30-second summary:
COVID-19 has caused a seismic shift in digital operations and consumer behavior, leading to an acceleration in digital transformation. commerce penetration grew from 16% to 27% over an eight-week period this year, for example, fundamentally changing the way retailers sell goods.
As martech players emerge to address increased shifts to digital, companies are caught in the middle of an explosion of complexity, trying to figure out how best to leverage new technology with little time to plan.
The digital skills gap has widened with the increased rate of digital transformations. Businesses are scrambling to find talent that has experience across ad tech, martech and data..
Sales and marketing alignment has become even more important as teams balance decreasting marketing budgets and increase in pressure to deliver more sales with less to keep the business alive.
The cost of complexity is high when companies purchase technologies they don’t use, or fail to have a plan in place to create a digital transformation strategy. Our advisory board emphasized the importance of streamlining the essential pieces of digital transformation—data, platform integration, talent, and alignment of sales and marketing.
Last week we met with the ClickZ advisory board to discuss the latest trends, pain points, and predictions in digital transformation. Advisory board members include key thought leaders positioned at the forefront of marketing, advertising, and technology.
Key challenges for marketing leaders
There was unanimous consent among advisory board members about the tremendous shift that COVID has had on digital operations and consumer behavior.
For example, ecommerce penetration rate grew from 16% to 27% over an eight-week period in 2020, versus growing six to 16% over a ten-year period prior to COVID.
Source: Forbes
“This indicates seismic changes in the way consumers purchase products,” explains one of our board members. “For example, the grocery category has exploded with platforms like Instacart, Walmart Shipped, Whole Foods Online, and of course Amazon.”
The different platforms and technologies that facilitate online shopping for consumers are contributing to added confusion and complexity for retailers.
Should they sell directly on their own website or set up shop on Amazon? Where should they advertise their products (Google, Amazon, Walmart, all three)?
Another member commented, “In the midst of this explosion of retail media and the complexity of buying ads across many platforms, we’re seeing martech players emerge to try to address the confusion. We’re caught in the middle, trying to figure out how to leverage these platforms as they quickly iterate their various tools.”
From a B2B perspective, there’s been a tremendous disruption in the way organizations operate internally, with a large part of the workforce shifting to working from home. In-person events, a key lead-generation and nurturing tool for B2B marketers, were canceled at a massive scale.
“Some of the core channels that B2B marketers use to reach their audience evaporated overnight,” explained one board member. “There was a giant move to digital. Many businesses in industries like healthcare manufacturing and financial services pivoted to digital transformation much more rapidly than they’d planned.”
Digital transformation leads to digital fatigue
COVID-19 is forcing the acceleration of digital transformation and this push is leading to digital fatigue. Online-only events like virtual summits are less effective than they were at the start of the pandemic, and they tend to cast a wider net in terms of leads in the funnel.
Notes one executive, “We typically do thousands of events a year and now we’re doing zero. We cancelled our largest conference this year and we rebuilt an experience in ten weeks to engage customers digitally.”
The technology that powers these events hasn’t caught up with the growing need to support large events in an engaging way.
“From a technology perspective, the ability for platforms to enable engagement with thousands of customers or audience members just isn’t there, and I don’t think it will be for a long time,” explains the same executive.
The move online is contributing to an existing trend within marketing technology that’s now critical—how do sales and marketing teams start aligning and working more effectively together, coordinating every activity that they do for maximum effect? That’s a problem that hasn’t been solved.
The need to connect technology investments to business impact has grown during a time when budgets are tight, and the future is characterized by uncertainty.
“There’s nothing that drives efficiency like a 40% budget cut,” said one member. “The dark side of attribution is credit—using attribution to prove the value of a specific marketing investment becomes toxic quickly because you’re trying to ascribe why something succeeded back to yourself or your initiative without really understanding its impact on business.”
Another member concurred, emphasizing the data problem inherent with rapid digital transformation.
