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1/30/2013
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Why CMO Tech Spending Is Good For IT

As CMOs increase their tech spending, it's up to IT to get wise to marketing’s ways.

The Red Cross Needed Help

At the American Red Cross, much of the marketing in years past was done locally, at more than 700 chapters, with little central coordination and control. Four years ago, however, new management brought in a team from the for-profit world to build a strong headquarters-level marketing organization.

"We wanted marketing that's consolidated, powerful and breathtaking, but you don't get that when your efforts are fragmented," says Banafsheh Ghassemi, a telecom industry veteran hired as VP of marketing-eCRM and customer experience.

The Red Cross wanted consistency not only between national and chapter-based marketing, but also across channels (TV, radio, print, direct mail, Web, etc.). Consistent "omnichannel" messaging and measurement is one of the hottest priorities in marketing.

The Red Cross had a mix of manual methods, point technologies and contract relationships with agencies. It lacked a marketing management system to track campaigns and return on investment by channel; those initiatives were tracked in paper notebooks, whiteboards, spreadsheets and email messages. The charity had a Teradata data warehouse, but it lacked campaign management tools and internal know-how for marketing segmentation and targeting.

Over the last three years, the Red Cross has filled many of its marketing technology gaps. It chose Aprimo, now owned by Teradata, as its marketing management platform. The charity's brand and creative team uses the system's automated review and approval workflows to develop marketing programs. The field marketing team uses the system to collaborate with Red Cross chapters about those programs and related priorities, planning and resource allocation.

The Red Cross is now deploying Aprimo's campaign management features. That deployment was delayed for 18 months because the Red Cross learned that it needed a better handle on its data before it could do customer segmentation, testing and targeting internally. The IT team discovered that not every Red Cross line of business (disaster relief, support for military families, health and safety training, blood supply and international services) was feeding data into its Teradata data warehouse, and those that were using it weren't defining data consistently. The Red Cross ended up hiring a VP of data strategy, Disney veteran Chris Taylor, to fix the problems. Poor data quality has been the bane of business intelligence and analytics projects for decades, one reason marketing teams need to work more closely with their IT colleagues.

Another data challenge is sheer scale. "Three years ago, we didn't have the system or even the techniques in place to keep some of the data that we now know to be significant for effective targeting and segmentation," Bob Page, eBay's VP of analytics platform and delivery, said during a recent CMO Council webinar. While eBay had data on its marketing -- mostly email campaigns and keyword buys -- and the resulting transactions, it wasn't keeping behavioral data such as clickstreams and site search records.

"We knew what products customers bought when they checked out, but we didn't know how often they came to the site, how long they stayed and what they looked at before they bought," Page said. "This behavioral data helps you understand interests, impulses and motivations … but it also explodes the amount of data you have to collect."

Analytics In Demand

Most companies are reluctant to throw out marketing technologies they've already bought; they'd rather build on what they have than start over. This preference explains why IT vendors are acquiring or building out their marketing capabilities to create a suite of products. Swedish insurance company Folksam, for example, uses Infor's Epiphany CRM system. Epiphany added integration to Orbis Global's marketing resource management system last year, and then in December Infor acquired Orbis Global. Around the same time, Folksam chose to replace an aging on-premises deployment of Aprimo's software.

Folksam started deploying Orbis's software on premises in October, and it expects to have it in production by May. The deployment will address outbound telemarketing, inbound call center, direct mail and email marketing. Folksam handles Web campaigns using a separate system, and its social network activity is limited to monitoring customer comments.

"All of our monthly plans and budgets for campaigns are set up in Orbis, and the campaign leader sets up the customer offer and what kind of media we're going to use -- whether that's email or direct mail," says Staffan Magnehed, Folksam's director of CRM. "We also have to determine what the offer is going to look like, the budget, and how many different activities we'll have in a multichannel campaign."

Once the campaigns are planned and prepared in Orbis, the next steps of customer segmentation, targeting and campaign execution are handled in Epiphany's Customer Interaction Hub, which combines automation and analytics capabilities.

Banks and telecom companies in particular are getting sophisticated with their promotional offers to new customers, says Forrester's Brosnan. Those efforts might involve targeting certain customers to receive cross-sell or up-sell offers, waiting a certain amount of time and then triggering follow-up offers depending on the customer's response. Such marketing was a manual process in years past "and would have taken place at a direct marketing agency or marketing services provider like Acxiom or Experian," Brosnan says.

Now that Red Cross is on its way to resolving its data quality problems, it plans to handle customer segmentation, testing and targeting using Aprimo's campaign management tools. The Red Cross used to outsource that work to agencies. "If I can have a system in front of me that lets me play with my segmentation and do testing at my fingertips, that's a huge time savings compared to sending emails, submitting a work order and then calling to find out when that work will come back," Ghassemi says.

chart: How will you deploy new marketing automation over the next six months?

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