By: Tanja Subotić Levanič, Head of Marketing Performance Division, CEE, IBM
Technological progress is disrupting the status quo and causing market uproar. The digitalization of marketing demands a change in operation: from the silo operation to engagement in multiple systems. The technology is at our fingertips – the challenge is whether people are ready for the transformation.
In today’s world, competition is unpredictable. In the digital world, new competitors are popping up every minute and from every direction, which hardly gives us time to even realize they are here. Digitalization brings new technologies, numbers and data that allow us to know the consumer in detail and/or improve our quality of life. But what about the “human factor” and the unpredictable nature of the individual? Are we prepared for that as well?
In IBM’s C-suite study, 5,247 executives from around the globe were asked what future has in store and how they plan to position their organizations in the upcoming “age of disruption”. The study revealed that success would depend both on technological factors and human potential, and everyone participating in the study agreed that technology is changing the rules of the market game.
Marketing: silo integration, new models and new speed
The study also involved 723 marketing executives, who believe we are standing on the brink of a new era. Industries are rapidly converging and new competition is developing just as fast. In the world of marketing, technology has certainly facilitated many things, but the question is: has it actually made anything easier? As revealed by the study, technology reinforced the “walled garden” silos, where each department uses its own tools to complete assignments within dispersed and new communication channels. Bringing everything together is quite a challenge. As marketing is a “team sport”, departments have to work together. Silos will not disappear by themselves, if at all. One of marketing’s crucial roles is to develop strategies and approaches that could be used to integrate individual silos.
As the study confirmed, the pace of innovation in digital technology and its use are amazing and the operation of traditional industries has thus been turned upside down. The Uber service caused a revolution among transport providers, and the Netflix business model initiated a digital transformation in the field of on-demand videos. As much as 67% of marketing executives believe business transformation to be the key current trend.
According to these executives, two of the four technologies with the greatest potential for profitability that will arrive with the next wave of changes are the internet of things and cognitive computing (besides mobile and cloud computing). Almost 70% of marketing executives plan to reconsider their strategic policies in light of technological advantages that are already changing the market.
In this regard, speed is of the essence as well – not just because of changes in themselves, but for companies to remain competitive. Almost 80% of marketing executives from the most successful companies, i.e. those described as market leaders, are focused on being among the first to break into a market, while only 46% of marketing executives from companies categorized as market followers are doing this.
Focus: better customer experience with new tools
A similar survey carried out by IDC among marketing executives from SE Europe showed that 95% of them consider customer satisfaction and experience to be their main priorities. In this regard, digital technology offers new ways of bringing customer experience to a next level or to improve business agility, capacity for innovation and quality of decision-making.
Key priorities of marketing executives: for 95% of participants from the region, customer satisfaction and experience are the main priority. Source: IDC.
Which strategies that would utilize technology in a creative and inventive manner to present customer-focused innovations to the market are at the top of priority lists for marketing executives? The first such strategy is a total experience transformation, which focuses on a multi-dimensional market approach to achieve an optimum customer experience. This is followed by Big Data as well as its collection and analysis. The third such strategy is predictive analytics, which is used to predict customer behaviour and, as a result, optimize the company’s marketing efforts at the client level.
Based on the strategies listed above, companies are able to achieve better business results and be more effective. With regard to technological development, this can be complemented by new cognitive marketing tools based on cognitive computing, which help marketers identify better opportunities to create experience tailored to specific customers. Replacing the “obsolete” customer segmentation, whose results are diminishing, the future approach will be increasingly based on a cognitive system that will be used to compare the behaviour of new customers, both known and unknown, to the behaviour of key customers. Namely, cognitive computing understands the natural language, accepts large data volumes as well as searches for connections between data series, detects patterns and gives insight, and, what is most important, learns based on people’s actions and feedback. These tools will help marketers to successfully create products and services that will be completely tailored to the values and needs of an individual.
(Still) not enough support from managements
Digital transformation can only be successful in environments that encourage and utilize digital interactions, connections, relations and tools. The mindset suitable for this is characterized by curiosity, boldness, digital experimentation, use of statistics, error management, flexibility and resourcefulness while dealing with ambiguity, rapid changes and occasionally with chaos.
In such circumstances, pronounced and continuous leadership traits are an indispensable part of transition into the era of digital marketing. But are we ready for them? It does not seem so. In the mentioned study, as much as 40% of marketing executives from SE Europe listed lack of support and commitment from the management as two main obstacles preventing them from achieving their objectives. For 43% of study participants, the lack of information needed for making decisions was another key obstacle. Data integration, which forms the basis of predictive models, is also hindered by the already mentioned organizational silos.
Research indicates that organizations favour systems that are useful today rather than those that will be useful tomorrow, and that – and this is probably an even greater problem – their corporate culture leads them to hide from the truth if the latter is outside the box. The digitalization of marketing is forcing companies to make transition from the silo operation to engagement in multiple systems. As companies face these challenges, both technology as the moving force and people, who are able to effect changes through good communication, collaboration and innovation, play crucial roles. This is the manner in which we have to operate as individuals, as employees and as a society.
When and how to begin the transition?
Today: Evaluate your understanding of client history and your methods of creating experience. Do not assume that the path of your customer has not changed in the past few years. The customer is not interested in your organization chart and is not working in the marketing field, but rather in sales, customer services etc.
Tomorrow: Consider how and when to get involved in the purchasing path of your customer and whom to connect with in order to create a better experience for your client. Opportunities for the measuring and customization in digital media indicate that we have to be able to predict which approach, i.e. digital, hybrid or traditional, will provide the best experience on a case by case basis.
Next month: Don’t walk, run. Years of experience, access to strategic budgets and marketing plans allow you to achieve the expected results. However, do not forget about the content.
The next quarter: Experiments (and mistakes) should become an integral part of your culture. The transition will not happen overnight. Set different goals on the way and constantly monitor and modify them.
