Navigating MarTech — Marketing’s Essential Yet Challenging Ingredient
It’s no secret that marketing organizations are under enormous pressure to meet evolving customer demands while facing challenges for resources. Marketers are under so much pressure that 40 months is the average tenure of a CMO, shorter than any other C-suite executive.[1]
One factor that makes today’s environment particularly challenging is marketing’s heavy reliance on Marketing Technology (MarTech). The rise of MarTech and its importance to marketers coincides with the transformation of marketing. Marketing has evolved from what was once a discipline akin to an art form relying on messaging and persuasion into something closer to a science where conversion rates, cost-per-thousand, and other digital media terminology reign supreme.
Over the past 20 years, countless articles have discussed the shift of the CMO from a creative communicator to a role that embraces process, data, and, of course, technology. The debates are often acrimonious, with traditionalists insisting marketing is about crafting the right message against a new generation that would rather turn the creative process on its head, start with multiple variants, test, learn, and repeat.
Lest we forget, it was only in 2012 that Gartner famously predicted, with much fanfare, that the CMO would likely spend more on technology than the CIO within five years, or 2017.[2] It’s years past Gartner’s deadline, and marketing has evolved to become a ravenous consumer of technology. Believe it or not, MarTech now constitutes a whopping 26% of overall marketing budgets for most brands, slightly more than labor, which accounts for 25%.
The MarTech conundrum
MarTech is challenging due in large part to its overwhelming complexity. No exaggeration, thousands of MarTech solutions now exist in a rapidly growing marketplace –and the evolution has been dramatic. Scott Brinker, the editor of ChiefMarTec.com, first published a map of the marketing technology landscape in 2011 that contained approximately 150 vendors.[4] From its humble beginnings, this ecosystem gradually expanded, eventually becoming the MarTech 5000 to describe its scope.
Today there are more than 8,000 MarTech solutions, and the landscape continues to evolve. In 2020, for example, the number of solutions grew 13.6%, even factoring in 615 vendors from the 2019 landscape that went away due to consolidation with another MarTech company or by simply becoming defunct.[5] This complexity confounds marketers: a recent study by Netcel indicated that 57% of marketers say the marketing technology landscape is very confusing.[6]
Taking advantage of this complexity and marketers’ confusion, MarTech salespeople have sometimes been known to exaggerate what tools do, or don’t do, to sell licenses. The net effect is brands buy tools they don’t need, that don’t work as advertised, or that overlap with other solutions already in their tech stack. This unnecessary purchasing results in inefficiencies and waste — not to mention unhappy marketers.
For example, marketers can select a Marketing Automation Platform (MAP) as a system or record for first-party data instead of a Customer Data Platform (CDP). Can a MAP act as a CDP? In some cases, yes, but certainly not as well. Given the dynamism and complexity of the MarTech landscape, marketers are rightfully confused and often need help navigating the solutions and extracting value from the invested-in tools. Defining MarTech is a good place to start.
Navigating the landscape
Slalom defines MarTech as a grouping of technologies and data sets that marketers leverage to execute and optimize marketing activities to engage with customers in the digital space at every stage of the customer journey.
MarTech is, however, ultimately about more than just the tools themselves. It essentially encompasses the business logic, process automation, and technologies required to effectively deploy digital marketing, align resources, and execute customer-centric strategies.
Taking things up one level, MarTech strategy ensures the alignment of MarTech solutions to the business’ vision, goals, people, and processes. Counterintuitively, The best way to do this is to begin by focusing on capabilities — not tools.
Slalom’s marketing transformation framework helps rationalize MarTech as a concept and aims to support brands in their quest to mature across core capabilities and strategy.
This approach incorporates an outside-in methodology, similar to that used rigorously in the discipline of Customer Experience (CX). To quote Steve Jobs, arguably the most famous CX advocate of all time, “You start with the desired experience and work backward to the technology, not the other way around.”
· Step 1: Start with understanding customer behaviors and needs, looking across interactions, touchpoints, and experiences–i.e., “outside”
· Step 2: Compare against business strategy, operations, organization, and processes used to support marketing
· Step 3: Understand how your tools, processes, data, and people are meeting the needs of customers and marketers
Using a capability framework
Looking at the technology, the tools themselves fall into three main layers in Slalom’s framework: data, decision, and delivery, with analytics running across all three. Slalom’s MarTech framework breaks down these three layers with the main groups of “solutions” called out in each one. This is a simplification of an incredibly complex tapestry of connected solutions and platforms–yet abstracting the MarTech stack has immense value in understanding how systems connect, what purpose they serve, and an individual tool’s role in supporting the customer journey.
Taking things a step further, the best approach for planning MarTech starts with defining the overall strategy or experience. This vision is turned into foundational capabilities organizations need to deploy to create the desired experience, which can then be mapped against the tools themselves. Further, when getting value from MarTech capabilities actually go beyond the tools themselves, because systems require a unifying strategy or vision, people are needed to run the tools, and processes to ensure systems are being used efficiently within established marketing workflows.
Slalom’s MarTech Analysis Framework has more than 90 unique capabilities cutting across strategy, resources, processes, and, of course, marketing technology. This framework gives brands an essential tool for inventorying and organizing capabilities, prioritizing areas of investment, and identifying strengths, weaknesses, and gaps.
Need support navigating the world of MarTech? Slalom is happy to help.
[1] Marketers Are Resigning En Masse; Here’s Why That’s Good For Business, Forbes, 08/20/2021
[2] Yes, CMOs will Most Likely Spend More than CMO on Technology by 2017, Gartner, 09/20/2016
[3] Marketing Budgets Fall in 2021, MarTech Share if Budget Increases, MarTech Alliance, 07/14/2021
[4] Martech 5000 Landscape Portal, ChiefMarTech.com, 2020
[5] Marketing Technology Landscape Supergraphic (2020), ChiefMarTech.com
[6] Latest Research: From Digital Transformation to Digital Evolution, 05/26/2022
