Mar 14, 2017

CMO vs CIO: Who’s Responsible for Digital?

by Digital Marketing Institute

By 2019, Cisco predicts there will be there will be 3.9 billion global internet users - just over half the world’s population. As a result of this shift, organizations need to embrace the opportunities presented by new technologies in order to succeed. With digital an integral part of a company's strategy, CMOs and CIOs are now responsible for driving the digital transformation of organizations across a range of industries.

The challenge is that traditionally, these roles come from different perspectives. While in a general sense, CIOs are responsible for evaluating and implementing technological solutions, CMOs lead marketing initiatives that engage with customers and drive revenue.

The proliferation of digital has made it more necessary for these roles and perspectives to interconnect rather than work independently from one another with a view of achieving positive business outcomes. The answer? A new era of CMO and CIO collaboration that can drive revenue and digital maturity. But, before we dig any deeper, let’s look back…

The evolution of the CMO

In the 1980s, vendors like SAP and Oracle enabled CFOs to manage buyouts in a more efficient manner, outsource and work on global operations.

Roll onto the 90s: the rise of the information age saw companies such as Scopus and Vantiv help Sales Directors grow their top line.

In the noughties, Symantec and Citrix allowed CIOs to improve efficiency by consolidating and improving their IT infrastructure.

It's clear to see just how great an impact digital technology has on the development of the commercial world. Now, in the present day, it’s time for the great disruption of marketing and the decade of the CMO.

Key areas of business investment in the modern digital age

“Marketing is a technical discipline now. We have to reframe things we have been doing for 100 years.” - Doug Milliken, VP of Global Brand Development, Clovox

As technology develops, there have never been more ways to harness its power to branch out to potential prospects, increase brand awareness, and market new products.

While marketers already spend a significant amount of money on technology, by 2025 the overall spend is estimated to grow to 10% of the $1.2 trillion total marketing spend compared to just 1% today.

This colossal ten-fold jump in growth is significant and unlocks previously untapped opportunities for the CMO and CIO to collaborate and push their business forward. The main areas that companies are investing in today (and beyond) are:

CRM: In business, the customer always comes first, and today's consumers are more tech-savvy than ever. Customer relationship management software enables companies to manage and analyze customer interactions and data throughout the customer lifecycle, with the aim of improving relationships with customers, encouraging customer loyalty, and ultimately driving sales. A critical area for any business and a key area of collaboration for both technical developers and marketing experts.

Databases: Data is growing faster than ever before, and by 2020, around 1.7 megabytes of new information will be created every second for each human being on earth. Databases are vital for processing these enormous amounts of information, insights that are key to digital marketing strategies. If a database is developed in an efficient, technologically superior fashion, it will be far easier to use all available data to engage with customers and increase revenue.

Marketing automation: In an age where there are seemingly endless ways to reach out to new customers and share brand messages, product information, and company news, marketing automation software and processes are essential. There are nearly 11 times more B2B organizations using marketing automation now than in 2011 - and with so many actions to manage, its importance will just grow stronger.

Digital marketing: Of course, digital marketing is the umbrella under which all promotional based activities live - and as such it's fast becoming a technical discipline just as much as it is a creative pursuit. Companies will need to invest an incredible amount of time and money into implementing effective digital marketing strategies to ensure success, and indeed, survival. Just to reiterate its importance, over one-third of CMOs believe that digital will account for 75% of marketing spend in the next five years.

Analytics: The interpretation of statistics, insights and intricate silos of data are essential in today's fast-paced digital world, and again, investment and collaboration between the CIO and CMO would make the activity far more potent. And according to a survey from IBM, (including over 700 CMOs), one of today's top priorities is to inject data-driven insights into every marketing decision.

The importance of the customer experience

Perhaps the most important area of investment for CIOs and CMOs is the customer experience.

In today's customer-driven environment, CMOs need to engage consumers in new and innovative ways on digital platforms that are constantly evolving. Along with a mobile-first and channel agnostic approach, this necessitates a tight-knit collaboration between the marketing and IT departments to pilot or implement virtual assistants, experiment with augmented reality and microsensors, in addition to testing digital marketing hubs and real-time social listening centres.

"Customer experience is becoming a hot button -- not just for the CMO, but across the C-suite. Customers expect a consistent experience, and they expect a company to know who they are from device to device and from touch point to touch point. You can only do that with technology." - Sheryl Pattek, Analyst at Forrester Research.

To achieve such a spend on marketing, technology needs to become more integrated as CMOs need to do more with the tools available to them - and use these tools more efficiently.

In the realms of IT, the role of the CIO is becoming more and more complex as core responsibilities evolve. From migrating apps and workloads to cloud-based systems right through to keeping networks and systems secure, the CIO is also expected to play a key part in digital transformation by acquiring customers and driving revenue.

That said, it’s no surprise that 72% of CIOs admit to finding the balancing act between business innovation and operational excellence incredibly difficult. Despite this, 62% are finding their role more rewarding than previous years and acknowledge that marrying transformation and functional roles is now an essential part of their job, rather than just addressing a challenge.

Collaboration in action

As the relationship between the CIO and CMO tightens, companies are starting to show new exceptional signs of growth and increased success. Take CarMax as an example:

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Collaboration in action | CMO vs CIO: Who’s Responsible for Digital?

While once a much sought after place to buy a used vehicle, CarMax has come under pressure from the emergence of online-only startups including Vroom and Beepi. To fight against these market disruptors, CarMax’s CIO and CMO teamed up to address the company’s reliance on physical stores and reach out consumers in new and innovative ways.

The solution was to co-locate their marketing and IT staff to a digital technology centre while overhauling its website to improve inventory search capabilities and introduce a new CRM system to help sales staff access information efficiently from a host of devices. Software was also developed regularly so the company could refine products before they went into production.

This collaborative process enabled CarMax to enjoy the benefits of a company that works in harmony, a place where marketing and IT are involved in the selection, testing and delivery of the technologies required to drive the digital needs of the business.

"No CMO today can be a good marketer unless they become a good technologist." - Kathleen Schaub, IDC Vice President Research, CMO Advisory Service

In the modern world of business, there is no room for a gap between marketing and IT. As such, marketers and technical staff must work hand in hand to deliver results - and in a matter of years, the relationship will between the CMO and CIO will be so close, it will be nearly impossible to tell the roles apart.

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