MARKETING TECHNOLOGY: Driven by technology - After years of technophobia, marketers have en masse begun using information technology. Fran Littlewood reports on the industry’s new digital love affairs

Information technology has now become the primary marketing tool, according to London software research company Softworld - and this is quite a turn around in an environment historically reluctant to embrace technology.

Information technology has now become the primary marketing tool,

according to London software research company Softworld - and this is

quite a turn around in an environment historically reluctant to embrace

technology.



But while an increasing number of marketers are using IT to streamline

the marketing process, a significant proportion criticise it for failing

to meet their expectations.



Research conducted by Softworld in association with the Chartered

Institute of Marketing (CIM) at the end of last year revealed that 54%

of organisations say they are able to target potential customers more

effectively through the use of software systems in the sales and

marketing field. More than half - 55% - say they are planning to review

their sales and marketing IT systems this year. A third expect to buy

new systems, while 22% will upgrade.



The findings show the majority are dipping a cautious toe into the

high-tech arena by initially opting for relatively low-level technology.

Most firms now have basic systems, such as word-processing packages, in

place and Microsoft’s Windows product dominates the desktop. The take-up

of internal and external e-mail systems is high, and almost 70% have set

up a web site.



Meanwhile, contact management packages that navigate their way around

basic name and address databases have been taken up by 47% of businesses

keen to automate paper-based contact management at a reasonably low

cost.



Importance of databases



In-house marketing databases, which store information on potential

customers and include data-management and data-mining functions for

profiling and homing in on targets, are increasingly viewed as a

necessity. According to Softworld, 48% of sales and marketing

departments use the technology and this figure is expected to grow to

73% within two years.



Isabelle Blackie, head of marketing communications at Carphone

Warehouse, is relatively typical as a marketer in the mix of technology

she uses.



Her department has PCs running Microsoft Office. Blackie uses

word-processing package Microsoft Word for text and the spreadsheet

program Microsoft Excel for charting financial information and putting

together production schedules. She also uses Microsoft’s Outlook for

internal and external e-mail.



For communications on the move she uses a Nokia 9110 communicator, a

mobile phone that doubles as a computer. For simple segmentation of the

client base the department runs Access, the Microsoft contact management

database. The software details names and addresses of target customers,

enabling the marketing team to collate information according to factors

such as store location.



But many marketers are becoming more ambitious. The research shows that

enterprise resource planning systems (ERP) will be the fastest-growing

technology in the marketing arena during the next three years. ERP is a

company-wide software system designed to efficiently manage resources

across all areas of a business, including sales and marketing, human

resources and finance. Just 13% of firms use ERP, but this is predicted

to rise to 38% within two years.



Bug stifles e-commerce



On the internet side, e-commerce is still more a buzz word than an

established technology, but experts predict the take-up rate will

increase significantly once companies have overcome millennium bug

worries. And there are the residual consumer worries about the security

of the internet, with many still reluctant to post their credit card

details in cyberspace. Such security issues are being addressed,

however. And a handful of players, such as Dell Computer, Federal

Express and online bookstore Amazon.com, are making it work.



Push technology, the e-mail spin-off which sees marketers post direct

electronic mailings to potential customers’ online mailboxes, rather

than paper mail through their front door, is beginning to emerge. Aine

O’Dwyer, internet marketing manager at Dell Computer Corporation, which

has gone down the push technology route, says it’s cheap, enabling

marketers to reach customers for the price of a local phone call. It

also eliminates a big chunk of the costs associated with paper-based

methods.



Critics have blasted the technology for its intrusive junk mail status,

but O’Dwyer argues that, used as part of a carefully-orchestrated

campaign, it is an effective tool. ’The web is a brave new application

for marketers.



If used correctly it will allow you to build a much clearer picture of

who your customers are and will allow you to target them much more

effectively,’ she says.



Systems still improving



Existing systems continue to be improved and updated. In particular,

significant advances are being made in database technology, according to

Mike Pearce, chairman of direct-marketing agency TSM. He argues that

’technology continues to shift the gears in direct marketing’. Databases

are becoming more complex, with an increasing number of levels being

added to basic geodemographic data. In addition, companies such as Next

Action Technology are developing more accurate search engine technology

enabling pinpoint analysis.



But while the bulk of the marketing world is beginning to shed its

technophobe status, it is experiencing teething trouble. According to

Softworld’s research, 77% of sales and marketing professionals say there

is a gap between what IT should be able to provide the sales and

marketing function and what it is delivering. Organisations cite the

main difficulty as integrating new technology into existing systems.



A number of additional barriers to adoption remain, says Softworld.

These include budgetary constraints, lengthy implementation times,

management priority, resistance to change, lack of user knowledge, lack

of a clear strategy and lack of specialist IT skills. Geoff Dowell,

chairman at business-to-business marketing agency Dowell & Associates,

says: ’A lot of people are lagging. Many of them don’t embrace

technology easily. Technology is making marketers lives in some ways

easier, but people have to change, they have to gain more

understanding.’



Pearce argues that training is a pivotal issue: ’There are a lot of

people out there who have not been trained. Companies have got to invest

in training - it’s an investment in human resources, not marketing.’



WINDOWS SHOW



Show:



The Windows Show 1999



Venue:



Olympia, London



Number of visitors:



40,000



Number of exhibitors:



120



Exhibitor profile:



Products and services featured will include database software,

e-commerce, Web TV, Windows CE, computer-aided design (CAD) and

professional-level graphics



Opening dates and times:



Tuesday, March 16, to Thursday, March 18: 10.30am until 5pm



Friday, March 19: 10.30am until 4.30pm



Industry support:



The Windows Show is backed by a Department of Trade and Industry

initiative to encourage the effective use of information technology



Additional information:



Programme will include the Windows Show Conference, detailing

case-driven solutions to all the key issues facing IT buyers, and

business briefings targeted at small- and medium-sized enterprise

information technology buyers



Further information:



Phone: 01256 384000



Internet: www.itevents.co.uk



HOW TECHNOLOGY IS HARNESSED



Aine O’Dwyer



Internet marketing manager for the UK and Ireland, Dell Computer

Corporation



For computer firm Dell, the internet has progressed from marketing

vehicle to sales medium, according to O’Dwyer. It was one of the first

UK businesses to implement e-commerce, rolling the marketing and sales

process into one electronic experience. Dell is also using push

technology as a direct marketing tool - it has a database of addresses

to which it sends e-mail.



Because print and postage costs are stripped out, it can do this at a

fraction of the expense of a paper-based campaign. It’s a technology

that has come in for criticism because of its junk mail status, but Dell

says it targets mail only at people who have requested it. Since it

sells its product direct, the company also uses sophisticated database

software to segment targets for its more traditional direct marketing

campaigns.



It has a lot of in-house legacy systems, which it plans to update to

ensure they are compatible with internet technology



Geoff Dowell



Chairman, Dowell & Associates



As a business-to-business marketing agency which specialises in the

information technology field, Dowell & Associates needs to be quick to

adopt new technology, says Dowell. To this end the company has

implemented internet systems as well as intranet technology used for

electronic communication within the company. It has also set up an ISDN

link, enabling it to send and receive large graphics files at high

speeds. Like many agencies, Dowell & Associates runs two desktop

systems, using PCs running basic Windows-based word-processing and

spreadsheet packages for account management and administrative work, and

Apple Macintosh machines with more sophisticated graphics packages for

creative projects.



It outsources its database marketing work to affiliated specialist

database consultancy Sales Technology.



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