Increasingly, we are hearing from organisations that are failing to see the returns they expect from their investments in engagement technology. The global pandemic, acting as a catalyst in the surge in digital adoption, has put businesses under significant pressure to transform where and how they interact with consumers in order to remain competitive. As most of us adopt the ‘new norm’ of hybrid lifestyles, where we shift constantly between physical and digital worlds, seamless experiences have become an expectation forcing marketing leaders to rethink their interaction strategies and question how effective their technologies are in supporting them.
And demand is not the only force exacting pressure on marketing leadership but supply too. Since the beginning of the pandemic, the number of MarTech solutions has increased by 24%, with 9,932 now pitching for attention and business across the eco-system1. Wide scale digital transformation has accelerated the number of new entrants offering niche functionality and industry-specific products and services, often at lower costs than their incumbents. In particular, the significant growth of aggregators – systems that enable greater cohesion of technologies – is enabling more flexible and tailored technology stacks, providing opportunities to combine best-of-breed solutions that meet organisations’ needs more efficiently. With reports of strong performance and ROIs being touted across business networks and social platforms, it’s easy to understand why marketing leaders are putting their existing investments under the spotlight.
So, how can organisations ensure their engagement technologies are efficiently delivering value for the business and the returns they expected?
Start with a clearly articulated customer strategy. One of the most common causes of the apparent ‘failure’ of an engagement technology is the lack of, or poorly formulated, customer strategy. Even the best technologies will not deliver business value if they’re driving the wrong outcomes. Effective customer strategies start with a deep understanding of the value opportunity and dynamics of the customer base – the scale, reach, current and potential value, shared personas and behaviours, needs and interests, motivations and frustrations, and how they change over time – and clearly articulate how to unlock that value through key value drivers, the series of actions and behaviours that generate positive customer and business outcomes. These value drivers become the objectives for the design of tactical, data-driven interactions and content, the fundamental inputs engagement technology rely on. The more customer outcomes that drive positive business value, the greater the return on investment from the technologies that are enabling them.
Be aware of technology hype. When technologies make bold promises, it can be difficult to discern the hype from what is commercially viable. Many organisations get caught up in the publicity and marketplace inertia and invest in technologies before fully understanding how they will be applied and supported by the business. Any new technology should first be evaluated against a well-defined set of capability requirements that can be linked back to business objectives. This avoids scope creep and overinvestment in capabilities that are not necessary and will be underutilised or are too advanced for the business to support. Capability requirements should methodically capture not only technical business needs, but set out how the technology will be used, by whom, and which business processes it will rely on or enable. Well-crafted requirements will support a more comprehensive vendor evaluation and make it easier to delineate between solutions, which is often the biggest challenge in any vendor selection. Before committing, decision-makers should construct a sound cost-benefit analysis to fully understand the levels of risk and reward, and to validate the commercial mechanics involved in how the technology will deliver value. Examine any tolerances in assumptions, inputs, and probabilities by modelling an array of outcomes and assess the envelope in which the business is willing to operate, making sure any thresholds are valid and realistic targets.
Wrap technology in an efficient operating model. When underperforming, organisations are often quick to blame their technologies, citing gaps or limitations in capability and compatibility. While this sometimes holds true, in most cases businesses overlook how the technology is being applied, used and supported by the business. As a result, investment in engagement technology can be cyclical, with ‘rip-and-replace’ an all-too-common remedy. This behaviour consumes expensive technical and business resources, and often creates significant technical debt, including the cost of behavioural change which is routinely overlooked. But technology is not always the issue, nor the answer. For any technology to be effective, it must be supported by an efficient operating model. This means building the right competencies, content and workflows to ensure it’s being optimally applied, fully utilised and effectively governed within the business. With any operating model change, this takes time and must be carefully planned and managed. Many organisations try to do, or expect, too much too quickly from their technologies, failing to understand the organisational change that’s required or has yet to occur around it. Investing time to define and plot a realistic capability roadmap will ensure technologies are properly embedded within an organisation’s operating model, evolving over time to unlock efficiencies and drive increased return on investment.