As the National Retail Federation (NRF) conference kicks off in New York this week, it's becoming clear that the changing role of marketing inside the business is starting to have a significant impact on IT strategy.
In the wake of the economic downturn there has been significant pressure to justify the return on investment in marketing activities. This has led to major investments in marketing activities that can have a measurable impact on sales. Those investments have also created a need for marketing applications capable of measuring that impact, which in turn has increased the reliance of the marketing department on IT.
Now that marketing has collected all this information, business executives want to apply that information to fine-tune their supply chains. The basic idea is that armed with better information about customer trends, the manufacturing process can be optimized to make sure that enough of the right products are always available in the right place at the right time.
To that end, IBM at the NRF conference today formally rolled out a new software framework for integrating data gathered by marketing applications back to applications that manage the supply chain.
According to Craig Hayman, IBM general manager for Industry Solutions, IBM has "declared war on stock outs," which results when companies do not have enough inventory of a particular product on hand to meet demand. To that end, IBM has been working with Pepsi, Crocs and Mars/Wrigley to create a more flexible supply chain system that is informed by the latest data gathered by marketing.
Hayman says the ability to meet customer demand on a timely basis is critical in the age of e-commerce because customers now demand more visibility into product availability. If a manufacturer doesn't provide that visibility into their supply chain, chances are high that customers will go to an alternative supplier that provides that information.
All of this means that IT is more strategic than ever as companies look to tighten the loop between manufacturing, sales and marketing. For marketers, this shift in business strategy fundamentally changes their role in the organization. In effect, marketing is becoming more of science and less of an art, which is one reason that IBM has acquired companies such as Unica and Coremetrics. And as IT makes it possible for marketing data to transform the way the business operates, that data will change the role of IT within the overall organization.