I have recently published a report and series of blog posts highlighting CMO tech spending trends in India and what these trends mean to CIOs in the country. In this post, I will touch upon the emerging marketing technology landscape as a result of rising CMO tech budgets that both provide opportunities for and pose threats to CIOs.
Our research shows that nearly 50% of Indian CMOs are in search of new suppliers with specialized technologies and processes to build new digital engagement systems, such as mobile apps, social media applications, or customer loyalty management solutions. The marketing technology landscape is rapidly increasing in complexity, which is having multiple effects (figure below):
Software players are now targeting CMOs’ tech budgets with marketing-savvy offerings. For instance, Adobe, IBM, Oracle, and salesforce.com have invested a total of more than $20 billion in marketing technology M&A over the past three years.
I’ve just published a report on CMO tech spending trends in India and what these trends mean for CIOs in the country. We found that Indian CMOs’ top two business priorities are addressing the rising expectations of customers and acquiring and retaining customers; 87% and 85%, respectively, of those we surveyed indicated that these are a critical or high priority. Interestingly, Indian CMOs’ business priorities echo those of Indian CIOs: 87% of Indian CIOs previously surveyed by Forrester cited addressing rising customer expectations as their organization’s top business priority (figure below).
Despite these common goals, our findings reveal that Indian CMOs are driving their own tech agendas by:
Accelerating the growth of their tech budgets. 62% of the Indian CMOs we surveyed plan to increase their technology budget in 2014, whereas just 41% of them actually managed to do so in 2013.
Establishing their own technology departments. Forrester estimates that 30% to 40% of CMOs in India have no working relationship with their CIOs. About 40% of marketing leaders are gravitating toward establishing a technology department within marketing.
Getting more involved in planning sourcing strategy and selecting marketing technology vendors. About half of the surveyed CMOs get involved in setting the overall sourcing strategy, aggregating demand for technology products or services, and selecting vendors to meet their requirements.
I just published a report on CMO tech spending trends in India and what these trends mean for CIOs in the country. For this report, we surveyed 101 CMOs in India to understand business and marketing priorities, marketing spending on technology, key tech management challenges, and how digital engagement is shaping marketing technology trends in the country. Key highlights from the report:
The age of the customer demands that CMOs become customer-obsessed leaders. Indian CMOs’ top two business priorities are addressing the rising expectations of customers and acquiring and retaining customers; 87% and 85%, respectively, of those we surveyed indicated that these are a critical or high priority. Focusing on customers is not new for CMOs; what has changed is the pace at which customer expectations are rising.
CMOs are responding by driving their own tech agendas. Today’s customers want faster and better service — and CMOs are looking to technology to make that possible. Sixty-two percent of the Indian CMOs we surveyed plan to increase their technology budget in 2014, whereas just 41% of them actually managed to do so in 2013. About 30% of marketing leaders are gravitating toward establishing a technology department within marketing in order to become self-sufficient. They’re investing in mobile apps, customer analytics, and are looking for new suppliers in winning digital engagement strategy.
My colleague Thomas Husson (Marketing Leadership) and I teamed up again to identify the most impactful and new mobile trends for 2014. (See the full report here.)
You might ask, "how does one decide what are going to be the big trends?" Good question. For me, there are several points of input. In 2013, I had the opportunity to interview close to 200 companies in the course of doing research for Forrester's next book, The Mobile Mind Shift, as well as for my own research. I spoke to some of the best and brightest enterprises (e.g., retailers, hotels), technology companies (e.g., sensors), and vendors in the United States, Europe, China, Australia, India, Japan, Korea, Canada, and beyond. I had the opportunity to do field research in China and Korea - to walk the streets, visit stores, observe consumers and interview executives about one of the most exciting mobile markets in the world. More than 40 of the interviews were in the exciting space of mobile health and wellness. Thomas and I surveyed several hundred mobile executives. I also collaborated with Thomas who has incredible breadth and depth of knowledge of Europe.
At a time when mobile banking and mobile payments dominate the financial news, it is easy to forget about the humble automated teller machine (ATM). Customers take them for granted, until an IT glitch prevents them from withdrawing their money, that is. Only a couple of weeks have passed since the latest media uproar caused by a computer failure at the UK’s Royal Bank of Scotland and NatWest. The Daily Mail responded immediately with an alarming title, “'Cyber Monday' computer meltdown EMPTIES customers' accounts and leaves millions unable to access cash.”
