Marketing technology has seen an impressive growth over the last years. What should we expect next? Scott Brinker, offers his insights.
Scott Brinker, Program Chair of MarTech and VP Platform Ecosystem at HubSpot, presented his insights on the state of marketing technology. He is the one who created the popular graphic of the marketing technology landscape back in 2011, updating it again this year. Its latest version features nearly 5000 martech companies and we can’t help but wonder, are there too many martech companies nowadays?
According to his stats from the 2017 Marketing Technology Landscape, there are now 5,381 solutions on the updated graphic. The number went up by 39% from last year. What’s more impressive is the fact that only 4.7% of the solutions from 2016 were removed.
According to Scott Brinker, 61.3% of the 2010 martech landscape has been consolidated.
However, he still remains optimistic, mentioning that this consolidation is not actually rampant. In fact, it has fueled entrepreneurship, as there are new companies coming up every year, with the growth outpacing the loss.
As with every other industry, there are only a few $1+ billion companies but thousands of < $100 million niche innovators and vertical specialists.
It’s the differentiation and the vertical markets that contributed to the market’s growth, leading to a growing martech demand.
This explosion in the martech industry has created new job roles, with the head of marketing technology being one of them. The responsibilities of this role vary and they blend all the stages that can ensure that marketing technology can have an integral part in an organization.
Moreover, a new study from Chief Marketing Technologist indicates that 26.9% of the respondents are about to restructure their marketing and IT departments for the sake of martech. An additional 14.9% of the respondents plan to do so in the next 12 months, while 19% of marketing leaders have already restructured their marketing department in the last year.
The rise of martech
There are many reasons that contributed to the rise of marketing technology. The simpler ones have to do with the wider digital transformation. Nowadays it’s easier than ever to build and also sell software.
Moreover, Scott Brinker notes that various environmental factors have also contributed to this growth:
- consumer tech disruptions
- entrepreneurship culture
- Moore’s Law
- accelerating business clock speed
- beyond advertising
- the viability of small and virtual businesses
All these factors led to a redefinition of marketing, gaining an expanding scope. Marketing becomes more strategic, facing departmental intersections and as it becomes embedded in products, it is now part of the full customer lifecycle.
According to Scott Brinker,
“The digital revolution has moved marketing from a peripheral function to the centre of business growth, as customer experience becomes paramount”
It has been observed that the best-of-breed marketing technology stacks dominate the market today. In fact, they are twice as popular than single-vendor suites. As 98% of these marketing technologies are focused on web, mobile web and mobile app touchpoint, the challenge is to keep up with the changes.
Scott Brinker presented the five stages of coming to terms with the marketing landscape:
- Denial: this is the stage that marketers try to focus on the traditional definition of marketing. Why should they blend technology into it?
- Anger: the rise of martech solutions can lead to anger when trying to decide on which ones to focus on
- Bargaining: there comes the dilemma on which options to choose. What if you buy everything from one vendor?
- Depression: as with every new technology, it takes time to make it work.
- Acceptance: once you start understanding the changes in marketing, you accept the current state and work towards improving your place in it
The biggest challenge for marketing leaders and organizations nowadays is to keep up with all the changes.
There is a rapid technological change, but unfortunately, organizations are not changing at a similar rate.
Thus, there is a need to change the management of the organization to take advantage of technology in marketing. Martech overlaps with marketing, technology, and management. A grand view of these three teaches us that there’s no need to separate them, as they need to be combined to bring the customer into the focus.
Leaders are able to react to all the rapid changes, allocating the majority of the investment to the core, while there’s also a wider exploration on the edge.
This could help businesses explore new innovations while scaling the most important ones into the core.
It is estimated that the average marketer uses 100 different pieces of software month and they don’t even know about 90 of them. This proves the rise of embedded technology and how marketing approaches technology.
That’s when marketers have to understand the changing business needs, helping customers first and technology second.
How is this then? Scott Brinker notes that this is certainly challenging, but also a big opportunity.