Externalize marketing? Why it makes business sense

Externalize marketing? Why it makes business senseMarketing has become more specialized and strategic than ever. Customers are more vocal and increasingly deal with companies on their terms; New companies can serve clients in new markets and compete with established ones more easily, and companies have an increasing range of ways to create and deliver targeted value to their clients, while precisely measuring the effects.

To thrive in this ever changing, high-stakes world, business leaders must invest in professional marketing capabilities to better serve clients and compete.

So what what does this mean for today’s technology firms?

Marketing investment is a priority in both small and large companies

According to the CMO Survey, a bi-annual opinion poll ofMarketing spend - CMO Survey 2013 senior North American marketers, despite a tough economy, over the past 2 years companies’ marketing budgets have actually grown by 2.5 pts. compared to firms’ overall budgets (Figure 1).

While many companies have significantly cut spending in traditional media advertising activities (i.e. TV, radio, print advertising, events) and to a lesser degree in online advertising, as examined in our summary of PWC’s Global CEO survey, a large majority of firms are re-allocating budgets to those activities more directly linked to revenue and profit growth:

  • Development and introduction of new products and services;
  • Management of existing customer relationships using new channels.

Furthermore, to improve and consolidate their marketing capabilities and increase competitiveness, many firms Marketing knowledge spend - CMO Survey 2013continue investing in varied forms of marketing knowledge (Figure 2).

In particular, firms expect to significantly increase spending in consulting services, in order to complement and improve their existing marketing practices and activities.

Tech firms increasingly view marketing as strategic, but need to find the best ways to invest

According to a recent report from Forrester Research on the European technology marketing practices, European tech firms are becoming more confident about their marketing, and in some cases many now view it as a strategic activity, rather than just a tactical promotional function.

In this context many European technology firms are starting to see the importance of seeking out new skills and best practices in order to improve the way they do business. For example, the outsourcing habits of French and German technology companies are catching up to North American levels.

Against this evolving landscape where marketing is critical for creating value for client and generating growth, yet where it is becoming more specialized and complex, technology companies must look for better ways to develop their marketing capabilities and know-how.

To quickly gain access to fresh-skilled marketing expertise, and new ideas and insights into today’s market, technology firms generally have two options:

  1. Hire experienced, marketing professionals to cultivate and develop the company’s marketing capabilities, from the inside-out
  2. Externalize certain initiatives to specialized marketing firms

Externalized marketing offers tech firms flexible & timely expertise for creating customer value and growth

Within companies the natural inclination is to hire marketing staff into their ranks. In many technology companies however, the importance placed on recruiting specific technical skills often come at the expense of considering people with fresh, top-rank marketing skills.

This makes it hard to identify and attract the right type of experienced marketing professionals who are able to make a real difference to the business. Fortunately, externalizing selected marketing initiatives offers a practical solution for filling the marketing expertise gap.

Externalizing selected marketing initiatives offers technology companies several benefits:

  • Timely access to expert marketing assistance and advice
  • Flexibility for trying out new, high-performance product and marketing programs
  • A way to improve the effectiveness of existing marketing investments
  • A quick and flexible way to tap into new capabilities and practices for creating new forms of value for customers and business growth, all while managing costs.

Through our experience we’ve identified 8 specific jobs-to-be-done at tech start-ups and growing businesses, where external marketing helps firms enhance their position, while delivering new customer value and growth.

Find out more in our latest white paper:  “Externalize marketing?” Why it makes business sense

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