As social media and digital market becomes ever more important – and somewhat challenging – to companies, a related IT buying trend is under way: Chief marketing officers, for various reasons, are seizing control of their portion of IT spending, largely to invest in CRM solutions.
Partly this is due to the rapid change in the online marketing space—companies realize they must stay on top of these technologies if they want to remain competitive; partly this is due to the brush-off marketing has historically received from internal IT.
Whatever the reason, the end result is becoming clear: this trend will be a self-reinforcing cycle. As CMOs gain more control over budgets, software companies will tailor their apps to that piece of CRM’s three-legged stool. And, conversely, as more apps are tailored to marketing, CMOs will take more control of IT spending.
Big Companies Lead the Way
This trend is already on display at one of CRM’s leading providers, Salesforce.com, according to a recent blog post on Seeking Alpha. The post noted that a key change in the cloud-based software landscape “is that more software sales are being driven by marketing, and IT spending is no longer restricted to IT departments.”
And that, the post continued, is the main reason for Salesforce.com’s entry into the marketing software space: “The company expects much of its software expenses coming from marketing departments, and the focus of this software division has been shifting from technology departments to the Chief Marketing Officer’s departments.”
In recent years, Salesforce.com has focused its significant cash hoard on acquiring marketing-related providers, such as Radian6 and Buddy Media.
Microsoft Dynamics CRM is another example of a new orientation to marketing. In its newly released upgrade, it offers a connector that allows seamless operations with MarketingPilot, which the company acquired last November. In this case, Microsoft points to the application’s management capabilities – namely that it offers integrated capabilities for marketers to streamline and automate processes as well as track spend and manage budgets.
New Digital Technologies Bewitch
The growing prominence of digital marketing in the overall marketing universe is another reason CMOs are increasingly spending larger portions of their budget on it. Fifty-five percent of marketers worldwide say they plan to increase their digital marketing budgets this year, according to a Society of Digital Agencies (SoDA) survey conducted by Econsultancy. More significantly, 39 percent of those marketers plan to increase digital spending without increasing overall marketing budgets, meaning a reallocation of funds.
Despite their increase in IT influence, experts recommend that CMOs not operate in a silo when diving into CRM solutions. They should coordinate closely with IT (for effective CRM implementation) and the chief financial officer while working to exploit the real-time data and customer insights that modern technology can deliver.