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March 15, 2017

The Importance of Innovation and Change in the Digital Age

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This year’s HSMAI Digital Marketing Strategy Conference carried the lofty theme “Optimizing the Digital Experience,” and for a full day the nearly 400 attendees packed into a Marriott Marquis ballroom in Manhattan heard about many things, but none more important than the need to innovate and accelerate change in order to embrace and maximize the opportunities of the digital age.

In a conference filled with speaker after speaker sharing head-spinning facts about mobile device usage, the ways to leverage social and search, the importance of Net Revenue Per Available Room and other industry-shifting, digitally enabled tools and information, the question I kept coming back to was how can we successfully manage this rapid change and spur innovation in our people, organizations and industry?

In some ways, the whole idea that we still talk about digital marketing as its own thing feels a bit dated. After all, successful marketing today, especially in travel, requires a deep dependency on digital and an integration of both on- and offline activities for everything from marketing to service delivery. It’s no surprise then that one of the underlying messages from multiple presenters was the need for organizations to promote much more integration and increased collaboration between all departments.

Scott Brinker, the author of Hacking Marketing: The Convergence of Marketing and Software, outlined how fast technology is moving in comparison to how slowly organizations evolve. To prove his point, Brinker shared his now-famous chart that has the logos of all the vendors of marketing technology and software. In 2011, it featured 150 logos. In 2014, it had 1,000. Today, it has over 3,500 and it continues to grow!

Then he cited the “Walker Sands State of Marketing Technology” study in which marketing executives said that the speed of marketing technology evolution was happening at lightspeed (16%) or rapidly (56%) versus an organization’s ability to keep pace at lightspeed (9%) or even rapidly (24%).

This gap between the speed of change and an organization’s ability to keep pace is something that Brinker and other speakers felt that companies must proactively address. Knowing how difficult organization change can be, he stressed the need to focus on those things within your organization that truly matter and make a difference.

This need to adapt and change also fueled his comments that marketers need to start thinking like engineers since marketing and software have become so intermingled. He said “agile” is the new model and the ability to build, test, refine and repeat quickly and cost efficiently are keys to success. Innovation with its focus on experimentation, exploration, failing fast and speed is replacing older models more concerned with scalability and a focus on standardization, exploiting, failing slowly and dependability.

This need for our industry to evolve and change its approach in the digital age was reflected further when a panel of hotel and travel industry CMOs took the stage and were asked what the CMO of the future would look like.

Jeff Senior, VP Marketing at KSL Resorts, emphasized the increasing need to be analytical and measured and to be able to successfully bridge all marketing, operations and business roles. Dorothy Dowling, SVP and CMO at Best Western, suggested that a voracious curiosity was critical and that CMOs of the future would be measured by their CQ (Curiosity Quotient) and insatiable desire to keep learning. Josh Lesnick, EVP and CMO at Wyndham, thought the essential skill would be the ability to consume huge amounts of data and manage a very diverse workforce.

These leaders also weighed in on the many organizational challenges they are confronting with digital. Lesnick said the reality is that we’re all trying to spread the same amount of marketing dollars across more marketing channels than ever and that funding is not well aligned with how marketing is being done today. Indeed, many of the legacy models for marketing funding that are built into many existing franchise and brand agreements were never designed for the realities of the digital marketplace.

For Senior, the intersection of owned, earned and paid channels has also given rise to the increased need for and importance of campaign managers that can oversee and coordinate across all three areas. This point was amplified further by Dowling who continued to emphasize accountability and the co-dependency and shared ownership that is now required across all marketing, sales, technology and operations areas.

Of course, innovation comes with a cost and Dowling was quick to point out that selling innovation and change to an organization isn’t easy. She said it still comes down to establishing the business case and creating a linkage to a bottom-line impact. Lesnick said that Wyndham has really embraced the agile test-and-learn approach. It enables them to try an idea in five or ten properties and gauge effectiveness in an efficient and cost-effective manner. It allows them to learn fast and cheap, even subsidizing and funding the test. When an idea works, these beta properties become the advocates of the program.

Of course, despite the obvious growth in digital and the impact it’s had on all aspects of our business, it can still be difficult to break the legacies and organizational silos that exist in our industry.

For those slow to embrace the change, Gary Oster, EVP at the U.S. Travel Association, summed it up best when he said, “We need to ask ourselves what’s the risk if we don’t innovate and change? How much are we going to lose and how costly is it going to be to try and catch up?”

As the HSMAI conference made clear, these are questions every organization needs to be addressing.

In the digital age, there’s no time to delay.

Copyright 2017 MediaPost Communications. All rights reserved. From http://www.mediapost.com. By Gary Leopold, Columnist.
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