IoT Chang­ing Busi­ness Fun­da­men­tals

In an era of con­sumer­iza­tion, it has be­come crit­i­cal for the CMO to have a deeper un­der­stand­ing of the im­pact of the con­nected con­sumer on en­ter­prise value propo­si­tions and mar­ket­ing prac­tices, says Ra­jesh Ku­mar, CMO, SAP In­dia.

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—Ra­jesh Ku­mar CMO, SAP In­dia

Voice&Data: What is the fu­ture of the CMO in a mar­ket of em­pow­ered cus­tomers, big data, and the In­ter­net of Things?

Ra­jesh Ku­mar: In a com­pet­i­tive busi­ness en­vi­ron­ment, CMOs to­day are go­ing through a rad­i­cal trans­for­ma­tion, driven by multi-chan­nel cus­tomer choices, data anal­y­sis, and mar­ket­ing tech­nol­ogy. The ac­cel­er­at­ing pace of the change is cre­at­ing a wide range of po­ten­tial new pri­or­i­ties for chief mar­keters—lead­ing change ef­forts across the whole cor­po­ra­tion, play­ing a more ac­tive role in shap­ing the com­pany’s pub­lic pro­file, help­ing to man­age com­plex­i­ties, and build­ing new ca­pa­bil­i­ties within (and even out­side of) the mar­ket­ing depart­ment. It has be­come crit­i­cal for CMOs to have a deeper un­der­stand­ing of the im­pact of the con­nected con­sumer on en­ter­prise value propo­si­tions and mar­ket­ing prac­tices.

The im­por­tance of mar­ket­ing as a strate­gic fo­cus area for the busi­ness will be such that I see the CMO emerg­ing into the bell­wether of the com­pany. Those CMOs who move from good to great will en­roll sup­port from their CIOs to use tech­nol­ogy as an en­abler in the busi­ness and stay in con­trol of the sweep­ing changes. They will take on a more sig­nif­i­cant role within the ex­ec­u­tive team as they be­come more ac­count­able for cus­tomer fac­ing ini­tia­tives. At the same time, be­ing close to the cus­tomer and al­ready hav­ing a pulse of the cus­tomer will en­able them to lever­age many op­por­tu­ni­ties for lead­er­ship within the com­pany.

Voice&Data: In 2012, Gart­ner had boldly pre­dicted that CMOs will spend more on IT than CIOs by the year 2017. From

your ex­pe­ri­ence, have you seen this shift hap­pen­ing?

Ra­jesh Ku­mar: The pre­dic­tion was based on a very sim­ple truth that a CMO can no longer del­e­gate tech­nol­ogy is­sues/ spends. The rapidly chang­ing mar­ket land­scape de­mands that they understand and em­brace tech­nol­ogy. Whether it is to con­nect with an al­ways on con­sumer who expects the same level of en­gage­ment in the off­line or on­line world or to lever­age big data for im­proved and tar­geted mar­ket­ing cam­paigns, the CMO needs to work in close con­junc­tion with the CIO to direct spends on tech­nol­ogy. So rather than a shift, I fore­see the CMO en­rolling the sup­port of the CIO to make tech­nol­ogy pur­chases and thus bol­ster­ing the over­all tech spend within a com­pany. Many com­pa­nies are also cre­at­ing the role of the Chief Dig­i­tal Of­fi­cer who prom­ises to drive the dig­i­tal agenda within an or­ga­ni­za­tion and unify mar­ket­ing and IT ef­forts of the busi­ness.

Voice&Data: What in your view, are some of the top chal­lenges for mar­keters? How can tech­nol­ogy help in solv­ing some of th­ese chal­lenges?

Ra­jesh Ku­mar: Some of the key chal­lenges CMOs face to­day where tech­nol­ogy is a great en­abler in­clude:

Man­ag­ing data for ac­tion­able in

sights: Ac­cord­ing to the Cisco Vis­ual Net­work­ing In­dex, the global IP traf­fic will reach 1 zettabyte per year in 2015. With th­ese data vol­umes plus the struc­tured data con­tained in in­ter­nal cor­po­rate sys­tems, man­ag­ing data is a huge chal­lenge for most com­pa­nies.

I’d like to give you an ex­am­ple here of Asian Paints—with a team of 1,200 sales rep­re­sen­ta­tives con­nected to a net­work of more than 40,000 deal­ers and dis­trib­u­tors who mar­ket the com­pany’s well-known brands in more than 65 coun­tries, Asian Paints was deal­ing with an ex­po­nen­tial amount of data. An­a­lyz­ing sales trends and other key per­for­mance in­di­ca­tors for such hu­mon­gous data quan­ti­ties started be­com­ing a chal­lenge with the then IT ar­chi­tec­ture, thereby greatly lim­it­ing data ac­cess, vis- ibil­ity, and us­abil­ity. This was the time when SAP’s real-time an­a­lyt­ics tool, SAP HANA, came in handy. Asian Paints lever­aged the near-line stor­age (NLS) func­tion­al­ity of SAP IQ soft­ware to store the data more af­ford­ably, en­abling real-time an­a­lyt­ics, and dra­mat­i­cally stream­lin­ing data-in­ten­sive tasks.

