the CIO and CMO aligned as partners should speed up the decision-making process and ensure that each department has a clearer vision of the strategy and objectives of their counterparts. Not realising a partnership affects an organisation’s ability to avoid cost, reduce investments and increase revenue.
While executives in most organisations have little doubt for the need to align the two roles in a more efficient way, it is not yet a marriage made in heaven. According to a recent survey from the CMO Council, both marketing and IT departments believed they were not yet effective partners, often struggling to achieve common goals. Indeed, another survey by Accenture found that less than 10 per cent of top marketing and IT executives in Asia-Pacific believe there is enough collaboration between the two corporate functions.
IT departments often cite marketing’s tendencies to skirt around them, deploying their own systems that often do not connect to legacy infrastructures. While marketing departments point to IT’s slow timelines, reluctance to deploy and a sense that marketing was not prioritised high enough as core problems in the relationship.
Like most marriages, it’s not all plain sailing and clearly there are obstacles to overcome. Stouthart believes that “both roles very often have different agendas, while an effective relationship must be built on understanding each other’s challenges, opportunities and objectives”.
He says the three primary challenges centre around digital and social capabilities, defining the relationship and how to “connect all the big data buckets in the company”.
“A big challenge both roles face is the lack of digital and social capabilities. Both roles need to develop new capabilities but also ‘marketing’ needs to develop ‘information’ capabilities and vice versa. From an organisational point of view it is essential to define how to work together. Define roles and responsibilities, processes, tools and necessary interfaces between ‘marketing’ and ‘information’.”
And within most marriages, a balance and an understanding of each other’s strengths and weakness are key ingredients to success. “If you introduce a hierarchy to the relationship, then the partnership most likely is doomed from the start,” says Sproule. “Each side needs to work together as business partners with shared objectives. Clearly, there will be projects that require leadership from either the marketing or the IT/IS side based on subject-matter expertise. An awful amount of time is wasted in large organisations worrying about the organisation chart, when that energy should be spent on how to better serve customers and stay competitive.”
That is a view shared by Kevin Noonan, public sector research director at Ovum, who thinks that many CIOs and CMOs view each other with suspicion when they are in fact on the same side. “CMOs are sometimes seen as unfocused and not involved in the real job of IT,” he says. “CIOs are sometimes seen as unbending and excessively distracted by process and infrastructure. In reality, they could each learn a lot from each other.”
Stuart Clark, MD for Asia-Pacific at Havas Media, says CMOs with strong digital and technology backgrounds are well placed to ‘own’ this converging space as they will be able to instantly empathise with the CIO’s role. He feels many CIOs will come under pressure as “their core expertise and experience is back office, but the new role of IT is very much about integrating and innovating around customer experience, which is more front-office focused — the traditional realm of sales and marketing.”
Noonan offers this advice to the current crop of CIOs: “They need to be seen as leaders of technology-enabled change, rather than just managers of boxes and systems. CIOs who cling to the past, will risk irrelevance and the sure prospect of being subsumed into other executive roles.”
Although there is no doubt many brands are aware of the need to closer align the CMO and CIO roles and harmonise their working relationship, such processes are only just being established at most companies — in Asian and Western markets alike. “Not only in Asia, but on a global level, most organisations are still in a digital learning mode. A number of our clients are starting to [use] the data that they have available and new digital/social channels to build a more intimate relationship with their consumers,” says Stouthart. “We however see that the CMO-CIO relationship still very often is an ad-hoc one that takes place on an operational level.”
All the signs indicate the CMO-CIO affiliation is not a passing fad. According to a recent survey from Gartner, by 2017 the CMO will have greater control of the IT budget than the CIO. Lee, a clear advocate for a closer relationship between the roles, believes that by working collaboratively, the two sides have the potential to work on plans that tap into both areas of proficiency, with marketers assessing their jobs from a more technical perspective and IT from a more marketing standpoint. “Together this new ‘odd couple’ team will be called upon to introduce innovations that drive business outcomes, create return on investment and directly impact the success of the enterprise,” he says.
There are various routes to a more productive relationship. Clark notes that many companies “are meeting this challenge by creating a single leader to cover both disciplines under the designation of chief digital officer, or even something broader like chief growth officer, which combines marketing, strategy, and technology”. Accenture suggests that the CMO should morph into a ‘chief experience officer’ and that IT should be seen as a strategic partner with marketing rather than just a platform provider.
Sproule is in no doubt that companies must establish a way for CIO-CMO relationships to thrive in order for brands to do likewise: “In a world that moves as quickly as digital marketing, it will become a serious impediment to performance if the CIO and CMO are not working in complete partnership,” he says.
COMMENT Culture of experimentation valuable for both sides
Venky Balakrishnan, global VP of marketing innovation, Diageo
How closely do you work with technology companies?
It’s massively important to have a direct relationship with tech companies; many of them would call themselves our partners. One of the reasons is these [platforms] have grown so fast that staying on top of it all is a full-time job. We’ve realised that to go through the usual chain of specialists and agencies is not always the fastest way of getting things done. We’ve found the need for wholesale raising of capabilities and sometimes learning from the source is fantastic.
We’ve had a brilliant relationship in the sense that many tech companies have grown so quickly that for them it’s not just a question of understanding users, but also geographies. As they’re trying to figure out how to work with brands, we’ve given them insights into markets we’re familiar with that they aren’t. It’s a wonderful give-and-take. Sometimes we become involved with very interesting things that others are not privy to, simply because we are willing to jump in there and try it out.
Do marketers really need to become ‘tech’ people as well?
I don’t sit in the IT department; I’m still a marketer. Looking at this area with a strong leg in marketing makes it a much easier bridge to people. Translation is needed for how the tech and marketing worlds do business. The consumer is the connection. Having this within marketing is really helpful, but technology is a means to an end. Sometimes it allows a richer means to that end; if not, you realise you’re just chasing a fad. Coming at it from a consumer viewpoint really helps.
COMMENT Create strong partnerships by synchronising roles
John Mayo-Smith, EVP and chief technology officer, R/GA
Technically-minded CMOs are already major buyers of marketing-related technology, and many forward-thinking brands recognise the overlap in accountability and the need to sync the two roles. Whether leading brands fully restructure or make small course corrections, it’s clear CMOs and CIOs need to sync up.
Here are some tips for creating a strong partnership:
1. Create a common language. Consider using Socratic method programmes to help attitudinal change. Be an active listener, play back facts and feelings and use ‘if’ questions appropriately: “If we found a way to address X, is there anything else you need to move forward?”
2. Establish common incentives and goals. For example, if fast time-to-market is a critical requirement, incentivise the CIO and CMO to achieve this goal. Likewise, if system uptime is a top priority, incentivise the CMO and CIO to make it happen.
3. Measure success based on common metrics. Historically, CIO performance is measured with machine tolerance. Humanise these metrics (within reason) and integrate yardsticks such as ‘brand awareness’ into performance measurement.
4. Synchronise timeframes. CIOs often follow multiyear roadmaps while CMOs tend to be more short-term oriented. Create incentives that upend these tendencies.
5. Share responsibility for both operating and capital budgets.
6. Normalise risk profiles. The CIO and CMO should have the same appetite for risk.