The growth in scale and power of martech has been stratospheric, with an explosion of hype and investment in platforms and systems, many of which are barely out of their ‘beta’ development phase. But is that all about to change?
Marketing technology, or martech, is increasingly defining the world that B2B marketers operate in – for better, or worse. The level of investment and focus on technology is growing exponentially, as evidenced by the continued growth of the number of vendors listed in the chiefmartec.com chart, which hit 7000 for the first time this year.
But what are the practical implications for B2B marketers (particularly senior ones) in managing this technology – and more importantly, in delivering effective marketing communications? Furthermore how are these implications going to change should our reliance on tech deepen (as looks most likely)?
These are some of the key questions that B2B Marketing and Stein IAS wanted to answer in a landmark report on this exploding and increasingly important scene. But perhaps more importantly, we also wanted to get a sense of whether the hype and momentum behind martech was showing signs of tailing off. Are CMOs beginning to focus on making the best use of the infrastructure they have, rather than continually investing in more new kit – and dealing with the inevitable disruptions this would entail? In other words, we wanted to understand if there were signs we are exiting this first rapid ascent phase of martech development, and whether we’re seeing the emergence of a more measured, less hype-fuelled (but probably more effective) attitude and approach to martech. As the title suggests, the rise, fall and rise, of martech.
To build a picture for this report, I personally interviewed nine senior marketers in leading B2B organisations on different sides of the Atlantic, to understand their martech strategy, the challenges they have faced, and where they believe the future lies. These interviews were some of the most prescient and interesting that I have conducted in 14 years of running B2B Marketing, and provide a fascinating perspective of an industry (if not a profession) in a state of transition.
The full report is available to download from our site, but for this edition of B2B Marketing we’ve summarised some of the key findings below.
1. Enthusiasm for martech remains a critical component in marketing success
Marketers are spending between 30% and 50% of their budgets on the technology and associated people skills. There is some evidence this is starting to flatten out, as some companies review their existing infrastructure, but the overall trajectory appears to be upward. The overriding message is that today’s marketing leaders can’t do their job without martech, their optimism surrounding the potential of the technology vastly outweighs any cynicism.
“Marketers will not succeed without martech – it’s not even an option. Does that mean it isn’t complex? No. Could we still get into trouble without the right skills to use the best tools? Yes. But the idea that it’s optional is a flawed premise.”
Matt Preschern, senior VP demand and performance marketing, CA Technologies
“The capability of martech now compared to even two to three years ago is radically different in terms of what you can actually put into action. It’s not just pie in the sky anymore. The solutions all actually work well. Now it’s more about building a business case to find the best solutions out there and whether it delivers a return.”
Andrew Nester, CMO, Nuix
2. The tech stack is growing in size and complexity
Management of this has become the biggest martech challenge. Some of the marketing leaders we spoke to had up to 50 separate platforms in their martech stack – although such proliferation was typically the result of merger and acquisition, rather than profligate purchasing.
“Am I daunted by the chiefmartec.com landscape chart [which shows 7000 martech platforms]? Yes, I am, and I’m daunted by the chart of our own tech stack. We’re constantly working with new platforms and new organisations. We need better knowledge in this area, and we’re boosting our marketing ops team to enable this. We rely on them to trial and measure. I need a line of site on these new things.”
Kathy Seegebrecht, CMO, UL
“Looking at the martech map is scary. There is just so much out there, it’s hard to know who does what anymore. But CMOs need to stay on top of this, as needs change and new things become important. You need the ability to ‘sunset’ some technologies and implement new ones.”
Vasu Jakkal, CMO, FireEye
3. Marketers don’t want the future of their martech stack to be dictated by vendors and whatever’s on their development roadmap
This has particular resonance for the cloud solutions vendors (Oracle, Salesforce, Adobe, IBM, Microsoft), whose aim is to facilitate as many martech needs as possible within one integrated suite.
“The vendors are expanding their capabilities and replicating the functionality of one another. What is best-of-breed anymore? There has to be consolidation of the martech world. We need to get budget working harder, and it’s easier to do all of this on one platform than on four.”
