How digital transformation is driving change in the marketing organization

I recently watched a webinar where Scott Brinker, Co-founder, and CTO of ion Interactive and editor a chiefmartec.com discussed what he sees as the top five disruptions that are reshaping the way we think about marketing. All five are interesting to think about, but the one that I’d like to talk about is the first disruption: digital transformation.

How digital transformation is driving change in the marketing organization

Brinker sets the stage for this disruption by explaining that digital transformation is not specific to marketing. It affects the entire organization and is driving changes in many processes, products, and services. But the effect that this transformation is having on marketing is critical to understand.

Traditionally, the role of marketing was to create communications that promoted products and services. That role has changed dramatically over the last few years for many companies with the advent of the Internet and changing consumer buying behaviors. The marketing department was the first to adopt digital marketing techniques to reach prospects and customers.

Today, digital expands way beyond marketing, requiring organizations to think about how they can leverage digital to create better experiences for customers across the entire customer lifecycle, not just customer acquisition. Because it was the first out of the gate to embrace digital and work to get a better understanding of the customer, marketing leads or plays a major role in defining the entire customer experience. That means marketing has expanded into areas such as sales, support and services, and even product and service development.

This evolution of marketing into the digital world is not the same for every company. As you see on Brinker’s chart below, there are different levels of sophistication, with most, Brinker notes, falling in the middle, such as Digital Marketers:

Image from Brinker's ebook, “5 Disruptions Reshaping Marketing as We Know It

According to Brinker's ebook, Digital Transformers are changing the way businesses work, which is where we are seeing the expansion of marketing to lead customer experience strategy across the organization:

Digital is no longer a marketing wrapper. It is infused into the core of any and all businesses.

But it’s the digital natives Brinker makes a point of talking about because these companies are doing something very different in terms of driving the customer experience. Digital Natives include companies that arose out of our digital world, like Uber, Amazon, and Netflix. Companies like these approach customer experience, not from marketing, but from the product perspective, using their products to drive the experience.

With Digital Natives, the product team owns the experience, not the marketing team, and they improve that experience using marketing and product development growth hacking tactics. In these companies, marketing focuses on communications and uses a variety of tactics including content marketing.

So why is it so important to understand the Digital Natives model? Because these companies have changed the role of marketing in the organization. These companies have separated marketing and product, and it’s the product team, not the marketing team that owns and defines the customer experience. Marketing plays the role of communications.

You could say that depending on how your company started, your marketing team will play a particular role. But that’s not necessarily the case, and ‘older’ companies could look at how Digital Natives are working and take a page from their playbook. As Brinker points out, there is no right way to do it. But there are plenty of permutations along the spectrum between Marketing owing it all and owning only communications.

Two ways marketing can embrace digital transformation

In his discussion on digital transformation, Brinker points to similarities between the evolution of marketing in the organization and the evolution of IT. We have watched as IT has slowly evolved, somewhat kicking and screaming, from a centralized, authoritative department on all things technology, to one that empowers departments and teams to select and work with their technology as IT guides them.

The comparison of IT and Marketing is a good one. So here are a couple of examples I’ve seen of how IT evolved in a company I worked for, and how you could apply those approaches to Marketing.

Centralize and share marketing resources

In my IT scenario, there is a centralized IT team that supports the entire company. IT resources, whether it’s architects or developers are farmed out to different departments on a project by project basis. This centralized approach gives IT tighter control over what’s happening across the company and ensures IT resources are allocated based on priorities, capabilities and level of skill required.

In a Marketing team scenario, there would be the same centralized Marketing team that owns the customer experience and loans out Marketing resources to different departments to help with marketing-focused activities. For example, if the support team wants to develop some content around a new set of products, they could request a content marketing resource to work with them on the project.

In this model - the Marketing team is centralized but is available to work with departments on a project by project basis. This approach enables Marketing to keep a handle on the content developed across the company that is customer facing - ensuring that the company brand is cohesive regardless of what touch point the customer hits. The same approach could apply to email marketing, and personalization.

Another potential plus for this model is that Marketing could have a team of marketing technology users who could support customer-facing activities from other departments that leverage that technology. This would allow a centralization of customer data from across the organization that everyone could take advantage of.

The disadvantage of this model is similar to that of a purely centralized IT model. Resources are shared on a project by project based, as well as priority and importance of the project. But who decides which projects take priority? And if Marketing is only supporting departments on a project basis, how well do they understand what the department is trying to do overall with the CX? There’s no big picture view that looks for ways to share information, or ensure a consistent experience.

Decentralize marketing resources and support

In this IT scenario, developers were assigned to specific departments; they did not belong to a centralized IT group. These developers worked only for this department and had intimate knowledge of the systems and applications the department used. However, IT Architects belonged to a centralized IT group under the direction of a Chief Architect. Each department was then assigned an architect to work with them. This allowed the architect to gain a full understanding of the department, but to also work within the context of a bigger picture for the entire company.

So how could this apply to Marketing? It’s similar to what Brinker refers to as the democratization of marketing, where individual departments have their own resources to manage marketing and CX functions. It allows each department to take responsibility for the customer experience and provide “marketing” services that support the needs of customers.

There’s still a centralized Marketing team - responsible for the brand and communications overall, but also for monitoring, measuring and defining the customer experience. This central team would work with departments providing guidance on CX strategies to ensure they are consistently applied across the company; they would advise on best marketing technology, ensuring there is a consistent martech stack that everyone can use. Finally, they would be responsible for the customer profile, working with IT to synchronize and share customer data across the company, providing that single view of the customer.

My take

Digital transformation has affected the Marketing department greatly. It has empowered them, but it has also forced them to look inside and find a better way to work.

Above are two models a company could follow, or they could design something somewhere in between. Marketing can take its lead from the evolution of the IT organization, or it can go the route of the Digital Native and separate Marketing from ownership of the customer experience.

The idea is that marketing isn’t a standalone activity, it’s used in many different scenarios supporting the entire lifecycle of the customer. Marketing can’t own that all - it needs to collaborate and work with everyone. It may be able to lead experience, but it may need to let go of some things to do that successfully.