Shadow IT: Why It’s a Problem in Channel Marketing and What to Do About It

Shadow IT.

It sounds like the kind of term you’d hear in a spy movie or a cop show.

But it’s actually something you’ve likely encountered in your own workplace.

And it may run rampant across your channel partner network.

In fact, shadow IT accounts for 35% of marketing tech stacks.

Now, don’t panic — shadow IT isn’t as devious as it sounds.

But it is something that can affect your marketing (and not in a good way).

Let’s explore the ins and outs of shadow technology, why it’s a problem for marketing, and how you can put a stop to it.

What is shadow IT?

Shadow IT is when an organization’s employees use external IT resources, such as software, hardware, applications, or devices without the knowledge or approval of the IT department. In the context of channel marketing, it’s when a brand’s local affiliates use these external technologies unbeknownst to the brand.

Despite the ominous name, shadow IT isn’t malicious software or tech intentionally meant to corrupt computer systems — it’s just run-of-the-mill programs being used for company purposes despite not being company-sanctioned.

Shadow IT examples

Okay, so what exactly qualifies as shadow IT?

Lots of applications fall under the shadow technology umbrella, including:

• Cloud storage solutions like Dropbox and Google Drive.
• Graphic design tools like Canva and Adobe Photoshop.
• Generative AI tools like ChatGPT and Jasper.ai.
• Messaging apps like WhatsApp and Slack.
• Personal hardware like laptops, tablets, and flash drives.

In short, shadow IT is any piece of information technology not supplied or approved by the employer or brand.

Why is shadow IT a problem in marketing?

Let’s get one thing straight: Shadow IT isn’t inherently bad. The issue isn’t necessarily the technology itself — which is likely being used for the benefit of the company — it’s the fact that this tech flies under the radar of the brand. In other words, it hasn’t been vetted, approved, or monitored by the people in charge, putting the organization at risk.

If your affiliates create local marketing assets using shadow technology and put these materials into the marketplace, you should have some major concerns.

Compliance violations

Even the best shadow IT on the market can’t account for compliance. That means even if affiliates use this technology to generate the most visually stunning assets or the most compelling copy, they could be in violation of brand or legal guidelines. These violations can result in:

• Inconsistent brand experiences
• Poor brand recognition
• Reputational damage
• Misleading marketing
• Loss of consumer trust
• Fines and lawsuits

Security risks

You might be able to recognize sketchy sites or software — but that doesn’t mean your affiliates will. As a result, a less-than-reputable piece of shadow IT could bring chaos to your brand in the form of viruses or malware.

Aside from basic cyber threats, shadow IT also puts your brand at risk of data loss and security breaches. Using unsecured devices or applications to store and share assets makes this data easy to breach and hard to recover.

Scattered assets

If your affiliates use shadow IT to store and access marketing assets instead of leveraging a single, centralized location, chances are you have a bunch of different versions of the same asset floating around, making it impossible to know which ones are the correct ones. That means you can expect old logos and V1s to run wild.

Needless to say, these are not the materials you want your partners to use to promote your brand.

Lack of visibility

If marketing assets are being created, stored, and shared across shadow IT, you, as a brand, will have little to no visibility into these materials nor the ability to access them. That means you won’t be able to leave feedback, catch errors, or provide updated information before these assets hit the marketplace.

Compounding costs

If one of your affiliates is using shadow IT, chances are they’re not the only ones. Which means your partners are likely individually expensing these solutions, costing your organization money. Rather than one enterprise contract for the technology, there may be tons of small subscriptions across your affiliate network that don’t get bulk discounts.

Why do affiliates use shadow technology?

If shadow IT comes with such major risks, then why do people use it? Simple — it makes their jobs easier.

Brand-authorized software and programs can be complex and frustrating to use, especially for local partners with limited experience employing these types of tech. As a result, they turn to outside technologies that can get it done faster and easier.

Combating shadow IT with Palette

Knowing the reason people seek out shadow IT, the solution is very simple: Give your affiliates the tools they need to succeed and make this tech easy to use. If your solutions are simple and efficient, your partners won’t have a reason to go searching for something better.

Easier said than done, right?

That’s why we created Palette.

Palette is the graphic design solution where design meets compliance. Built with brands and their affiliates in mind, this platform makes creating high-quality print and digital assets easy while running all artwork through automated compliance checks so violations never slip through the cracks.

With Palette, your partners get user-friendly design functionality while you get guaranteed brand and legal compliance.

It’s a win-win.

Get high-quality design tools without sacrificing compliance

Say goodbye to shadow-IT-created marketing assets. Explore the possibilities of Palette to see how easy, eye-catching, and compliant design can be.

Book a demo to try it out today.