Forrester just published its “India Tech Market Outlook: 2014” report; here’s a summary. We expect the Indian economy to start recovering from the tough situation it faced in 2013. It will start picking up (albeit at a slower rate) in 2014 thanks to good monsoons, an uptick in exports due to the weakening of the rupee, and huge infrastructure projects in public transportation, housing, agriculture, and farming that we expect to take off once a new central government is in place. As a result, we’ve marginally increased our 2014 forecast from 7.4% to 8% in local currency. But the biggest threat to India’s economic outlook is political instability after the national elections, which could have a long-term economic impact.
The three most important highlights from the report:
Customer obsession will take center stage for technology spending. The increasing demands of digital customers are redefining business. Recent Forrsights data indicates that Indian CIOs’ top business priority is to address the rising expectations of customers and improve customer satisfaction; 87% consider it a high or critical priority. Business leaders want to leverage technology to better engage digitally enabled constituents, fundamentally shifting how firms interact with customers.
In the first week of December, Cisco India held its analyst summit to share its 2014 strategy. Given low market morale following the sharp decline in Cisco India’s Q1, FY 2014 revenues, the event was timed well to reinforce Cisco’s ongoing commitment to the Indian market. Amongst many forward-looking statements made at the event, one message stood out – target the rising midmarket (which Cisco defines as companies with 100-1000 employees) to drive growth in India. Following are the key initiatives that the company outlined to grow its mid-market business:
- Expanding channel network in tier 2 and 3 cities. Cisco is focusing on expanding its channel ecosystem in two ways – working with independent software vendors (ISV) to jointly develop vertical-specific solutions aligned to midmarket needs; and promote Cisco’s cloud-based offerings through hosted collaboration services (HCS) partners. This is a solid strategy given the physical proximity and influence that these local partners have on firms in smaller cities.
- Incentivizing partners and equipping them with tools to boost sales. Cisco is offering handsome incentives to its channel partners focused on midmarket. Cisco is also offering a mobile customer dashboard application to partners that provides key details regarding the account, such as organizational information, past purchase history, preferences, etc. to help ensure an effective sales engagement.
Disclaimer: I am not a political analyst, and this post is not intended to promote any political party.
December 8 was an historic day for Delhi: The Aam Aadmi Party (AAP), which arose from the anti-corruption movement of Anna Hazare a year ago, achieved a spectacular result in Delhi’s assembly elections — one far beyond anyone’s expectations. The party won 39% of the total assembly seats, sending Congress (which is India’s oldest party and had ruled Delhi for the past 15 years) plummeting to third place.
AAP’s rapid rise and strong showing highlight a fundamental shift in India’s political system toward citizen engagement and empowerment, especially in urban and semiurban areas. In particular, India’s youth are ready to take risks to realize their hopes and aspirations. About 350,000 18- and 19-year-olds have recently joined the voter rolls and saw in AAP the possibility to change the existing political system. And AAP was in tune with them, putting volunteers to work on social media platforms to connect with citizens on issues like corruption.
Indian CIOs should sit up and take heed, because just as empowered citizens can disrupt traditional politics, digitally empowered customers will disrupt businesses in every industry. Forrester calls this the age of the customer, and we define it as:
A 20-year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers.
You must prepare to deal with this disruption and understand what you must do to make your organization customer-obsessed:
India is going through a tough time: Poor policy, delayed reforms, the free fall of the rupee against major currencies, multibillion-dollar scams, and political gridlock are all negatively affecting the country’s growth. However, we anticipate the Indian economy will start picking up — albeit at a slower rate — in 2014, mainly due to good monsoons, improving exports, and huge infrastructure projects that should launch once a new central government is in place.
Consumer mobility in India and China is flowing into enterprises. Recent Forrester survey data shows that nearly three in five IT execs and technology decision-makers in these countries — 58% in India and 57% in China — plan to increase their spending on mobile software (including applications and middleware) in 2014.
India has leapfrogged Australia/New Zealand and now leads the Asia Pacific region in terms of expected mobile software spending growth. China has made the biggest move over the past year, jumping from eighth place to second.
We believe that the high growth in mobile software spending in India and China is primarily due to: