The Future of MarTech depends on CMO-CIO Relationship

As companies emerge from the pandemic, marketing and MarTech lie at the heart of the recovery. To optimize MarTech investments, marketing needs to have a very effective working relationship with IT that spans strategy, selection and management. Yet fewer than one out of four marketing organizations has such a relationship.

A new Chief Marketing Officer (CMO) Council report, produced in collaboration with KPMG LLP, entitled “Making MarTech Pay Off,” covers critical aspects of the marketing-IT relationship, how they’re structured and governed, what types of MarTech capabilities and outcomes they effectuate, and how marketers can take this relationship to the next level.

Key findings include:

•     Only 23% of companies have “very effective” CMO-CIO working relationships
•     60% of CMOs in “very effective” relationships with IT have a multi-year strategic plan for MarTech, compared to 29% of CMOs in “effective” relationships
•     CMOs in “very effective” relationships with IT use an average of two innovation techniques, compared to 1.2 for CMOs in “effective” relationships
•     65% of CMOs in “very effective” relationships with IT regularly collect and distribute MarTech KPIs with insights and recommendations, compared to 36% of CMOs in “effective” relationships
•     48% of CMOs in “very effective” relationships with IT have an equal partnership, compared to 21% of CMOs in “effective” relationships

The urgency to unearth actionable data insights and improve the customer experience through MarTech has never been greater. Much of a company’s future rests on revenue growth fueled by digital marketing and delivered by a technically savvy workforce. MarTech is fundamental to meeting both CMO and CIO objectives.

The report found that “very effective” CMO-CIO relationships produce a comprehensive and highly effective MarTech capability. This consists of planning strategically, integrating strategic considerations into tactical decision-making, solidifying strategic considerations through holistic participation in selection and management stages, and measuring performance broadly and regularly.

“CMOs in very effective relationships with IT, who get the most out of MarTech, also have the largest MarTech stacks and spend the highest percentage of their marketing budget on MarTech,” notes Donovan Neale-May, executive director of the CMO Council. “These CMOs are more likely to be responsible for digital transformation, customer experience and revenue generation — the ‘big three’ — and play a larger role in the future of the company.”

The best CMO-CIO relationships lead the charge in innovation, data-driven metrics, governance, and alignment and integration. These are often the very traits needed to enjoy a competitive advantage from MarTech, yield greater returns on investment, and provide a more satisfactory MarTech experience for employees and customers.

“The new CMO Council report shows that the majority of companies do not currently have an effective marketing – IT working relationship,” said Jason Galloway, Marketing Consulting Practice Lead, KPMG LLP. “Presently, there is an urgent need for CMOs and CIOs to closely work together to maximize the return from MarTech, leading to necessary changes in innovation, data-driven metrics, governance, and alignment and integration. By doing so, companies can yield greater returns on investment, and provide a more satisfactory MarTech experience for employees and customers.

“At KPMG, we take a holistic approach to our clients’ MarTech challenges, by building strong relationships between the CMOs and CIOs, and implementing models that encourage shared insights, planning, budgeting and innovation.”