INBOUND 2016: Sheldon Monteiro - "Rise of the CMTO"

Thank you and welcome to day three of Inbound. I should congratulate each and every one of you for making it out here by 9:15 after all the parties last night. So Inbound is a fantastic event. At which other conference do you have a new world record in terms of number of F bombs being dropped per minute? Right. Gary Vee is truly awesome, and he manages to do that at the same time as he shares so many words of true wisdom with us. One of the things that he said is that the mobile device is a new tv, and TV is now the radio. We live in interesting times. Jamal Edwards, at the age of 15, started broadcasting on YouTube after his parents gifted him a video camera. Today he has more than 600,000 followers and over 360 million views. And he's done this from his bedroom, building up SPTV from 2006. Earlier this year, Burberry changed the cadence of fashion from nine months to 10 days. Because you can buy straight from the catwalk, within 10 days of a model featuring an outfit on the catwalk, you can buy. The reinvention of the delivery of goods and services are affecting almost every industry and category. We Amazon diapers, we Uber our transportation, we Google our symptoms. But it's not just Uber and Airbnb that are transforming industries. The Swedish town of Viken, with just a population of 4,000, recently started up a convenience store that has no employees. You can buy things like bread and other essentials with just your smartphone. So the industry in terms of delivery of goods and services, completely changing all of the time. And that's a tremendous opportunity for marketers, but it's also an existential threat. So, on the one hand, an S&P 500 company staying on the S&P 500 for less than three times the amount of time that you had back in the 60s, that translates to a company leaving the S&P 500 literally every two weeks. Yes, I had to check that fact when I saw it. But it's a pretty staggering reminder of just how much companies have to be prepared to change. So what does it take to actually be prepared for the kind of disruption that we see? So, I'm Sheldon Monteiro. I'm the global CTO at Sapient Nitro, which is part of Publicis. Sapient, the digital transformation specialist with within Publicis Group. The truth is that a decade ago, I'd have been really nervous to be up here on this stage, up here on a marketing stage. Why? I started my career as a technologist, and although I've dedicated my career to building systems that surprise and delight customers that are beautiful and usable. The reality is that I used to think marketing was mysterious. Today it's no surprise to any one of us here at Inbound that marketing and technologists folks in it have to work close together. But yet, in working with dozens of brands across the industry, I found that the partnership between marketing and it is at various levels of maturity. And yet this partnership is so critical to that it often determines the difference between success or failure of the entire organization. Let's examine why we have to go back to fundamentally the beginnings of marketing itself. In 1960, Professor Jerome McCarthy proposed that the marketing mix consisted of four primary elements. Product, price, place and promotion. Everybody in this room, this is the famous four piece model of marketing which even today still endures. But the reality is that throughout marketing's history, it's been one P over all of the others. It's really been all about promotion. And Thomas Barat, arguably who created the first brand advertisement for the Pear Soap company by superimposing slogans and images of product on top of images of upwardly mobile middle class children, really sought to elevate brands through the power of story. And thus it was that marketing really was about interrupting a consumer behavior with an unrelated product or service, such as a commercial featuring talking frogs for a beer company while you're watching something else. And that's what marketing was about. But today, it's no longer sufficient to yell your brand message from every direction at consumers. It's not just that consumers can choose, it's that they have more choice. In a world where your consumer knows more about you do than your products and services, where she chooses, where and how she engages with you, and for how long you have her attention. The only way to win, the only way to survive, is to become customer obsessed. Now that's all great to stand up here and say that, but the reality is that while Econsultancy found that something like four out of five brands, a full 81% say they have a good working knowledge of their customers. The reality is that only 37% of consumers think that their favorite retailer understands them. There's a massive gap between what marketers want their brands to deliver in terms of experience and the actual experiences that consumers today receive. We all experience this as consumers, and yet as marketers, we have this disconnect. Against this backdrop, various brand studies, this one from Interbrand shows that experienced brands are the fastest growing in terms of brand value. So companies that focus on experience over communications are winning and winning in A pretty major way as far as the big brands go. Now marketers have taken note in a study, I believe this one was by the Economist Intelligence Unit, it was a study of roughly 478 marketers around the globe. They found that these marketers agree that marketing is taking the lead not just with communications but with customer experience. That data and technology are becoming central to the marketers skills portfolio and that literally four out of five marketers think that they need to restructure marketing. We need a new contract for marketing itself and what the charter of marketing is now in order to understand what that new charter is. Against the backdrop of all of this transformation we see what are the elements that we actually need to focus on as businesses and what is the charter of the marketer within that space, if you will. In our experience working with brands across industries and across the globe, we find that it comes down to really working across seven key elements. I'll walk you through what they are and we'll have a discussion around why they are important. So the first one we've talked a little bit about, to become customer obsessed you really need to move from just being customer focused to