By José de la Rubia, CEO, Quanta
This article is by Featured Blogger José de la Rubia from his LinkedIn page. Republished with the author’s permission.
Where are we up to with digital marketing transformation?
The digitalization of corporate communication is progressing. Two key features of this development are the advent of big data and the associated automation in marketing. But the main problem with this development is that marketers are marketers. They’re not data analysts.
Most people are lacking the know-how required to analyse the immense flood of data and use it for their own purposes. This is one of the key results of the 2016 European Communication Monitor (ECM), which is one of the largest corporate communication studies in the world with its comprehensive 2,700 participants from 43 countries.
A revolution driven by big data
Data is the oil of the information age. If marketers identify the appropriate data sources and insert the appropriate analytical tools, they have the opportunity to learn more about their target groups than ever before. This opens up a way to address stakeholders with precisely the content that they are currently interested in. But, according to the ECM study, this is precisely what very few marketing professionals are in a position to do. Over 70 percent of the communication professionals surveyed believe that big data is changing their profession. But only a quarter of them have actually developed an understanding of the issue. Almost half of them indicated that they lack the know-how required to analyse and use large unstructured quantities of data.
Algorithms are taking hold in marketing
A decisive factor is what the data is to be used for. Automatic adaptation or creation of targeted and situation specific approaches, campaigns or content or personalized, context related distribution of information are some of the primary uses. Digital giants such as Google, Amazon and Facebook have perfectly understood this: e.g. algorithms that analyse previous search behaviour can determine which advertising and content is displayed for a web user on Google, Amazon or Facebook. Using the appropriate tools such as Adobe or Salesforce, companies can increasingly automate data analysis and campaign control.
When it comes to this type of automated content marketing, the ECM study shows a huge gap between vision and reality. Three quarters of the respondents are happy to see communication measures optimized by search engines and social media platforms using external algorithms. But less than 30 percent actively pursue such approaches. The survey is even more surprising in light of the fact that the ECM study revealed that most marketing departments make regular use of search engine optimization, which is based on similar analyses. A study conducted by Progress has determined lacking skills and a high level of technical complexity to be reasons why the digital transformation is only progressing slowly in many companies. Only some companies have a strategy and understanding of digital transformation. Only 43 percent of small businesses see the issue as particularly important, but 56 percent of medium-sized and 67 percent of larger companies do so.
Divided perspectives of companies
There are companies that have developed a clear understanding and strategic approach to digital transformation, and which are successfully working on customer-centric change processes. But there are also many latecomers, who are just at the beginning of this development.
The primary drivers of digital transformation
The respondents indicated new business opportunities, technological developments and changes in customer requirements as the primary drivers of digital transformation in their own companies. However, development is being hampered by outdated IT structures, the existing culture of the organisation, as well as a lack of resources and knowledge. Two-thirds of those surveyed feel that they are being supported by company management. But only one-third of the companies have a digital strategy, whereas half of large high-turnover companies have one. Nevertheless, about 80 percent of the marketing and IT decision-makers are satisfied with implementation of digital business transformation.
Digital proportion rising
Digital transformation in marketing is steadily progressing and is financed by a growing proportion of the overall budget being allocated to digital outlets, which is now often in the double-digit percentage range. But a strategy is only clearly visible in less than 30 percent of the companies. The respondents see websites, dialogue marketing, trade fairs, print media and public relations as the most important factors for marketing success, whereas social media, blogs, and mobile marketing are quickly catching up. At over 40 percent, the mobile web, SEO/SEM and analytics are considered part of the toolkit along with content and database marketing.
Significant differences between IT and Marketing
Despite many similarities, marketing and IT managers see individual aspects very differently, particularly those related to digital transformation strategies. Only 27 percent of marketing decision-makers are aware of a strategy, but 42 percent of IT decision-makers are.
The majority of marketing departments leave great potential untapped. They are not taking advantage of the possibilities of big data analytics and data-driven automation. For example, fashion companies could use geotargeting to display ad banners and other campaigns based on the current weather at the shop visitor’s location and either advertise for flip-flops or raincoats. Banners that reflect the customer’s current situation are much more likely to arouse interest than more impersonal advertising that has nothing to do with the customer’s surroundings. Entire campaigns can be personalized in this way and combined with different content and imagery for specific audience segments. For Example the age, gender, location, interests or current environment of the interested party.
Originally published on LinkedIn