IBM takes the lead in digital marketing via acquisitions
IBM has taken a leading position in digital marketing through a series of acquisitions – including buying three agencies in one week – and its expertise in data-processing. Its digital agency IBM Interactive Experience, known as IBM IX, combines digital transformation, big data and customer experience to help clients transform their businesses. Its big advantage is the cognitive power of computing tool IBM Watson, which can sift through data other systems cannot access. As well as the tech giant, professional services firms such as PwC and Accenture have been pushing into the lucrative world of digital marketing.

Through a string of acquisitions and data-processing forces to be reckoned with, IBM IX has taken the lead in the world of digital marketing.

A March 2017 Adweek report on tectonic shifts in the brand marketing ecosystem noted how professional services firms such as Accenture, Deloitte and PwC are muscling in on this space along with one well-known tech giant: IBM.

Big Blue, the Big Four consultancies and a handful of others are said to be aggressively pursuing an acquisition strategy that is reshaping the marketing landscape, and industry observers believe this activity will continue to ramp up. Indeed, in the early days of 2016, IBM snapped up three digital agencies in the space of one week.

So, why is a technology company entering the realm of digital marketing? For starters, it’s a lucrative industry. Adweek cites eMarketer projections that digital ad spending will top $300bn just two years from now. And then there’s the blurring of lines between technology strategy and brand strategy.

The term ‘digital transformation’ has been driving business strategies across a multitude of sectors, but now there are new terms shaping company roadmaps: ‘big data’, which is heralded as a necessary and transformative business intelligence tool; and ‘customer experience’, which is championed as the prime objective for brands to satisfy.

IBM IX

Digital transformation, big data and customer experience meet at IBM Interactive Experience (IBM IX), Big Blue’s digital agency backed by considerable computing power.

“[We] are focused, essentially, on enabling our clients to digitally transform their businesses through platforms, data and customer experience,” said IBM IX global associate partner Marketa Mach, deftly summarising the formula that has positioned the agency as one of the leaders in Gartner’s Magic Quadrant for Digital Agencies for the second year in a row, sending a warning shot to traditional agencies.

IBM IX has only been around since 2013 but was already hitting revenues of $1.9bn by 2015. It’s a young, rich and powerful agency that arrived just in time to target businesses being bewitched and bewildered by digital disruption. Speaking to Siliconrepublic.com during a visit to Dublin, Mach said IX is “particularly relevant today, in a world where we are being consistently digitally disrupted and businesses have to enter into a constant innovation stream”.

The trick up IBM IX’s sleeve is the supercomputing power of IBM Watson. In a world where each and every company is being driven to leverage data-led insights, an agency with access to a powerful cognitive computer can sift through information quagmires for valuable meaning.

“80pc of the data that’s being produced is what’s called ‘dark data’, so it’s data that’s inaccessible because it’s unstructured and it lives in systems that we can’t access, and exists in forms that we can’t understand,” said Mach. To capitalise on this data and make it a useful tool, IBM calls on its cognitive computing tools.

The great data hype

The problem with the big data hype is that companies are being driven to derive insights from data without even knowing what problems they want to solve.

“Talking about any technology in abstraction from the outcome that you’re trying to deliver is going to be less fruitful than if you have a genuine business problem or a case against which we can say, ‘Is this an appropriate application of this technology, or not?’ You know, ‘Is this a sledgehammer to crack a nut, or not?’”

In fact, Mach can sometimes face an uphill challenge when it comes to explaining how a technology that is actively being used to better diagnose and treat cancer can also apply to widely different industries and services.

“Actually, that [technology] can just as equally manifest in a chatbot feature that’s helping to alleviate call centre pressures, or help customers through a process on a website that they’re finding quite difficult, or navigate using natural language through product searches,” she explained. “It spans all of that.”