experience led to really synchronize your entire business not just in terms of a basic understanding of the customer, but really to focus on the customer journey and to orient the entire business and all of the internal processes around customer journeys. Second, marketing itself has moved from mass communications into precision marketing fueled by data, fueled by the rise of automated buying systems and exchanges. You have commerce. Commerce moving from channel LED systems where the experience is fragmented across channels into truly integrated experiences that transcend channels where a consumer can start a journey on one channel and have a seamless transition into experiences in other channels. Products and services themselves moving from point solutions through to integrated service value propositions where products themselves are API enabled and those products can be connected into service journeys that cross the customer experience. Data, we talk a lot about data at inbound. That data moving from backward looking. Let's analyze what happened in the past through to real time impact looking at very large data sets and what's happening in the real world right now today. Enterprise it itself moving from kind of waterfall industrial based development where we decided hey, we are going to implement a system, let's say it's a CRM system and it's gonna be ready by next year or several months from now through to being multi speed where we respond at the pace that our customers need us to respond and the organizations itself. Organizational transformation moving from silos within the organization that are focused on specific domain areas into collaborative ecosystems where employees span boundaries and are able to deliver on customer experience. By focusing on these seven key levers and really leveraging the technologies that are now available, from big data to wearables to the Internet of Things to cloud computing and agile methods and smartphones, really puts digital at the core and allows for reinvention of business in service of what? Of delivering on that disconnect between what consumers expect and what brands deliver. And this is the key point. It is insufficient today to yell our brand messages at consumers, but really to reinvent our organizations. Because as another thing that Gary Vee said was that it's a lot more fun to disrupt yourself than have somebody else disrupt you. Now, you might be thinking, hey, as a marketer, I can identify with two, maybe three of the items you have up here. Sure, you'll identify with marketing, you may identify with experience, or you may identify with commerce or maybe organization. But why are you talking about all of these other items up here? Let's take a look at why we need to focus on some of these other items. Let's take a look at it, for instance. Now, I'm guessing that the majority of you in this room probably won't remember this article, but anybody who works in it absolutely will. They probably have nightmares about it. In 2003, this article appeared in the Harvard Business Review and Nick Carr made the argument that it was more important for it to be good enough and cheap than it was to be first to market and best in class. And this message was taken to heart by many CEOs and CFOs. And it led to a large wave of outsourcing to the lowest cost providers, often overseas. It had some really negative side effects, like IT being treated as a commodity that you were outsourcing to the lowest cost providers. A culture of learned helplessness and plausible deniability within it. Many IT departments today still suffer from these effects. Fast forward just eight years and here we have Mark Andreessen penning an article in the Wall Street Journal talking about why software is eating the world. And his premise is that software and technology are a major force of disruption across industries. It has gone from a back office function that was all about making the sausage factory more efficient to being the primary medium of dialogue with customers, a commodity to being the primary way in which we talk with customers. That's eight years, 180 degrees. Most IT departments tend to refresh their systems once every five years, so that's less than two IT buying cycles. Now, it is struggling with this change. But it's really up to business people and marketers to stand up and talk about what needs to change, because what's at stake is really the entire business. And that's why all of those seven levers, including IT marketers, really need to care about and take ownership of what it means to the success of the business overall. Now, with this really forced marriage, if you will, between marketing and IT that is fueled by technology enabled consumers, it's no surprise that in recent years there's been much talk about the rise of the chief marketing technologist. This article appeared in 2014, late 2014 in the Harvard Business Review. And Scott Brinker and Laura McLennan proposed that this new executive is coming to prominence within the C suite, especially in large companies, but increasingly even in smaller and medium sized businesses. And they propose that CMT's chief marketing technologists are part strategist, part creative director, part technology leader and part teacher. Now, being good at any one of those disciplines is pretty hard. Being good at all of those disciplines makes you a bit of a unicorn. And in fact, a number of, a number of people actually refer to marketing technologists as unicorns for this reason. It's kind of become the spirit animal of the profession. Now what's driving that? We've talked about two of these. One, empowered consumers demanding seamless brand experiences. It's not just about your communications, it's about your communications being consistent with every touch point we have with our customers. Second, it's not just about marketing and it's not just about sales. It is about transforming the entire business for a digital world rather than digital being an adjunct. We talked about that as well. And the seven levers. And third, there is no shortage, there's no proliferation of marketing technology. There is a gentleman, the same gentleman who co authored the Harvard Business Review article on the rise of the cmd, Scott Brinker. He publishes a landscape of marketing technology vendors every year. The first year he started it was, I believe in 2011, and he had roughly around 150 vendors mocked across that landscape. This