Columnist Rachel Balik notes that while the marketing technology landscape is broader than ever, many marketers are still struggling to utilize these technologies in a useful way.
If marketing technology had a spirit animal, it would probably be the bunny rabbit. In 2011, there were perhaps a couple hundred marketing technologies available. Today, Scott Brinker’s latest landscape includes almost 2,000 companies that fall into 43 different categories.
This leap signifies a booming space and a lot of opportunity. But it also raises a lot of questions about how marketing as a discipline is changing and how marketers will adapt. Although these technologies are cutting edge, there’s often a lag between what’s available and what marketers are prepared to use. It’s unclear just how much benefit marketers are getting from this technology.
An initial overview of the stats might convince us that we are indeed in the Golden Age of marketing. A new study from the research company Signal found that the average company has 17 marketing technologies in use. IDC recently predicted that marketing technology spend will reach $32.3 billion by 2018. Data from Conductor indicates that 65% of senior marketing executives plan on increasing their marketing technology spend in the coming year.
What’s Really Happening With Martech?
You might skim those stats and feel like marketing technology is on a straight ascent to success. But dig a little deeper into the report from Signal and you’ll find that there’s a bit of a delta between vision and reality. As it turns out, of all those companies with deep marketing technology stacks, only 4% feel that they have an integrated stack.
Maybe you’re thinking, “So? What’s the big deal?” After all, marketing encompasses lots of different areas of tactical specialization such as SEM, marketing automation, the website, analytics, CRM, etc. It makes sense that our technology might manifest itself and exist happily in those silos.
Or maybe you feel like one of the bigger marketing clouds can deliver a solution that meets all your needs. But when it comes to real-life execution, neither of these scenarios plays out exactly according to plan.
Applying point solutions to solve specific problems might work initially, but when it comes to connecting them at the strategic level, their value is greatly diminished. And at this stage in the game, it’s hard to find 17 solutions customized for your business needs all within one marketing cloud.
While some marketers might argue that an integrated stack is a “nice to have” and not a “must-have,” 90% of the marketers in the same Signal study felt that an integrated stack would indeed boost their key capabilities.
What’s The Opportunity Cost?
It’s always fun to have a friendly debate — but ultimately, to determine the importance of an integrated stack, all we have to do answer a simple question: What’s the cost of disconnectedness?
The exact dollar amount will vary based on company and technology, but study from Forrester/Qubitrevealed that it’s not insignificant. For starters, for many companies, the money they spend on new technology is wasted simply because they don’t even use the technology. One result of poor integration is that technology is underutilized.
The study found that 56% of companies underuse their technology, and 21% have technology that has literally become “shelfware.”
Part of the reason that one particular solution or another doesn’t get used is that there’s a lot of overlap between them. 72% of respondents said they had technology with overlapping capabilities, a problem that arises particularly when solutions are selected to address siloed tactics.
There’s a price range, but none of these marketing technologies are what you’d call “cheap,” so failing to use them is significant wasted investment. Even beyond that, there are negative impacts for the business. Over 50% of respondents reported that when marketing technology doesn’t work, reduced new sales revenue and increased cost of customer acquisition were among the top negative impacts. Around 40% said it reduced customer lifetime value and decreased renewals.
The Pressure To Compete
Even before reading these stats, most of us intuitively understand the challenges — and the pressure — of implementing a new technology. At the same time, there’s a powerful allure (“It seems like everyone at Dreamforce/on Twitter is having crazy success with X technology!”).
Plus, there’s pressure to compete: One look at that martech landscape and you can’t help but wonder what your competitors are using that might help them move ahead of you in the coming year. On one hand, you want to take a leap and early-adopt everything you can get your hands on. On the other hand, you can’t help but wonder, “Is marketing technology a case of the Emperor’s new clothes?”
With so many companies missing the mark, one has to wonder if the technology isn’t as great as it’s cracked up to be. At the same time, we have real, tangible examples of companies who are using technology to significantly impact business, both at an operational level and also in terms of revenue.
It’s The Strategy, Stupid!
A closer look at the whole ecosystem reveals that the problem isn’t the technology. It’s the strategy behind the technology. Neither implementing a sporadic collection of point solutions nor swallowing a pre-packaged platform will help you meet your most critical business goals.
As we all know, a strategy is much easier to talk about than create or execute, and for years marketers could get away with faking their way through strategies. One inadvertent impact of marketing technology is that it will shine a light on those marketers who don’t have their strategies together and potentially further complicate their ability to succeed.