A Principled Approach to Digital Transformation for the Modern CMO

Effective corporate marketing can no longer be built on branding and content alone. Accurate messaging and reliable delivery to the right targets at the right time demand the skilled deployment of data, science, and technology. The endeavor to evolve marketing to incorporate these new functional skills, commonly referred to as digital transformation, shouldn’t be owned solely by the CMO, but the CMO must lead it.

Many corporate marketing programs have witnessed dramatic shifts in the CMO’s traditional jurisdiction to new functional teams under new C-suite titles such as CDO (Chief Digital Officer) or CXO (Chief Experience Officer). “Digital IT” teams — which leverage data, data science, and technology for marketing purposes — have now become such key business influencers that without strong alignment and collaboration, large enterprises put their growth strategy and transformational ambitions at risk.

Technically advanced teams now introduce tooling and programs using free-flowing, aggregated data and metadata to build digital customer experiences that are easily tracked and measured. These new digital teams have scaled quickly because the business case for more investment is relatively easy to demonstrate. 

By now, these teams and practices are so commonplace that CMOs of large enterprises will often use the term “data-driven” to describe their overall marketing strategy. 

But here is why the CMO today is in a colossal predicament: marketing is accountable for setting a vision for digital transformation, but it lacks the skills and resources to achieve this outcome on its own. The wise CMO bridges the knowledge gap by driving cross-functional alignment around practical growth strategies, not by reorganizational conquest.

A strategy that balances long-term ambitions with short-term wins aligns the business around the marketing capabilities that drive competitive advantage. A principled approach to crafting this strategy invites cross-functional participation in a series of analytical exercises. 

The CMO should consider deploying the following frameworks to empower and align marketing and Digital IT teams:

  1. Think of the end-to-end marketing operation at your business as a supply chain; let’s call this a marketing value chain.
  2. Commit your team to collaborate with Digital IT to produce a unified perspective on which technical competencies will drive the most value and which will carry the most risk.
  3. When evaluating technology vendors to meet specific needs or gaps in your marketing value chain, ensure all teams align on evaluation criteria.


Establishing the Marketing Value Chain

Marketers don’t have to be at a disadvantage when it comes to data and technology decisions. By establishing the marketing value chain for their business, they rally diverse teams around substantive priorities. 

The marketing value chain isn’t very different than an ordinary supply chain. Instead of determining needs for design, production, manufacturing, and distribution to bring products to market, the modern CMO partners with Digital IT teams to drive data availability, audience creation, content development, campaign orchestration, and analytics & insights to bring digital experiences to market continuously.

build versus buy digital transformation

To assemble and facilitate the marketing value chain, the CMO and Digital IT teams must come together to advance the technical competencies that underpin each of the five steps. 

To start, the CMO should lay their marketing value chain out and collaborate with Digital IT to identify the key technical competencies that will make each part possible. The goal is to lay out each technical competency required to activate the desired marketing value chain.

How to Determine the Priority of Your Technical Competencies

To start, the modern CMO should present the digital experiences that are the most strategic for the business. 

For example, let’s say a hypothetical enterprise aspires to produce a multi-channel coordinated campaign that makes it easy for marketers to target customers in the appropriate channel based on their cohort. 

The technical competencies critical to delivering this experience include orchestration, personalization, and optimization. As a result, the organization has determined these areas of the highest strategic value compared to other competencies such as segmentation, modeling, and content delivery.

Objectives and measurable results (e.g., increased lifetime value, increased cost-effectiveness, or quicker time to value) may guide these use cases. Marketing and Digital IT should use these measures to ensure that data and technology decisions support high-priority digital experiences.

Connecting scoring-criteria to each competency to assess strategic value is the most crucial initiative the CMO will undertake in optimizing the marketing value chain. The CMO should clearly define the use cases and outline the success criteria, while Digital IT should use their teams’ scoring to influence which technical competencies get priority.

Determining Risk Associated with Developing Your Technical Competencies

Once the strategic value is associated with technical competencies, it’s time to evaluate whether to build or buy the new technology. To do this, the CMO and Digital IT should assess the risk of each option. 

All teams involved in the marketing value chain should participate in determining risk areas and their relative importance. 

Risk-to-own criteria might include the total cost of ownership, technical debt, and time consumption. 

Risk-to-buy criteria might include the total cost of ownership, compatibility with other tools, and availability of tested solutions. 

Organizations may elect to have as many or as few criteria as they think are necessary and vote on the appropriate weights of each.

Once stakeholders from Marketing and Digital IT have completed value and risk assessments of technical competencies in the context of their priority digital experiences, a completed scorecard might look like this:

build versus buy digital transformation

Streamlining the Build vs. Buy Decision

Cross-functional scorecards are useful to the CMO because they streamline decision-making around one of the most critical and complex decisions an organization can make. The choice to build technology should not be made lightly. One should only decide to build if the strategic value is compelling, and the risk to buy is daunting.

build versus buy digital transformation

Using the Proper Evaluation Criteria to Grow

Let’s say a CMO has bought into this approach and has agreed with Digital IT to configure its core competencies with external solutions. How does one go about determining which in-market technology will meet a complex enterprise’s nebulous and evolving needs? 

Before getting into the weeds, the CMO and Digital IT must align around a handful of governing theses to guide their pursuit.


The critical criteria for technology that cross-functional teams should prioritize:

Efficiency & Accessibility 

Pursue vendor solutions that seamlessly combine multiple aspects of the marketing value chain. Use the marketing value chain to foster collaboration across Digital IT teams. 


Control of Data

Elevating flexibility as the primary criterion for data processes will encourage team members to work cross-functionally not because it’s encouraged from on high but because it flows naturally from initiatives inspired by data. 


Collaborativeness of User Workflow

New technology can’t just be an attractive user interface for a marketer alone. It needs to be a value add for Digital IT teams by connecting into their workflows. 


Enablement of Homegrown Investments

New technology should not only introduce new capabilities for immediate use but promote in-house capabilities already in development. This should be an off-the-shelf requirement from a vendor solution because Digital IT teams want extensible platforms that can be built upon and can integrate with other pre-existing systems.


Mitigation of Vendor Lock-in Risk

New technology shouldn’t create dependence or commitment to a marketing cloud stack as a prerequisite for success. Seek out tools that integrate with everything and boast a compelling business case. The former will provide ongoing flexibility to mix and match capabilities; the latter adds long-term value without creating dependency on outside solutions.


Quality of Vendor Customer Success Team

New technology providers should offer talented resources that are affordable and available to train users of any functional or technical orientation.

 

In conclusion, digital transformation elevates both Marketing and Digital IT teams by using their competitive advantages to increase marketing efficacy. Only a strong partnership can enable the cross-functional teams required for digital marketing to make key technology decisions to lead the transformation effort. Many large enterprises stall in their digital transformation journey simply because they devote Digital IT resources to the wrong competencies and activities. 

The modern CMO can drive leadership in this process by communicating a clear vision, assembling the marketing value chain, and partnering with Digital IT to co-determine which marketing technology truly supports the enterprise’s primary digital experiences.

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