Marketing
and IT – Common Problems, Shared Solutions
Which
part of the company’s organisation does this list of sentiments refer?
Most
marketers will recognise this list and identify with most of the sentiments. However,
these views will generate an equal resonance within the IT community. Both groups
are feeling misunderstood and reduced in value as members of the corporate family.
Professor
Hugh Davidson (Cranfield Business School) recently recounted how thirty years
ago he forecast that marketing would evolve to become the central driver of business.
He lamented that this has not happened and that marketing still retains a tactical
rather than strategic focus. Its continuing lack of influence is illustrated by
the fact that today only 20% of the FTSE 100 companies have a board level marketing
director.
The
IT function has not fared much better. Whilst its status was elevated during the
dot com period it is still suffering from the negative backlash that followed.
Recent research showed that only 60% of MDs believe any of their IT director’s
advice. Many companies have decided that IT is no longer a core discipline and
can be outsourced to the lowest cost provider.
It
is easy to dismiss these attitudes as resulting from the pressures of today’s
troubled business environment. The same feelings of unease are also experienced
by those working in other business disciplines, particularly Finance, HR and Sales.
Perhaps the reason why IT and Marketing feel so aggrieved is their expectation
of becoming the main catalysts for corporate change and the strategic drivers
of the business. It seems a long time ago that the new technologies were going
to re-write the rules of business and marketing was the main determinant of increasing
shareholder value.
Whatever
the reason for this state of affairs, these two groups feels their contribution
is being undervalued and their ability to shape the future diminished.
When the Marketing and IT Directors next meet, rather than commiserating with
each other they could do something positive and use their respective skills for
mutual advantage. Historically marketing and IT have not been natural allies but
this could be about to change.
What can Marketing do for IT?
The
Gartner Group (leading IT industry analysts) recently advised its clients to use
the concepts of marketing to improve the status and effectiveness of their IT
operations. They believed that IT was failing to communicate its value to those
who used its services and the decision makers who determined its future.
The
concept of creating a marketing plan for the IT function is not a new idea. Historically
the results of such ventures have at best been disappointing and often unmitigated
disasters. Rather than creating a comprehensive marketing plan, all that has emerged
has been a series one-off marketing communications or re-branding projects. Such
activities have normally been short-lived and produced little more than basic
communications materials (ie newsletters and content for the company’s Intranet).
The reaction of the ‘market’ (ie the company’s employees) to
such activities has been a cynical belief that this is no more than the IT department
attempting to justify its existence.
What
are the marketing ideas that IT should start to employ? The following is a list
of the most important concepts:
-
Market
segmentation. There are multiple categories of consumers for IT’s
services. Like any market these segments will have their own distinct characteristics.
In addition, there are IT’s ‘customers’ (ie senior management
who make the IT budgetary and priority decisions) whose requirements will be very
different from those of consumers. Like any marketing plan, the starting point
is having a clear understanding of the market’s characteristics and how
it can be segmented.
-
Product
definition. It is unlikely that IT thinks of itself as managing a portfolio
of products. At any one time there will be IT services in the definition, creation,
growth and mature phase as well as those that are being withdrawn. The techniques
that are used to manage the traditional product portfolio are equally relevant
to the services provided by IT.
-
Understanding
consumer behaviour. This is perhaps IT’s greatest weakness and
dare I say an area where most marketing departments could seek to improve. IT
must understand how the users of its services behave when adopting a new application
and what can be done to increase their satisfaction. Measuring the success of
new IT systems should give at least equal weighting to the reactions from its
users as to the system’s technical performance. If Marketing could help
engender this customer-centric mindset it would lead to incalculable benefits.
-
Pricing.
Defining the ‘price’ of IT services is a concept that is rarely employed.
This refers to much more than the simplistic ‘cross-charge’ that a
business department pays for its IT services. We all know that when we use a new
IT application it has an emotional and time ‘cost’. This is not measured
in monetary terms but in the additional time we have to commit in mastering the
application and our feeling of discomfort as we are forced to move out of our
comfort zone. This is the ‘price’ the individual has to pay. If this
concept was imbedded in IT’s thinking then it would improve the way they
packaged and sold the product’s features and benefits.
-
Post sale customer service. Excelling in the provision of post sales
support is fast becoming recognised as a key factor to improving customer loyalty.
The IT department’s analogy to post sales support is the help desk –
these are not renowned for the excellence of their service. Too often the sole
factor for judging their success is their cost per transaction rather than any
measure of customer satisfaction. Marketing should help IT understand the value
of satisfying its customers throughout the whole of the product life cycle.
This
marketing orientated approach is based on a fundamentally different philosophy
from that found in most IT departments. Rather than treating their users as being
passive recipients who have no option but to use their services they should be
treated as discriminating customers.
What
can IT do for Marketing?
I
think it is fair to say that Marketing has not been very successful in the way
it has used IT. We all know of examples of projects using CRM, digital technologies,
knowledge management and loyalty programmes failing to deliver their expected
benefits. There are complex reasons why so many of these ventures have been unsuccessful,
many of which are outside marketing’s control. However, some of the blame
is associated with marketing, in particular the slowness of it staff to acquire
the new skills these applications demand.
What
are IT’s experiences and skills that would be beneficial to marketing? The
following lists some of the factors:
-
Reskilling. Because of the fast changing nature of the technology, IT
is forever having to re-skill its staff. This is necessary to both improve their
effectiveness and to retain their loyalty. Marketing skills need to be perceived
in the same way, as a resource that must be continually renewed and extended.
-
Changing
scope of responsibilities. The success of the IT department depends on
both its technical skills and its grasp of the business applications to which
it is being applied. IT appreciates that the boundaries between itself and the
business functions are continually changing and with it the demands on the knowledge
it must acquire. For instance, I suspect you will find more IT staff that have
an understanding of marketing than vis a versa. Marketing must adopt a similar
attitude and be prepared to embrace issues that it would have historically thought
of as outside its remit (e.g. legal, regulatory, sales and IT issues). It is unclear
whether this is always understood.
-
Project
management. IT appreciates that project management is a distinct skill
that needs to be learnt and applied. As marketing projects increase in size and
complexity they demand a more professional style of management. Very few marketers
see project management as a valued skill.
-
Managing
service suppliers. Much of IT’s work is outsourced, making it very
dependent on how well it manages its third party relationships. This is reflected
in the way that 'relationship management’ is now perceived as being an important
IT skill. Marketing has historically used outsourcing for the provision of PR
and advertising and there is evidence that this will expand into other areas (e.g.
E-marketing). Marketing could learn from IT how, and how not, to achieve the best
results from coordinating and managing these resources.
-
Living
with change. The way IT is organised and managed is continually changing.
Most IT departments of today look very different from how they were structured
5 years ago. Living with change is an accepted part of the IT job and for many
the reason they work in this area. The way marketing has been structured has been
far less volatile, but this is likely to change. IT has learnt how to make continuous
change an integral and exciting part of the working environment.
The
future success of the IT and marketing functions is closely correlated. For this
reason alone they should be seeking ways of working closer together. Hopefully,
this article demonstrates there are skills and knowledge they could learn from
each other that would be to their mutual advantage.
How
far this cooperation could extend is impossible to say. Who knows, one day we
might even see a merger of the two departments and the birth of a single group
called MarkITing. Maybe that is one step too far!!
About
the Author
Dick Stroud is a CIM training course director, specialising in Internet marketing.
He also teaches at the London Business School. His consultancy helps companies
use technology to improve their marketing effectiveness. He can be contacted at
dick@internet-strategies.co.uk
