Infrastructure Providers on the Rise

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The e-commerce and general Web infrastructure of corporations will soon be recognized for what it should be: a marketing channel like direct mail or call centers.


The marketing departments of large corporations have always had a mandate to create an integrated, brand-focused customer experience across all interactions spanning elements such as sales channels, call centers, customer service and advertising.


Soon they will add the Web channel to their portfolios. The management of a customer's Web experience with the corporation will be the primary responsibility of marketing departments. The ownership of the Web by marketing will give way to a powerful new player known as the marketing infrastructure provider.


Marketing succeeds by outsourcing. Marketing departments have had more than 50 years of success at outsourcing. Ad agencies are the best example of outsourced marketing services. Marketing relies on a portfolio approach, deploying a range of suppliers across various marketing tactics under one marketing strategy. Marketing infrastructure providers will join these common suppliers such as ad agencies, direct mail houses, database marketers, public relations, promotions and distribution channel partners.


Typically a marketer would be forced to rely on internal technology providers to execute online programs. A marketing infrastructure provider will remove this barrier. Marketing infrastructure providers are not technology solution providers, and this is why they will be successful. They possess flexible technology platforms that can augment the Web infrastructure of a corporation. They provide marketing insights and marketing support to corporate marketing efforts.


The closest analogy is an ad agency with its own turnkey hosted and managed technology that can be deployed rapidly and easily adapted to reflect the evolution of the marketing strategy. Marketing infrastructure providers will have staff that can assist clients with engaging, retaining, up-selling and acquiring customers.


E-commerce is simply a marketing channel. Marketers soon will see e-commerce as it should be seen - as a marketing channel like direct mail or call centers. Many corporations have entrusted the Web to e-commerce or technology departments.


Technology will resume its customary role of simply supporting internal enterprise initiatives rather than customer-focused initiatives like the Web channel. Technology would not be involved in a direct mail campaign and similarly should not dictate the Web distribution channel. The long-term view of technology simply clashes with the short-term campaign objectives of marketing. While marketing must be nimble and customer-focused, technology implementation and management by their nature are methodical and procedural.


Infrastructure providers will provide turnkey solutions to marketers that require no technology to be built or ownership costs (the GartnerGroup estimated in a recent survey that the average cost to build a leading online presence was $4 million to $9 million). The infrastructure should be rapidly implemented and adapted as well as entirely hosted and managed externally.


Key capabilities of marketing service providers. Marketing service providers are not technologists. They assist in the standard marketing objectives of engagement, retention, upsell and acquisition. Marketers will expect them to provide various other services. Here is what corporations should look for in marketing service providers.


o Marketing-friendly turnkey solutions: When it comes to Web marketing, IT is being moved to the back burner. Marketers will insist on buy vs. build decisions that are quick to market and customer-responsive. Infrastructure providers will offer turnkey platforms that will be implemented quickly with no technology installation or ownership required.


o The creation of compelling customer experiences: These providers will be expected to create rich customer experiences. With a product focus, Fortune 1000 corporations are finding their sites less compelling to customers. A major function of infrastructure providers will be to deliver a customer-centric experience that engages users rather than simply pushing a product. The dot-coms have raised the bar in terms of providing this rich customer experience, and the Fortune 1000s must follow suit by respecting online users' demands for ancillary services, tools, content and information to help in their purchasing decisions.


o Branded experience: Marketers as protectors of brand equity should insist that the entire experience be branded, just as all customer contact points, including physical locations, sales representatives, call centers and advertising, are under the brand umbrella.


o Provision of business intelligence: Data resulting from customer interaction with the experience must be captured and assimilated into customer relationship management systems. To date, CRM systems provide only a limited window on a customer because they rely on the product need shown by transactions or points of customer contact.


Marketing infrastructure providers will be able to provide a whole new view of the customer based on actual need vs. product need. For example, a regional telephone company using a provider to deliver a portal that offers extensive information about managing and growing a business could begin to understand far more about future tendencies of its customer base. Customers would view the telephone company as a convenient provider of information on interviewing, employee motivation or regional hiring regulations.


These firms could be inferred to be "very likely to grow" because hiring employees is a key indicator of growth. This data will provide marketers with an explosive new variable and a predictor of future purchase behavior. Helping marketers extract this intelligence will be a key function of infrastructure providers.


o Strategic marketing advice: Marketing infrastructure providers will have professional marketing consultants who can assist clients with engaging, retaining, upselling and acquiring certain customer sets. These providers may become known for specialization by segment: business-to-business, small business, medical or consumer. This will enable them to use their knowledge economies for the benefit of their clients.


A marketing service provider has the unique ability to provide marketers with the capacity to offer their clients branded and engaging customer interfaces. They also will own and manage the technology platform upon which to present the experience. For the marketer, there will be no technology build or need for technology department involvement, but there will be the ability to instantly adapt or evolve the offering. Business intelligence will be gathered by the interaction of the customer with the infrastructure, creating a virtual two-way mirror on the customer's activities.


The outsourcing success associated with marketing departments is not likely to cease after a 50-year legacy. On the contrary, it will mean that marketing infrastructure providers are here to stay, even though they have just arrived.


David Ceolin is CEO of Digital Cement, Westboro, MA.
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