Influence of Digitalization on Marketing : Part VII (END)

The sixth part of the article on Influence of Digitalization on Marketing can be read here. Marketing controlling is a function to support the management in their decisions and to control all market-related functions and represents a sub-area of ​​the entire operational controlling. The necessity of IT systems in this area is undisputed. The general objective of marketing controlling is a selective and/or continuous analysis of the constituent elements of marketing, usually based on comparison or target values, to ensure long-term successful corporate management.

First, the marketing department has to define goals that are derived from the company’s goals. Marketing provides various strategies to achieve these goals. These in turn decide on the use of the marketing information systems. IT must be used so that marketing controlling can process information. This creates marketing information systems. The design of this is the task of marketing controlling in cooperation with IT. Digitization in marketing, and thus in marketing controlling, has changed the technical tools and the requirements for marketing controlling. Today it is no longer enough to use CRM software and Google Analytics for marketing controlling. Much more data sources have to be considered and processed. The use of CRM, ERP systems and data warehouse solutions support spreadsheet programs such as Microsoft Excel or have already replaced them. Necessary analyzes, evaluations, identification of weak points etc. are carried out with these systems. Thus the demands on data analysts have changed too. You have to be able to program, visualize and interpret economically today. Companies face considerable technical and personnel challenges in this regard. The following table shows the four phases in which IT can support marketing:

Phases	Activities
1st phase	First Dealing with administrative work – creating offers – submitting offers – evaluating sales statistics – managing prospect files
2nd phase	Support with administrative activities – Creation of presentation graphics – Carrying out statistical-mathematical data analysis – Downloading from external market databases – Carrying out EDP-supported surveys
3rd phase	Facilitate simple management tasks – Carrying out planning calculations – Budgeting – Project planning – Applying scoring models
4th phase	Development of complex task areas – Use of decision support and expert systems – Networked field service reporting systems – Application of models of market relationships and reactions – Development of comprehensive market databases

Correctly deployed IT can therefore help with the handling of marketing processes and relieve employees of complex administrative tasks. Marketing control is not limited to checking results at the end of the financial year, but should also provide marketing with creative solutions throughout.

 

Transformation of the company

 

Today, companies are faced with the challenge of managing the often structurally separated areas in a network. Last but not least, digitalization has contributed to the recognition that brand management affects much more areas than just marketing. We are in the age where knowing in real-time what the customer wants, fulfilling individual customer requirements and at any time across all channels matters. Not only the processes and response times have to be accelerated, but the entire company also has to transform itself digitally. Make it easy for the customer to reach you. Existing data are to be transformed into knowledge about the customers and the opportunities of mobile orientations are to be used. In the beginning, there is a digitization strategy. And this should come from the company and not just from the marketing department. Because it affects the entire company.

The way companies interact with their customers is currently changing fundamentally: Digital technologies such as social media, mobile apps, big data, cloud etc are revolutionizing marketing and IT strategies. Digitization initially has the greatest impact on customer relationships. However, the digital transformation of companies has to go far beyond individual projects in marketing or customer service. Business strategies and operational processes in all areas of the company must be put to the test and made sustainable. Digital technologies are moving to the centre of corporate strategy and IT is taking on a completely new role. IT must work closely with the management and all other departments, especially marketing.

Studies show that 91 per cent of IT managers see themselves as responsible for a digital strategy, but usually do not want to involve the marketing department in the strategy. On the other hand, 70 per cent of marketing managers see IT as not being able to implement a strategy and want to be involved in the digital strategy. In summary, the majority of the companies have so far only taken a little strategic approach to digitization. IT managers see themselves as the most important person responsible for the digital strategy and leave other departments outside.

 

Opportunities and Risks

 

As can already be seen from the previous discussion, digitization has and continues to have a significant impact on the field of marketing. The chances with digital channels (homepage, email, search engines, social media, etc.) to increase one’s level of awareness and to enter new markets are great, but also involve risks.

The influence of digitization on the field of marketing has resulted in customers receiving a mouthpiece through various technologies such as social media and thus having an influence on companies. With big data analyzes and social analytics, companies have the opportunity to react quickly and individually to customer requests, but often cannot link and evaluate the multitude of data correctly. Thanks to digitization, companies are transparent about their offers and prices. This gives customers a stronger market position, which can also result in uncontrolled communication effects. For many companies, the main reason not to use digital channels is data protection. Companies must deal with customer data with particular confidence so that knowledge is derived, but no data abuse is carried out. The digital channels are cheaper than the traditional marketing media, but customers sometimes feel overwhelmed by advertising. Customers therefore also develop and use technologies to protect themselves against this type of marketing (customer resistance). Consumers use pop-up blockers to avoid advertisements while surfing or filter email newsletters using the junk mail function. In the case of a feature film, the customer switches to time-shifted television and thus skips the advertising. Retailers, for example, offer an app with current offers or a shopping list on their smartphone to support their positioning as a likeable discounter. The customer’s expectations of a brand are the same both online and offline.

 

Conclusion

 

Many new marketing channels have emerged as a result of digitization. These are used by marketing to reach customers in many ways. The growing flood of advertising encounters a kind of defensive behaviour among consumers. For companies, this means more and more careful consideration of how their marketing should be carried out in order not to cause costs that would not pay off in retrospect. Using new technologies such as CRM, big data analytics or social analytics, marketing has the opportunity to obtain a lot of data about consumers. Because in the future it will primarily be a question of meeting the customer’s expectations individually. In many cases, however, there is a lack of expertise and parameters to interpret and process these meaningfully or effectively. For a company to benefit from digitization, a suitable strategy must be developed. Successful dealers can only develop and survive if data is sensibly analyzed and used and IT and marketing work more closely together.

Silo thinking should be a thing of the past. All departments must continue to grow together in the future and interact with one another across departments. This applies above all to IT and marketing, which are often not yet closely interlinked. IT is the main point of contact for marketing when it comes to automating analyzes and processes. Marketing controlling can use existing market research data and other internal databases. These databases increase in scope and quality with the ongoing IT support of the marketing processes. The analysis of the data in BI, CRM, Big Data or other sources should also result in recommendations for action for marketing. Big data in particular and the automated evaluability of this already collected amount of data will therefore play an increasingly important role in the future. Through real-time analysis and adaptation of the resulting recommendation, may customize contents for its smartphone application according to weather, location, and daytime. If it is a cloudy morning, the mobile application may automatically display hot coffee coupons to users around the city. But if it is sunny, orange juice may be a better choice for prospective customers. This exciting development and its effects will be followed up and analyzed to gradually draw new comparisons and identify trends. Besides, it is conceivable that self-learning systems play a role. These could independently project the parameters of an old campaign onto a new campaign.

Data protectionists, in particular, will appear more and more to the almost transparent consumers to protect them. It is also exciting to see how online shopping is developing. Purchasing via mobile devices such as smartphones and tablets will continue to increase and providers must make their appearance and offers suitable for smartphone use. In conclusion, it must be said that the pressure of competition is increasing. Only those who pursue a consistent e-business strategy and can retain customers across all channels will survive.

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