Log­ging onto where the cus­tomer is: Cus­tomers are in­creas­ingly mov­ing be­tween the on­line and off­line worlds. Ac­cord­ing to a study by Van­tiv, a US-based pay­ment pro­cess­ing and tech­nol­ogy provider, more than a third of cus­tomers to­day see an item in-store, com­pare prices on a mo­bile app, and then go on­line to com­plete the pur­chase. An­other half are re­search­ing and pur­chas­ing on­line and sim­ply pick­ing up the prod­uct in-store. Mar­keters to­day face the chal­lenge of log­ging onto where the cus­tomer is. Tech­nol­ogy can help mar­keters de­velop and hone their omni-chan­nel ca­pa­bil­i­ties to pro­vide a con­sis­tent ex­pe­ri­ence to cus­tomers across chan­nels.

Voice&Data: In this new era of dig­i­ti­za­tion, how has SAP po­si­tioned it­self to be more rel­e­vant to dig­i­tal mar­keters?

Ra­jesh Ku­mar: When look­ing across dig­i­tal mar­ket­ing chan­nels, the CMO in 2015 needs to have an ex­cel­lent grasp on dig­i­tal mar­ket­ing. Ad­vance­ments in mo­bile tech­nol­ogy and the pro­lif­er­a­tion of so­cial chan­nels have given con­sumers the abil­ity to con­nect and ac­cess in­for­ma­tion at any time, and their at­ten­tion is more frag­mented than ever. So it is very im­por­tant for mar­keters to have a deep un­der­stand­ing of how the cus­tomers are go­ing to con­sume me­dia.

In this era of dig­i­ti­za­tion when cus­tomers are keen to blend mul­ti­ple chan­nels, our new omni-chan­nel so­lu­tion, the hy­bris mar­ket­ing plat­form is a per­fect fit. The hy­bris mar­ket­ing plat­form pro­vides busi­nesses a com­plete vis­i­bil­ity to com­mu­ni­cate, en­gage, and do commerce with cus­tomers wher­ever they are. All large re­tail com­pa­nies are cur­rently talk­ing to us for this so­lu­tion. Re­tail gi­ant, Fu­ture Group, an­nounced its as­so­ci­a­tion with hy­bris last year in Septem­ber to con­verge its dig­i­tal and phys­i­cal chan­nels.

Voice&Data: How can mar­keters do lo­ca­tion-based mar­ket­ing with­out be­ing in­tru­sive? Can you give us some ex­am­ples?

Ra­jesh Ku­mar: I re­cently came across an ex­tremely in­ter­est­ing in­for­ma­tion with re­spect to this trend. Ac­cord­ing to a study by Ac­cen­ture, nearly two-thirds of the on­line shop­pers would trade in­creased pri­vacy for more per­son­al­ized of­fers from re­tail­ers, as long as they are given op­tions on how their per­sonal data is used. This should be the prin­ci­ple that guides most lo­ca­tion-based mar­ket­ing ini­tia­tives to­day.

Suc­cess­ful lo­ca­tion-based mar­ket­ing ini­tia­tives will be those that are able to iden­tify a real cus­tomer need at that par­tic­u­lar mo­ment and tai­lor fit a so­lu­tion that ap­peals to the cus­tomer. Take for ex­am­ple, you re­ceive a mes­sage on your mo­bile with a dis­counted of­fer from your pre­ferred brand as soon as you walk into a re­tail store you gen­er­ally fre­quent. Wouldn’t this of­fer ap­peal to you? This is pos­si­ble and can be done.

SAP has a Pre­ci­sion Re­tail­ing so­lu­tion that can help re­tail­ers cre­ate per­son­al­ized of­fers in real time by com­bin­ing the con­sumer’s shop­ping con­text and lo­ca­tion with the com­pany’s knowl­edge of the con­sumer’s pro­file, pref­er­ences, and pur­chase history along with in-store prod­uct avail­abil­ity. As you can imag­ine such lo­ca­tion-based mar­ket­ing ini­tia­tives are a win-win for both cus­tomers and mar­keters.

The CMO in 2015 needs to have an ex­cel­lent grasp on dig­i­tal mar­ket­ing.

—Ra­jesh Ku­mar CMO, SAP In­dia

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