The CMO is in the driving seat
Darryl Cross, VP, performance development and coaching at LexisNexis, explains how marketing has finally come to be in the driver’s seat with IT playing a supporting role
The highly educated, hard skill executive is having a hard time in recent years. Whether they are in finance, information technology or other numbers-related fields, they are starting to take a back seat to the so called soft skill executive: the Chief Marketing Officer (CMO).
How could this have happened? For decades, marketing, sales and customer experience were the lowly viewed, soft skill departments where deals were made, backs were slapped and expense accounts were bloated in the name of hitting the numbers. It was a loosely managed group of charming extroverts that relied on gut feel and relationships. Their demands for advertising, branding and entertainment were hard to justify, but they always claimed that it was part of doing business. They couldn’t prove it, but everyone else reluctantly went along.
However, it also meant that these soft skill groups were the first to be affected by cutbacks and changes. CFOs, COOs and CIOs wielded the power when tough decisions were being made because they had all the data and the tools to back their priorities over marketing.
Then something changed.
Advances in technology gave unlimited access to customers and new markets. It allowed us to track buying history, behaviour and preferences. Customers leveraged technology to have unlimited choices, information and demands for individualised experiences. These trends have regulated CIOs to the back seat as the support arm of marketing, which has emerged as the dominant force in decision making. One such example is the recently announced news that the CIO of Transport for London now reports to the CIO rather the CFO, as previously done.
Customers stand in line to get a perfect cup of coffee while checking their bank accounts and ordering a new pair of shoes simultaneously on their phones. This ability to get anything, anywhere at any time has changed all customers’ expectations across all industries.
The elimination of geographic barriers for commerce has allowed even the smallest company to have a global footprint. It also means that the local enterprise now must compete at a global level of expertise.
The CIO spent the last 15-20 years making this possible by using CRM, ERP and complex databases to record transactions, fulfill orders and restock inventory. However, they do not know what customers want next, in what form or in what manner of delivery. The CIO provided access to the global market, but now they are regulated to providing historical reports. To survive in a global economy, marketing stepped in to capitalise on this need.
Insight and Prediction
Marketing’s hard skills developed as a result of the critical need for forward thinking insights and predictions on the direction of the market and the desires of customers. Data became simply the coal to put into the furnace to turn the turbines that powered the engine of the ship. It was marketing that now sat on the bridge and determined which way to turn the wheel.
Tools such as CRM, social media and other interactive technologies may be run and managed by IT professionals, but it is marketing that determines what the trends mean.
What products and services are the most important? Is that changing? Why? What can we do about it? These are all questions that have to be answered by the use of technology paired with an understanding of the market in a sense beyond the numbers or names in a database.
Unlimited Choices and Expectations
Companies such as Amazon, Google, and Zappos have all permanently changed the perception of what “good service” and quality is. All customers expect instant access to opinions and information on their next purchase. They want to be able to service their existing accounts from anywhere. They want to be able to know they are getting the best deal for themselves even when compared to a friend using the exact same product or service.
CRM systems that leverage relationship intelligence used to be owned by IT. Since they are so critical to the acquisition and retention of customers, they are owned by marketing and managed by IT. The most successful companies are using relationship intelligence to develop the products, service offerings, tactics and strategies to deliver to the empowered customer that is used to getting exactly what they want.
For years, IT focused on building critical systems. Marketing focused on designing critical programmes to attract customers. Marketing now makes decisions based on big and accurate data, so now THEY are the hard skill department.
They have the ability to analyse, interpret and predict customers’ desires. They can manage relationships and individual preferences. They can develop intelligence to make the right call about the future. They are the key to the customer, which is the new hard skill. That absolutely puts them in charge for the foreseeable future, but let’s not forget who put them there. The entitled client did. And, they usually get what they want.