Paul Stevenson, head of marketing operations, O2
“The growth in marketing cloud providers could go one of two ways. Firstly, everyone buys one cloud solution or other. This means integration is hassle free, but it results in high prices, lock-in, lack of control and no flexibility. The second scenario is best-of-breed. But that requires you to have a world-class team to make it work, and you’ll need to integrate everything. The nirvana is somewhere in the middle, with some degree of interoperability. We all want choice, flexibility and the ability to create innovation.”
Vasu Jakkal
4. There are numerous speed bumps and obstacles along the road to building your optimum martech stack
“Martech requires new skills and responsibilities, and we need to create these within the organisation. Talent is in demand, and there’s more demand than supply. This can bring your budget up. To manage this, we are spending less on agencies and managing more marketing ourselves. This has benefits in terms of cost and flexibility.”
Kathy Seegebrecht
“It’s becoming harder and harder to be average as a B2B marketer. Today, with the level of technology involved in execution, there’s nowhere for marketers to hide. If you’re not getting enough traction, you’re probably not doing your job well enough. This will inevitably challenge marketers.”
Antonia Wade, CMO, Thomson Reuters
“Our CEO and CFO are very interested in marketing, and that’s a double-edged sword. In other places where I’ve worked, marketing was a little island. At Nuix, we’re seeing a very big investment in marketing in a very positive way. My challenge is that our c-suite needs to take time to understand what we’re doing. Their understanding of marketing is a bit outdated. But you also have to prevent them from being too excited and manage their expectations.”
Andrew Nester
“The discussion around shadow IT will only grow. Martech was previously seen as a tactical solution, and marketing was not scrutinised over the investments it made. That’s starting to change now, and you could say that it signals martech is growing up… but it doesn’t always feel that way!”
Matt Preschern
5. There are a handful of key challenges which marketing leaders need to address in order to enable martech to achieve its much-anticipated potential
“The biggest challenge is integration. Every time you take a new bit of tech, you have to look at how it will integrate. And you need to train people on how to use it. CMOs need specialist resource to handle it. In the pitch process for new technology, integration challenges are not considered thoroughly enough.”
Vasu Jakkal
“A key learning for me is that I would do more scoping at the start and look more closely at the impact. I’d ask vendors where they think we should focus, where the bottlenecks might be. Now that we have the right skills within the team, it’s much easier. It took us 18 months to roll out Eloqua for enterprise customers in 2013, but it only took us 12 weeks to roll it out last year for the midmarket team because we have the in-house skills.”
Paul Stevenson
In interviewing marketing leaders for this new report, The rise, fall and rise of martech, Joel Harrison called his conversations the “most fascinating” he has conducted in 14 years of running B2B Marketing. I’d add that they may be the most important.
According to Gartner, B2B marketers in the US and UK are on average allocating 22% of their budgets to martech. Many other studies validate this investment level and martech’s ongoing adoption. Clearly, martech has risen with amazing speed and seemingly will keep rising in prominence and predominance.
Yet, for all the data pointing to martech’s ascendance, many other reports point to a parallel and far different reality – namely that marketers’ proficiency in utilising martech and realising the desired benefits lags far behind investment levels.
This begs the question: Are the massive bets marketers are placing on martech not paying off? And is martech actually starting to level off or even decline because of this?
In Stein IAS’ view, the answer is no. Martech is not falling and, inevitably, will continue to rise. But as the study clearly indicates, marketers are grappling with enormous new challenges.
Meeting those challenges is the imperative of the day for B2B marketers for two interrelated reasons. The first is that the stakes are high – and our seat at the table ultimately rides on the results we must deliver on the back of martech. The second is that B2B’s impending post-modern marketing era will be marked by creative and content experiences that will rise to new heights powered by a growing grasp of digital technologies.
The role and relevance of martech in B2B have never been greater than right now. The rise, fall and rise of martech provides a compelling view of how CMOs are preparing for the future.
