 "Rising CMO tech budgets: CIO opportunities vs. threats")
I have recently published a report and series of blog posts highlighting CMO tech spending trends in India and what these trends mean to CIOs in the country. In this post, I will touch upon the emerging marketing technology landscape as a result of rising CMO tech budgets that both provide opportunities for and pose threats to CIOs.
Our research shows that nearly 50% of Indian CMOs are in search of new suppliers with specialised technologies and processes to build new digital engagement systems, such as mobile apps, social media applications, or customer loyalty management solutions. The marketing technology landscape is rapidly increasing in complexity, which is having multiple effects (figure below):
- Software players are now targeting CMOs’ tech budgets with marketing-savvy offerings. For instance, Adobe, IBM, Oracle, and salesforce.com have invested a total of more than $20 billion in marketing technology M&A over the past three years.
- Major Indian tech services firms are also gearing up to target digital opportunities.
- Tech consulting firms are moving far beyond the CIO and into the realm of the CMO as they expand their digital portfolios. For instance, Deloitte has built its own digital marketing and creative design agency.
- Digital marketing agencies are expanding their capabilities to target increasing CMO tech budgets.
The problem here is that CMOs lack technology depth, which could lead them to rely too heavily on certain tech vendors. This could expose the firm to infrastructure-related risks, cause it to fail to comply with industry and country regulations, or create challenges in integration with back-end systems. CMOs will have to adopt a holistic approach toward
digital business - something that goes far beyond vendor selection and requires effective collaboration with the CIO.
What it means for CIOs: Develop a reputation as a dynamic marketing technology integrator
The CMO of a large airline in India told me that at present he works with 15 to 17 tech marketing vendors, from boutique shops through large companies, as he couldn’t find a single vendor that could meet his end-to-end marketing needs (or he believes that no such vendor exists). With more pure tech players moving into the marketing space, CMOs are confronted with ever more technology choices; it’s time for CIOs to step in and help. You should become a service provider to marketing - someone who orchestrates technology providers to serve marketing’s needs. As such, you will work with a wide range of partners. Traditional vendors will maintain their focus on IT service delivery, while the next generation of service providers will understand how they can better support business services. Start by building your understanding of the marketing technology vendor landscape, including digital agencies and marketing software vendors.
The author is VP and Country Manager, Forrester India.
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