The Red Herring of Marketing’s ‘Digital Transformation’
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Marketers are no longer just marketers. They're “digital marketers” with fancy, techno-age buzzwords festooning their LinkedIn profiles and resumes.
One of the key takeaways from November's ITSMA Marketing Vision 2016 in Cambridge, Massachusetts, however, was that “digital” isn't everything – and has come to be a relatively meaningless term. At the end of the day, the marketer's job is still marketing – and the old marketing wisdom can be just as relevant as the new.
Connect the Dots between Old and New
“We got the ‘digital natives,' and we got the traditional people over here who got to be very successful – I call them the Luddites – and the problem is: How do you get those two groups to work together?” said Saul Berman, vice president and global chief strategist at IBM Global Business Services, during his keynote presentation, “Digital Reinvention and the New Customer Experience.” He added, “[Traditional] experience is not a bad thing – but it's a bad thing if you can only see it in the way you saw it in the past. So a lot of what I'm about is reconnecting the dots. Take the dots from your experience, take some of the new dots, and see how they connect.”
When asked, about half of Berman's sizeable audience (nearly all marketers or people closely aligned with marketing functions) indicated that they considered themselves “digital authorities” within their respective companies. Appropriately, Berman's talk focused on seamlessly moving between the “digital” world and the “traditional” world – without getting too wrapped up in either one, so as to avoid “unintended consequences.” (Berman's example on this point: An apocryphal tale of an Amazon drone completing a delivery of cupcakes by leaving the package in the customer's backyard, near the customer's dog – who promptly ate them.)
“I call [this] ‘digital reinvention.' Not ‘digitization,' not ‘digital transformation,' but something bigger and more important than that,” said Berman. “Historically, a third of your people will get it, a third … will change, a third will never get it.”
Stop Transforming; Start Inventing – and Reinventing
This distinction between digital transformation and digital reinvention, argued Berman, is that – whereas transformation implies doing the same thing in a new way, reinvention requires transitioning to a fundamentally new line of business. This reinvention thereby allows legacy businesses to compete toe-to-toe with rapidly growing digital-platform companies that earned their success from the start by purveying what their own users or customers supply (e.g., Airbnb, Uber, Facebook, Alibaba, and more).
“Transforming the way you do … the same thing is not going to defend you from these kinds of businesses,” said Berman. “It's really about what you do with those technologies. It's not about the technologies.”
Helping to set the tone for the conference, Berman was not the only one to evangelize this message.
“‘Digital' is the most overused … word today,” said Mani Dasgupta, CMO of Capgemini‘s North American region, in a later presentation, “Digital Makes Marketing Agile.” Dasgupta added, “We have all these different channels at our fingertips … Think about all these companies that also have these channels to influence us as a consumer.”
“You need to change your strategy, you need to change your operations, you need to change your technology,” said Berman, comparing the example of legacy record companies' losing litigious strategies with that of Apple's highly profitable music platform via it's iPod and iPhone products. “It's about figuring out how to monetize what people want to do instead of trying to prevent them from what they want to do.”
Knowledge Is Digital Power
Of course, this necessarily entails analyzing and learning what customers, users, and prospects are actually doing. This, in turn, requires the two fundamental keys to traditional, pre-digital marketing: product knowledge and customer knowledge. Jeff Kaplan, managing director of digital-transformation and cloud-computing consultancy THINKstrategies, tied this message to the idea that digital marketing really just means better data – and using data better – as he facilitated a marketing-practitioner panel session titled “Marketing Priorities for the Connected World.”
“If you don't understand the behavior of what you're selling and the person who's using it, you're not gonna be in business very long,” observed Kaplan. “One of the problems with this ‘[as-a-]service' idea is most people think about it as, ‘Oh, it's software as a service,' or, ‘It's this as a service.' No. It's a service that happens to be selling that.”
“I do believe that our role [as marketers] is to precisely orchestrate [digital] transformation in a way that will engage with the customer, putting the customer at the center, getting this insight in order to guide the [company's] direction,” said Kaplan panelist Ali Hoballah, Microsoft‘s general manager of worldwide enterprise services and solutions marketing. “It starts when the customer starts engaging with the product.”
“It just amazes me how many SaaS companies – cloud companies – think they can succeed long term without looking at the data [or] how their devices are actually being used,” added Kaplan. “[Companies are] able to see every keystroke, every movement.”
It's Not about the Data
“Data is not information,” said Berman. “The problem is not data. The problem is getting access to the data, and getting insight out of the data, and getting the predictive insights of value.”
(IBMer Berman went on to note winkingly that “that's why we have Watson – to tell us which information is valuable.”)
“It's not the clicks that you get. It's important to align the clicks that you get to the engagement that you get, to … the actual sales that are happening,” pointed out Dasgupta on these contextual aspects. To this end, Dasgupta went on to urge her audience always to be considering the marketing god of old, ROI – asking “What's the real cost and the real value of that click?”
Fundamentally, however, all of the conference's speakers seemed to agree that context and customer insight require boots on the ground – even if it's digital ground.
“We have to talk with our clients or customers more often,” summed up Berman. “People are still important, and the non-digital world is still important – because people expect to go between those two worlds.”
Joe Stanganelli, principal of Beacon Hill Law, is a Boston-based attorney, corporate communications and data privacy consultant, writer, speaker and bridge player. Follow him on Twitter at @JoeStanganelli.
