Is the CMO now the Chief API Officer?

Guest Author
Mar. 11 2013, 08:00AM EDT

This guest post comes from Andy Thurai. Andy is the Chief Architect & Group CTO for the Intel unit that is responsible for Cloud/ Application security, API, Big Data, SOA and Mobile middleware solutions. You can follow him @AndyThurai (Twitter) or at thurai.net.

Gartner analyst Laura McLellan made a bold statement in her 2012 webinar: "By 2017, the CMO will spend more on IT than the CIO". While I think it is too bold a statement, you can’t deny the fact that an eco-system shift is happening and API Management is the catalyst.  From my own personal experience, I can vouch for this shift in who is doing the big spending. A new set of tools are enabling CMOs to create new, powerful channels. They are called APIs. The very introduction of these APIs are resulting in new ways of leveraging channels and exposing content, media, and data to customers, partners, the community, developers, and even to the public.

Gone are the days during which the marketing guy sits in a corner deciding to put out some commercials, articles, and advertisements on TV or Internet and then calling it a day. In olden days, the marketing unit was considered a “cost center” as it was costing company money to generate awareness, increase traffic flow, or to introduce a brand. It used to be hard to measure the ROI for money spent on marketing. But now, as one CMO has put it, they are now the “Chief Media Owner”, which is to say that they own all content (sometimes including very valuable and sensitive data) and media about the company. Not only do they own the content, but the effort behind using that content via various channels to drive additional revenue for the company. In other words, your CMO is quickly becoming your main revenue generation guy, and hence, he is often given extra money (and has the power) to dictate the IT infrastructure. What is more important is that if IT doesn’t oblige then he/she can use the cheaper and easier cloud platforms/infrastructure thereby completely ignoring the demands and restrictions put in place by their corporate IT.

As an example, CMOs can easily share their content with whomever they want, using Box.net and the like, so they don’t have to wait around for an IT department to setup a SharePoint portal and teach them how clumsy the interface is and how awkward it might be to find content there. Using another example, a CMO can build APIs using third party vendors and host them in the cloud to expose the content/ data without going through an interminable approval process by IT whose responsibility it would be to approve, host, and manage their solution. I mention just a few examples, however, the recurring theme is: if IT drags its feet, then the CMO is going to look at less restrictive options.

In late 10s (that is 2005-2010), technology companies saw the role, contribution and influence of technology in the marketing world such as social media, big data, cloud, analytics, online advertising and other hyper social media tools such as Twitter. Now, they are seeing the reverse of it, the role of marketing can play in the technology world. In other words, you can use these tools not just to market but use ways to create additional revenue.

While the CIO budget is shrinking, the CMO budget is bulging. Often, I see instances where a CIO will go to the CMO for help and have them write the check. The CMO has become the king of IT without you knowing it. It helps them to track everything their potential customers are doing. Often they are now responsible for analysis and identifying emerging trends – which of course they can leverage for more effective campaigns. They are now afforded the flexibility to expose their data/ content to their revenue generators in any number of ways.

You don’t want to be marketing to the specific demographics anymore–such as soccer moms or single guys who are bald. In contrast, the process by which Marketing is using to disseminate its messaging is now informed by technology used to capture the essence of the person’s interest to begin with. Context-based marketing has arrived! For example, Netflix recommends more movies based on what a person is watching or watched previously (and yes it is done through APIs). Amazon recommends products to you based on your browsing history (there is an API for that as well). So in short, CMOs are willing to fund an infrastructure for greater understanding, analysis, data collection, and ultimately cross marketing.

One result of the changes abound is a major pivot by marketing executives everywhere: CMOs are allowing unprecedented access to their gold mines of Enterprise data to ultimately increase their own revenue. Prior to this new era, technology paradigm shifts were either focused on reducing cost, or increasing / improving the performance/ efficiency of IT infrastructure. Now the APIs, big data, analytics, mobile apps and the social media are changing the game to help organizations generate more revenue. This major shift has also resulted in fewer fixed budgets, cost cutting measures, and shrinking budgets. With the oft-mentioned maxim: “You have to spend money to make money”, Marketing has evolved into being recognized as a “revenue booster” and not just a “cost center”.

I want to leave you with one last caveat. Just because APIs are important and everyone is talking about them, doesn’t mean you need to jump in with two feet and start coding them right away. First you need to strategize what your end goal is, and figure out what your existing assets are, and then assess the gap between where you are and where you need to be. Once you prioritize the strategy behind your APIs, a clear picture will emerge on what to build first. Tools are there to help you out in building, executing, monitoring and monetizing your APIs. It is not just about what content you want to open up to your consumers; it is who you are opening this to – customer, partner, public, etc. While some of the data/content may have to be opened to partners, it will be dangerous to expose this to the public as an open API. You will need an API management layer to manage this controlled exposure. With this in place, you will be able to control who has access to what and when (based on Identity, local, invocation method, form factor of usage or even by time/date of the usage).

Thought should not only be given about exposing too much or too little information, but also about giving it for free when that same information can be used to generate revenue. All these considerations need to be a part of a well thought out strategy, before building anything.

Essentially, it all comes down to one thing: You give data to your customers that they want, in the way they want it, when they want it and how they want it. Sounds simple enough.

Guest Author

Comments

Comments(1)

Excellent article Andy.. I think your cautious recommendation is warranted, "just because APIs are important and everyone is talking about them, doesn’t mean you need to jump in with two feet and start coding them right away. First you need to strategize what your end goal is, and figure out what your existing assets are, and then assess the gap between where you are and where you need to be"

Software architects and developers can take five actions to avoid common API pitfalls, create business value, and monetize API assets:

1. Embrace the Managed API

2. Establish a Monetization Model

3. Make APIs Easy for Developers to Access

4. Employ Governance

5. Monitor API Use

I've published a blog post describing each facet at http://blog.cobia.net/cobiacomm/2012/07/03/five-api-actions/