year, that landscape has over 4,500 vendors on it. Now, with that kind of proliferation in technology, we have to manage it. We have to ensure that, that the systems we build can evolve over time, that they're built in a manner that is cost effective and actually delivers on business results. So the third item, which is connected marketing technology systems, so that your CRM systems is actually talking to your commerce system and your commerce system is actually talking to your outbound campaign management Systems. These systems are built in thoughtfully organized layers and replacing the siloed systems of the past. It's the only way to really evolve them in a structured manner. So the chief marketing technologist's work focus is to change marketing customer experience and technology, including what those functions do and how they work together in terms of creating competitive advantage. Simple to say, it's actually a massive charter. Now I talked about the fact that the profession has taken on the unicorn as a spirit animal. So not a whole lot of marketing technologists actually can be found out there. The reason for that is that graduate education hasn't yet caught up with the need for this kind of hybrid professional. So at Sapient Nitro, one of the things that we've done is actually stood up our own MBA program for marketing technologists. So we take technologists, some of our best technologists from around the company, 20 of them every year, and we put them through a year long program where we work on three things. We work on their marketing and business skills. One second, we work across the board, breadth and the depth of marketing technology. But third, and perhaps most importantly, we work on their influence skills because really in order to change marketing customer experience and it, you have to influence different departments within the organization and in fact even the C suite. So by focusing on these three different areas, we actually grow our own marketing technologies. So that's one of the things that we do. And in terms of really looking for marketing technologists, it's about finding individuals that cross those areas. One of the other things that we do is we study this profession across the industry. So we've conducted two surveys, two massive surveys of practicing marketing technologists working out there in the real world in organizations. The first study was conducted, the last at the tail end of 2014, and we surveyed close to 300 marketing technologists out there in the real world. We looked at things like what are their skills, what kinds of backgrounds do they come from, what do they think is necessary for the future of marketing in terms of skill sets, in terms of what the charter of the marketing technologist is, you can download the full survey report at the link that is at the bottom of that screen. But I just want to call out a couple of the things that we found in that first survey. So one of the things that we found was that marketing technologists cluster into six different archetypes and they are neither equivalent nor interchangeable. Three of those archetypes are focused on marketing, and three of the archetypes are focused on technology. And depending upon what the needs of the organization are depends on which organize will affect what archetypes you need within your own organization. Oftentimes it might be that somebody within the marketing function can up their skills to actually grow into one of these archetypes. At other times it takes somebody from it to really cross the chasm onto the marketing side and learn enough about the marketing and business in order to fulfill a role as a marketing technologist. The second one of these studies was produced by serving the population of marketing technologists earlier this year and we published the results just yesterday. So this report, Defend, Disrupt and Transform, really looked at marketing technologists in the context of digital business transformation. All about how do you transform the entire organization to operate in a digital world rather than digital being an adjunct. Why is this important? One of the things we looked at one of the questions we asked and that's really hard to see up there, but the question up there is how important is each of the following technology skills to the future success of the marketing function within your organization? So we are really asking, hey, what do you think's important from a technology standpoint? And unsurprisingly, at the top of the list we see things like CRM, data science, website design, which is awesome. We are focused on the things that matter Today. What was really interesting is that cognitive computing and machine learning was way down that little red circle that you see out there, way down at the bottom of the list. Now in our view, that's a huge problem. Why? Sundar Pichai, obviously the CEO of the company that makes the mobile operating system that powers 9 out of 10 smartphones that are shipped today. He has a lot at stake when it comes to mobility. When you think back to what Gary Vee said, right, that our smartphones are the new television, that's absolutely true. But Sundar earlier this year just made this statement at a conference. We will move from a mobile first world to an AI and artificial intelligence first world. And this change is going to happen faster than most of us expect. Within five years at a maximum from today, every one of our jobs is in some way going to be augmented by artificial intelligence and machine learning. If we as marketers are not thinking about that change and how to apply it for competitive advantage within our organizations, we will be left behind. So my proposition to you is that marketing's ultimate charter, every one of us needs to be focused on a holistic, sustained approach to changing the brand customer relationship to make our brand messaging consistent with the experiences that our customers have with us. What's at stake? Looking back at the last eight years. Forrester Research conducts a benchmark study every year on brands that lead in customer experience versus those that lag in customer experience, and the results are pretty striking and have been consistent over the last eight years. So customer experience leaders, as measured by Forrester's ranking system, outperform the market by a full 35 points against the S&P 500. And customer experience laggards lagged the market by a full 45. Thank you.