“Over the last six months, as businesses invested more in reaching out through digital channels, they quickly realized that they had a data problem. They were using third-party or second-party data sources and weren’t integrating it, so they hit a wall and the data started to fall apart.”
The advisory board members all agreed that data is a pain point connected to digital transformation, and technology is what will solve the problem of data. The questions then are: what technology and who is qualified to manage it?
One shiny object to rule them all
As martech players emerge to address the shift to digital, companies are caught in the middle of an explosion of complexity, trying to figure out how best to leverage new technology with little time to plan.
Regardless of their role or business sector, the experts we spoke cited data complexity as one of their biggest challenges.
Among the issues they need to address are data unification, onboarding new tools and technology, and the complexities inherent in implementing changes within a large organization.
“Underlying all of this are massive societal changes upending everything that we used to know about how things work,” explains one tech VP. “It’s important to stay laser focused on business impact and what is going to drive value, and not get distracted by shiny objects.”
This last point introduced another challenge that businesses face around data—the issue of privacy.
Companies have a lot of data about their customers. When they embark on the journey of unifying it under one platform, they must address ethical considerations related to privacy.
Some of the shiny objects that marketing executives are drawn to involve AI and machine learning, for example, tools that monitor the text analytics inherent within social media.
But not all AI is created equal and the leaders on our panel are tasked with discerning what tools can live up to their promise and which ones are just fluff.
On the other end of the spectrum are large organizations with Chief Digital or Technology officers who have incorporated multiple martech platforms in their tech stack.
“Many of my clients end up with a lot of big marketing costs, but the technology isn’t meeting their needs,” explained one of the advisory board members.
“They might have Eloqua, Adobe Marketing Cloud, and Pardot and are thinking of incorporating HubSpot. But what they really need to do is step back and create a customer data model, so they can benefit from these technologies.”
In short, there is no single platform or technology to rule them all—no shiny object that will fix the complexity introduced by the rapid onset of digital transformation. At least, not yet.
The master of databases
Digital transformation begets data—customer data, purchase data, competitive data, sales data, marketing data and on and on. Wrangling not just the data, but the platforms inherent in collecting, storing, managing, and unifying this data takes expertise.
That’s leading to both a trend and a pain point for marketing leaders across industry sectors and organizations.
“Businesses need data savvy people that are sitting on the cutting edge of marketing technology,” explained a member. “We need people who understand data privacy, data sources, and ad tech, but finding these people is hard. They’re in high demand right now.”
Overcoming the challenge can be difficult for large organizations who don’t have the technology infrastructure in place to manage large amounts of first-party and third-party data, stitching it together to form a complete picture of their customers. This is particularly true in retail.
“Large retailers that operate across different geographic areas have many different levels of maturity on their marketing teams, depending on where they operate,” explained one executive.
“It’s not only about finding new talent, it’s about learning how to make more decisions based on data-driven insights.”
The cost of complexity
Complexity costs money. Our advisory board emphasized a focus on simplification, on streamlining the essential pieces of digital transformation—data, platform integration, talent, and alignment of sales and marketing.
Avoid shiny objects. Don’t buy tech just because someone says you need it and don’t expect one platform or piece of tech to solve all your problems.
Understand the role of people in the process of digital transformation and get your team up to speed.
Create a digital transformation/marketing transformation/data transformation strategy. Put someone in charge of it—a champion who understands data and how to connect the dots in a way that factors privacy into the equation.
“Not only is your marketing mix scrambled,” says a member of the board, “But your talent needs to be adjusted as well. You’re not doing the same things you did in 2019 and you certainly won’t be doing the same things in 2021 that you did in 2020. This is a year of transition. It’s the year where marketing transformation has been accelerated by at least five years or more.”
The post The cost of complexity: ClickZ’s advisory board discuss the latest trends in martech appeared first on ClickZ.
Source: ClickZ
Link: The cost of complexity: ClickZ’s advisory board discuss the latest trends in martech
