Tech marketing: Time for renewal?
Last February, before the start of the Tech-marketers Conference (and Awards), one of the participants asked a question to the master of ceremonies who was wanting to warm up the crowd: “Why are marketing folks not treated with the same respect in a tech company as in an FMCG company?”
As I was getting ready to deliver my keynote address, the question got me thinking. In FMCG companies the marketing team is held in awe by the rest of the organisation. They are the folks who deliver the magical inputs to the success of the company. They drive new product innovation and then take the product to market. In a durable B2C company, too, they are seen as key leaders, the people who tell the rest of the company what to do.
However, in tech companies they are often seen as the people who go to events, exhibitions and trade shows. They are the people who make the product literature and the website. Their role is often seen as nothing but marketing communication. This sentiment was echoed at a webinar addressed by Ogilvy’s behaviour guru Rory Sutherland at the B2B Institute of Linkedin last month.
But why?
Tech marketing companies live or die based on their product innovations. And these are driven by the product managers who work closely with the product development teams. They are the lifeblood of the company. So while product management is seen as critical, marketing is seen as nothing more than marketing communication.
Marketing teams in tech companies have got themselves into this quagmire.
In my talk I decided to expand on a few critical areas where marketing can play a more important role. The first: Buyer Behaviour Research. When asked how much do you spend on understanding the buyer and buyer’s decision journey, not many in the room admitted to doing much buyer research. Yes, a few put up their hands but the amount they spent on research was less than 3 per cent of the overall marketing budgets. So my first suggestion to them was that they can gain a voice in the boardroom if they can become the buyer behaviour experts of the company. The product managers can continue to be the product specialists, but marketing can be the buyer experts.
The second key change they can make is to use their budgets better. I presented a case for them to allocate their budgets using the 70:20:10 formula. Spend the large part of the budget, 70 per cent, on the tried and tested marketing activities, search, email, events etcetera. Spend the next 20 per cent on somewhat new initiatives, may be content marketing, digital videos. And take the last 10 per cent and do something really different; may be an influencer campaign, or a big video film. If they do this systematically, the company will start seeing them as innovators who are trying new things out.
Finally, I spoke about the need for tech marketers to embrace experimentation. They should own experimentation in the company and not leave it to the digital or the product management teams.
Harvard Business School Professor Stefan H Thomke has been researching for many years to understand how companies conduct experiments and what they derive from them. Pharma research has always been driven by A/B testing or double-blind trials [vaccine research included]. It is well known that digitalfirst organisations like Amazon and Netflix are running experiments all the time. In his new book, Experimentation Works:the Surprising Power of Business Experiments, Thomke speaks of numerous examples drawn from a wide variety of companies that run experiments. At a talk launching the book in February 2020, he spoke about an experiment that was run by an executive at Bing (Microsoft). He changed the font size of one of the lines of the results delivered by the search engine. The company panicked when it saw the results went off the charts. It thought it was a coding error. But that one experiment delivered over $100 million in extra revenues to Microsoft.
Tech marketing can get out of the Marcom maze if it can start championing buyer behaviour research, innovation and experimentation. By adopting these three mantras, it can once again become the centrepiece in a tech organisation and not just be the emailer and event [now online] organiser.
Tech marketing can get out of the Marcom maze if it can start championing buyer behaviour research, innovation and experimentation