Disruptive Digital Technologies Shake Up the C-Suite

Online and digital advertising revenue grew to $43 billion in 2013, surpassing broadcast television for the first time in history, according to the Internet Advertising Bureau. To meet the growing demand for digital advertising, digital marketing budgets will rise by 10 percent in 2014, Gartner predicts in its "Digital Marketing Spending" report. A word of caution, though: As budgets grow, so, too, do expectations. With chief marketing officers working to determine how to use new resources, analysts worry that skill gaps in the C-suite call for new, digitally focused roles.

The tech-savvy, connected consumer is changing marketing and making the traditional marketing funnel obsolete, says Jake Sorofman, a Gartner analyst. "Consumer-brand interactions are not linear, like they used to be. Consumers are interacting with brands through a maze of different experiences and devices, like social media, mobile, and other disruptive channels. So, ideally, the person that occupies the role of the CMO should be a digital native—someone who is proficient at all of these new channels," Sorofman says.

"But that's not entirely possible, because most digital natives haven't even come of age yet," he adds.

Enter the chief marketing technologist. A new role, the chief marketing technologist is rarely a peer to the CMO. "Sometimes the chief marketing technologist is a formal role that aims to fill some of the gaps between marketing and technology arms, but often an individual might function as a growth hacker—an informal role that aligns closely with the CMO to drive digital growth," Sorofman explains.

The chief customer officer has also become a crucial supporting role, Sorofman asserts, because the individual who fills it enables the CMO to shift from traditional outbound marketing, instead becoming an inbound advocate who creates lasting engagements and draws the audience in.

"Many organizations haven't grown up yet, and are stuck in a siloed legacy setup. They're used to looking outward at customers through different channels," Sorofman says. "The chief customer officer, then, is tasked with inverting that setup, looking at customers through the lens of customers' experiences, and hiding the silos that stand in the way of meaningful interactions," he says.

Roughly 48 percent of chief customer officers report to the CMO, but some organizations place the roles on the same level.

Though disruptive technologies are having the most direct effect on the CMO, the office of the CIO has been in flux as well. In a recent survey by Constellation Research, 44 percent of participants said the number one priority for the CIO should be innovation.

In reality, however, the CIO's role is limited by constant pressure to reduce costs and stretch budgets, says Ray Wang, principal analyst at Constellation Research. Until CIOs can reduce their IT investments, he explains, the CIO will continue to play the role of the chief infrastructure officer, leaving little time—or money—to focus on innovation.

As a result, Wang also predicts that a new role—the chief digital officer—will emerge to consume the chief innovation officer and the chief intelligence officer roles.

The existing leadership structure is not effective for driving the change required to excel in the era of digital disruption, says Wang, who points out that the introduction of a chief digital officer will be needed to guide organizations through the transition.

"The rise of the chief digital officer is here. The mandate is to find and apply technology innovation that supports the business strategy or to craft new business models with emerging digital technologies," Wang wrote in a recent report. "Constellation expects organizations that embrace this approach will differentiate themselves with higher margins, greater market share, increased brand relevancy, and massive scale."

Disruptive channels and technologies aren't going anywhere, Sorofman agrees, and if companies want to "keep up with the changes happening in the way consumers are interacting with brands," he says, "they should be aware of the need for organizational changes."

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