• April 14, 2009
  • By Jessica Tsai, Assistant Editor, CRM magazine

Marketers Need Technology to Step Up

According to a recent report by Forrester research, the marketing and technology relationship has "soured" in the last two years, after four years of gradual improvement from "dysfunctional" to "adequate" since the firm began tracking it in 2002. Despite the obvious need for a strong partnership, the two departments struggle with even the ability to communicate in a meaningful way. In fact, marketers ranked technology as among the least competent departments in their company, second only to advertising agencies. To order to make the most of customer insight and ultimately improve the customer experience, however, will require the two to overcome their differences.

Forrester surveyed 224 direct marketers during the third quarter of 2008 and classified marketers into three categories based on their relationship with their company's technology department:

  • I.T. Partners (20 percent of respondents): This group has a dedicated technology support team so it's not surprising that 72 percent of IT Partners report "strong processes and ongoing communication and coordination with technology." I.T. Partners use an average of eight technologies. Contrary to the overall vote, they actually rate technology as their most competent partner in marketing technology. Nevertheless, this group still struggles with measurement and more specifically, data quality, a problem that even the best of technology can't solve.
  • Marketing Partners (30 percent): This group typically has a dedicated marketing services team (sometimes referred to as "marketing operations" or "vendor management). Marketing Partners use an average of eight technologies but the majority, 68 percent, lead or own their marketing technology decisions (i.e., either they make the decision, or they lead a cross-functional team that makes the decision). Instead of relying on their technology department, 66 percent rely on their marketing solutions service providers. This group faces more challenges with measurement, insight, and process than IT Partners, the report states.
  • Independents (42 percent): This group has no dedicated technology resources in marketing, fulfilling requests in a one-off manner. The have the lowest marketing technology adoption with an average of six technologies overall. Only 56 percent of Independents own their technology decisions or lead cross-functional teams. They rated technology departments as their least competent partner and 69 percent prefer technology that avoids IT involvement.
  • Others (8 percent): Respondents didn't know or were unsure of what category they are.

Suresh Vittal, principal analyst at Forrester Research, asserts that the purpose of the study was not to play favorites between the IT Partners and the Marketing Partners. In fact, both methods work just as well. The objectives is that by understanding what type of operation your marketing department is in order to plan the appropriate strategy for filling in what's missing.

If you're an IT Partner, there's an emphasis on improving data quality (e.g., data sources, data selection, and segmentation) and determining what technology is needed for marketing optimization, Vittal says. If you're a Marketing Partner, then the challenges are often around capitalizing on customer insight and establishing the right metrics.

"The challenge that continues to inundate marketers-across the board-is measurement," Vittal says. "[There's] greater pressure to prove you're a responsible marketer."

It certainly doesn't help that with the rise of social media, marketers have to keep track of an influx of more data. In a separate study, "Campaign Management Needs a Reboot," Vittal touches upon the strategic imperative to incorporate social media insight into the marketing mix. "How can you ignore social media?" Vittal asks, anecdotally referring to companies who do, in fact, ignore the trend and neglect the wealth of rich data in these channels. Just by listening, marketers can develop what Vittal imagines will be a "more insightful program." Nevertheless, he does acknowledge that, at this point, measurement in this medium is "absolutely a reach."

Technology vendors are aware of the demand for more "business-user friendly" solutions that attempt to address the demand for less technology involvement. The movement toward on-demand applications is a clear indication of this trend. "I don't think IT has to be involved," Vittal says. With on-demand solutions, the goal is to improve the user interface and in turn, simplify the typical marketing responsibilities.

Instead of wasting time on grunt work, marketers can focus on business decisions, such as integrating customer insight, understanding consumer behavior, testing, and learning. Soon, Vittal expects that technology departments will be freed from maintaining day-to-day operations and more involved in the strategic process.

Independents have the weakest marketing processes and therefore, the most work to do. Attempting to acquire every marketing technology in a haphazard manner, Vittal states in the report, "will only lead to several years of software implementation chaos and a poorly integrated mess." He advises Independents to start with just one or two most need technologies to get immediate results, and overcome communication challenges via third party business analysts and technology specialists.

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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