CMOs today face a shifting landscape in terms of their roles within companies and the challenges inherent in creating better customer experiences in a multi-channeled, socially connected, data-driven world. To get a better sense of where this trend is going, I spoke with John Kennedy of IBM.
Some shy away from IBM, but throughout my Internet career, I have found them to be a loyal business partner. In 1996, for example, I partnered with “Big Blue” to create the first multimedia backend database used on the Internet. At Borders.com, we used the IBM’s infrastructure to sell books, music and video.
For our site, IBM leveraged their earlier work with Vatican Library, which houses some of Western civilization’s most ancient and precious documents. IBM technology has helped them dramatically extend library use to scholars around the globe. At the time, this collaboration was unprecedented and helped make a precious collection of medieval manuscripts accessible via the Internet
I like the fact that IBM has been using culturally significant projects to stretch the boundaries of technology for generations. My Future of Work research is as much a cultural project as it is an exercise in individuals every day experiences from from the digital trenches ™.
With this in mind, I reached out to John Kennedy, IBM’s VP of Corporate Marketing. John oversees IBM’s global branding and marketing programs. He has some good insights on the major transformation going on in the world of C-Suite members.
CMO’s: The New C-Suite Leaders with a New Set of Challenges
Kennedy explains that CMOs increasingly find themselves the C-Suite leader as they are expected to convert mountains of social data into valuable information for their companies in order to create new relationships or enhance existing ones. This places the CMO in a different role with a new set of challenges. Kennedy listed the top four:
- Managing the explosion of an overwhelming amount of data
- Navigating Social media/ Making Social Media compatible with existing technologies
- Standardizing/ Simplifying/ Managing/ Facilitating proliferation of channels and devices
- Marketing to individuals, not to broad demographics
This requires CMO teams to have better analytical and technical skills, especially when it comes to defining something as important as customer lifetime value. Companies that are in more transactional-based industries, such as banking, airlines and retail, have historically done a better job in these areas.
CMO’s can use Analytics to Reach Customers
Today’s marketers are just beginning to use analytics to answer customer specific questions while harnessing insights to drive better results. According to Kennedy, "Big Data, led by the CMO, is not only driving marketing activities, but also increasingly influencing product development, supply chain, and virtually every strategic area of an organization." Historically, some of these areas are part of the CIO’s bailiwick. We’ll discuss the significance of this below.
Kennedy has seen his clients participate more and more in content, application, and software development, leading to the rapid transfer of company’s budgets to marketing departments. Ironically, this infusion of dollars has not made it any easier to determine ROI. Roughly half of the 1,700 CMOs surveyed in an IBM study felt insufficiently prepared to provide real ROI numbers. They admitted the difficulty of proving value.
By 2017, a CMO will Influence IT Spending More Than the CIO.
As a recent Gartner report points out, this transformation will mean that by 2017 the CMO will have greater control of the IT budget than the CIO. Marketing budgets will grow 7-8 percent over the next 12 months, which is 2-3 times that of IT budgets. Despite this increased power, CMOs readily admit they lack IT skills. While 79 percent of CMOs expect high or very high levels of complexity in their jobs over the next five years, only 48 percent feel prepared to deal with it.
CIOs know their role is changing and this transformation goes beyond surrendering influence to their marketing counterparts. Kennedy states that CIOs are also "breaking through the firewall mentality of a slow approval process and realizing that securing all aspects of technology can’t keep up with the world of Facebook and Twitter.” Their priorities are changing too. According to a Fall 2011 IBM CIO Study, their main focus is business intelligence and analytics followed by mobile solutions.
CIO + CMO = The New C-Suite Power Team
Given this new realignment for both the CMO and CIO, Kennedy warns that neither can afford to go it alone or operate in separate silos. To succeed, they'll have to forge an alliance as a new C-Suite power team, who can deliver business results through innovation and efficiency.
Unfortunately, this type of collaboration is still the exception and not the rule. CMOs can re-imagine their roles with next-generation skills, expanded peer networks, and transformative tools and technologies, while CIOs can lend their expertise in enterprise IT integration and expand their horizons further outside the firewall.
The Link Between a Company's Culture and its Brand
My discussion with Kennedy also focused on how companies need to change their approach to branding. He emphasized,
Every employee impacts that brand and every action communicates something about the brand. Consumers are not making a distinction between what marketers are saying, what the brand represents to them, and what their actual experience is with a product. In the same way that marketers have more transparency and visibility to the person, markets and audiences have more transparency and visibility to the company.”
That’s to say, markets, audiences and customers can quickly see when there are gaps between what a company may promise in its brand and what they actually deliver. There can no longer be any daylight between what a brand promises and the reality becomes behind the firewall. Customers want to know how the company really operates, what the company’s practices are, and what the brand stands for.
Since customers track organizational behavior more closely than ever before, marketers realize that a brand’s image comes not only from its products or reputation but also from the culture of the company itself. Companies need to recognize the profound influence that employees have on their own brands as part of their marketing portfolio. As a result, marketers are now discussing more how a company should shape its own culture. They are leading these discussions and playing a more collaborative role in the C-Suite meetings.
Kennedy points out,
It's important that a company's character and brand come together. If there are any gaps, they will come out in the social sphere because the brand is a culmination of everyone’s behavior online -- especially in social networks. Each process of delivering a product, such as supply chain activity or how someone answers the phone at the call center, really matters."
Kennedy astutely notes that when there are gaps or inconsistencies (e.g., how people talk about the company or dissatisfied employees), this will find its way into the social sphere.
The Influence of Social Media: Customers Speak, Marketers Listen
Kennedy says social media have become a testing ground for whether marketers are keeping their promises. People turn to their Facebook friends, price-scanning apps and video downloads to voice their opinions about brands within their own groups and to the world at large.
In essence, social media has become a new channel between brands and their customers -- but one where the customers are broadcasting and the marketers are listening. In turn, brands are using social media and Big Data analytics technology to better comprehend their markets and understand customers as individuals.
Kennedy’s Recommendations for Creating an Authentic and Consistent Brand and Culture:
- Develop an acute understanding of your company’s reputation by actively listening and engaging in social media.
- Systematically close the gaps between your company’s unique character and its reality -- in all critical interactions.
- Champion tools that connect the organization and implement platforms that enable employees to delight customers.
- Ensure that systems are in place to manage the risks of being a social business.
Kennedy ended our discussion with some specific recommendations for CMOs, such as:
- Marketers need to develop greater technical expertise and analytic skills.
- Marketers need to partner with CIOs who are moving from the back office to the front office. This shift is being influenced by marketers’ increased control of budget and decisions.
- Marketers need to include CMOs in their discussions and planning to ensure consistency across the organization.
- CMOs convert mountains of data on a company’s culture. Since this can directly impact the brand, a well thought out plan needs to be in place (for building the brand).
Transcript for John Kennedy Interview
Editor's Note: This is the second in the new series by Scott K. Wilder. To read the first: