Speaking the Language of Modern Brands
It’s no secret; in the last 3 years we have seen a complete shift in the landscape of professional services. Consultancies, IT shops, and agencies have examined their ability to serve their clients and realized that they can’t go at it alone. They need each other. Nowhere is this more evident than by taking a look at the recent spending spree by leading firms and technology companies to acquire agencies. According to the research firm R3, an estimated 184 agency acquisition deals worth a total of $4.1 billion were completed in the first half of 20171. This keeps with a trend we’ve seen and there is no reason to believe it will stop in the near term.
So what’s fueling this quest for creativity amongst consultancies and technology shops? As the adage goes, just follow the money. Consultancies traditionally have played in the executive suite, side by side with the CEO for their business strategy acumen. In comparison, technology shops have hung their hat on the IT organization reporting up through the CTO/CIO. But neither of those are where the money’s being pushed.
According to Gartner, CMO budgets are on the rise for the third consecutive year and will spend more on technology than the CIO in 2017. Speaking the language of brand, creativity, and the customer is something that has long eluded the consultancies and technology shops, thus the urgent need for creative injection. The promise of the agency acquisition is for consultancies and technology shops to tap into that elusive marketing budget.
Pulling back the layer one step further, you may be asking why the CMO is becoming an ever-increasing spender of the technology budget. This can be examined through four key drivers:
1. The Always-On Customer
There was a time when advertising windows were segmented. Those windows were limited to when customers were exposed to media such as TV, billboards, radio. With the ubiquity of smartphones, those days are gone. People are glued to their media, checking Facebook, News, Snapchat, Quora, Finances on average of 46 times a day2. It is LITERALLY the first thing you do when you wake up and the last thing you do before you sleep. Thus, digital experiences are the closest thing a brand has to engage their customer 24 hours a day 7 days a week. The always-on customer is a marketer’s dream and building rich and meaningful experiences through technology is the number one priority for the CMO.
2. The Age of the Customer
Customer experience is a buzz word that needs to die. But what is here to stay is the practice of customer understanding, customer-centered design, and customer-centric decision-making. Quite simply put every organization must build a muscle for listening to what your customers are telling you and putting that into action from the top of your organization right down into the core of your operations. As we’ve seen this customer-centered transformation occur, we give rise to the importance of customer journeys, customer sentiment and the power of storytelling to evoke customer emotion. The CMO is being tasked with customer satisfaction across all channels. This level of strategy is core to a business and until the recent agency acquisitions, consultancies and technology shops have rarely been invited to the table for that essential and core strategic conversation.
3. Data-Driven Decision Making
“I went with my gut” is no longer an appropriate answer. We’ve seen data volumes and the amount of data analysis increase rapidly in recent years. Organizations are making decisions based on data, and the CMO is no different. Every customer touchpoint is being measured for engagement and conversion metrics. Each experience has an A/B test for optimization. The customer experience has become data-driven which has in turn driven CMOs to rely and trust on technology to illuminate the path. With this being considered, it’s little surprise that the agencies with an analytic approach are the ones going for top dollar.
4. Technology is Becoming Human
There are two equally provocative ways at looking at this. On one side humans are more attached to technology than ever before. We rarely allow our smartphones outside our grasp, we are perfectly comfortable with wearables hanging off of our extremities and implants are just around the corner. There is no denying that technology has attached itself to our bodies. On the other hand, we see technology beginning to impersonate human behavior. With the advances in artificial intelligence, machine learning, natural language processing and virtual reality, we are blurring the lines between people and machine. Because of the way that technology is becoming more human, it becomes increasingly important that we bring a personality, behavior and social awareness to technology. That is where art and technology blend. It is the CMO’s responsibility to bring that human aspect into the experiences that are being developed.
The shift is largely customer-driven and brands are quickly aligning themselves to meet and exceed the customer’s high expectations. The CMO is at the center of this conversation and the brands that are winning are the ones empowering that role. Just as the brands have listened and reacted to their customers, the consultancies and technology shops have as well. We are seeing a new type of consulting emerge, but the question that looms is whether or not you can merge creativity into your business or if your business needs to be built on that foundation from the beginning.