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Why Marketing and IT should be Very Close Friends

By Mike Linton, CMO, Farmers Insurance Group

Mike Linton, CMO, Farmers Insurance Group

It’s no secret that there has been dramatic change to business and most functional areas given the rise of analytics, the cloud and big data, but I would opine that two of the functions under some of the greatest pressure to constantly evolve are Marketing and IT. That’s due to two key factors. First, the number of marketing tools has exploded with the digital/mobile/social revolution and shows no sign of slowing. Every week delivers a new way of reaching, measuring or understanding your customer. Second, almost every one of these tools requires corresponding IT systems and capabilities to work. Our belief is that IT and Marketing should be joined at the hip so their combined efforts can have the most impact in what is a Darwinian race to apply these new capabilities in the marketplace.

"Our belief is that IT and Marketing should be joined at the hip so their combined efforts can have the most impact in what is a Darwinian race to apply these new capabilities in the marketplace"

At Farmers, we have an IT-Marketing partnership which includes a joint budget, shared roadmap and shared objectives. The teams often co-locate and data is shared liberally across the functions. Both teams share learning’s, consumer research and financial results in real time and capital requests are presented by one combined group. The teams are jointly responsible for all of the digital work, data management and a number of marketing projects. The CIO and I jointly make roadmap and key implementation decisions. Our design is based on the following principles:

1) Effectiveness - The Technology matters most when it reaches the consumer. We believe that IT and Marketing, working together starting with the design phase of any new capability, (e.g. mobile, data warehouse, CRM delivery, etc.) have a much better chance of getting it right than if marketing simply calls up and places an order to the IT team and awaits delivery. We think a deep and shared understanding of marketplace objectives, consumer behavior and expected financial outcomes all viewed through a shared budget and roadmap will yield more successful implementations and quicker fixes than each function operating independently. Probably the best example of this is the 3-year improvement for farmers.com (over a 50 point increase in transactional net promoter score) once this operating model was implemented.

2) Speed - The amount of new tools available to use and the speed at which opportunities and problems can arise is blinding. The marketplace rewards consistent strategy delivered and coordinated across all touch points (digital, broadcast media, sales, etc.), speed of testing, rapid addressing of consumer concerns and the ability to see marketplace results through numerous lenses as fast as possible. Connected teams operate better in this environment than separate teams. For example, social media or the service centers may be the first to see a customer issue. Resolving that issue is much easier if teams are hard-wired to share across functions versus up one silo and down another. Do you really want your social media team sending an issue up the marketing chain to the CMO, who then calls the CIO to work on resolution, or would you like the team to immediately and concurrently share the information with the key folks who can fix the problem? A single team with a shared roadmap and marketplace outcomes is much more likely to solve the issue than two teams operating under different objectives.

3) Big Data - Big data is a great concept, but is somewhat meaningless unless it is operationalized to deliver the company strategy and specific business objectives. We try not to talk too much about “big data and the cloud” in abstract terms (even though it can sound kind of cool) since our customers don’t buy big data or the cloud. They buy products and services driven by capabilities which can be delivered faster and better by big data applied to real issues. The best example for this is how the teams are jointly designing, building and using our master data management effort. There is a long-term roadmap for creating and designing the capability coupled with financials and the expected customer and company use cases and applications which the teams have jointly developed.

4) Customer Experience - While this is the last call out, we believe it is the most important. Customers don’t see functions; they see services, brands and products. A great marketing strategy or ad campaign which drives consumers to the brand is ineffective if the brand doesn’t deliver on the experience. Our belief is that the combination of IT and Marketing is better able to see the end-to-end consumer journey than either function would see alone. To back up our belief, both teams (and in fact the entire company) have a significant portion of their compensation tied to the customer experience. This reduces the idea that any issue is “another function’s problem” and creates a sense of ownership across the entire enterprise to contribute to the solution.

Clearly, both the Farmers Marketing and IT functions have many important and close relationships around the entire company and our partnership is not designed to be exclusionary in any way. It is, in fact, designed to maximize the marketplace impact of technology and data in a way that benefits the end customer versus either function.