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#MarTechFest 2019 - Amy Rodgers
- 1. Toolkit 2020 Insights into the global martech market
- 2. Toolkit 2020Martech: 2020 and beyond Advertising, marketing and media intelligence • Research • Data • Best practice • Case studies • Event reports • Trends • Awards 65,000+ pieces on best practice, trends, insights, research & case studies etc. Search for 100+ topics on effective marketing. Or let one of our team help: www.warc.com/demo
- 3. Toolkit 2020 The challenge of data access and overload
- 4. Toolkit 2020Martech: 2020 and beyond 4 takeaways from the research: 1. 2. 3. 4. The martech ecosystem has room for growth Organisations need to find the right skills balance to capitalise on martech investment Optimising CX is not a one-platform pursuit Automation, machine learning and AI will see growth
- 5. Toolkit 2020Martech: 2020 and beyond 4 takeaways from the research: 1. 2. 3. 4. The martech ecosystem has room for growth Organisations need to find the right skills balance to capitalise on martech investment Optimising CX is not a one-platform pursuit Automation, machine learning and AI will see growth
- 6. Toolkit 2020Martech: 2020 and beyond “The number of technology providers in the martech ecosystem has reached capacity”
- 7. Toolkit 2020Martech: 2020 and beyond “What best describes your martech capabilities?”
- 8. Toolkit 2020Martech: 2020 and beyond The martech market in North America and the UK combined is now worth $65.9bn
- 9. Toolkit 2020Martech: 2020 and beyond “What percentage of your overall marketing budget do you typically spend on marketing technology?”
- 10. Toolkit 2020Martech: 2020 and beyond “ Agencies as eyes and ears in the market The value agencies can add for brands is to provide them with independent, objective advice on the best tools to use. They can help brands filter through the bombardment of trial and demo requests, by knowing what’s out there and worth experimenting with. Mark Wainwright,Associate Director,Teneo
- 11. Toolkit 2020Martech: 2020 and beyond 4 takeaways from the research: 1. 2. 3. 4. The martech ecosystem has room for growth Organisations need to find the right skills balance to capitalise on martech investment Optimising CX is not a one-platform pursuit Automation, machine learning and AI will see growth
- 12. Toolkit 2020Martech: 2020 and beyond Upskilling and balancing data with strategy and creativity 59% of organisations have the internal skills and talent to capitalise on martech investment
- 13. Toolkit 2020Martech: 2020 and beyond “What do you see as the main barriers to martech investment and use?” 1. 2. 3. Marketing budget constraints Lack of understanding of the technology available Lack of skills and talent
- 14. Toolkit 2020Martech: 2020 and beyond “Rank the top three most important skills in order of priority when hiring into the marketing function at your company” “Rank the top three skills that you think should be your clients’ priority when hiring into the marketing function”
- 15. Toolkit 2020Martech: 2020 and beyond “ Strategy skills are needed for long-term effectiveness Data is not the “the new oil”. Data is very good as long as it’s updated and cleansed. But equally important is strategy. If strategic skills are lacking, it’s efficiency over effectiveness and that only works for short-term success. Steve Dawson, CEO, Ratio Creative
- 16. Toolkit 2020Martech: 2020 and beyond 4 takeaways from the research: 1. 2. 3. 4. The martech ecosystem has room for growth Organisations need to find the right skills balance to capitalise on martech investment Optimising CX is not a one-platform pursuit Automation, machine learning and AI will see growth
- 17. Toolkit 2020Martech: 2020 and beyond Customer experience continues to drive the agenda in 2020 57%of organisations place customer experience optimisation as a top priority 73%have the technology in place to optimise the CX across most if not all channels and touchpoints
- 18. Toolkit 2020Martech: 2020 and beyond “Which of the following technologies are you using to optimise the customer experience?
- 19. Toolkit 2020Martech: 2020 and beyond 4 takeaways from the research: 1. 2. 3. 4. The martech ecosystem has room for growth Organisations need to find the right skills balance to capitalise on martech investment Optimising CX is not a one-platform pursuit Automation, machine learning and AI will see growth
- 20. Toolkit 2020Martech: 2020 and beyond “Looking forward, what do you think will present the most exciting opportunity in three years’ time?” 1. 2. 3. Using marketing automation to increase efficiency Machine learning and artificial intelligence Virtual and augmented reality
- 21. Toolkit 2020Martech: 2020 and beyond “ The rise of artificial intelligence It’s really important for marketers to understand AI. It’s an incredibly flexible tool, but at the moment it is still at a stage where it’s a bit of a buzzword. Simon Kingsnorth,CMO, City Relay
- 22. Toolkit 2020Martech: 2020 and beyond In summary: • Know your objectives and metrics • Upskill and invest in talent • Structure and clean your data • Go to the board with an effectiveness story • Use your agency’s expertise • Consultation and advisory
- 23. Toolkit 2020Martech: 2020 and beyond Thank you
Editor's Notes
- Report published a couple of weeks ago about the martech market – great timing for us to be able to share the results. Copies. Show of hands.
- For those that haven’t – we are a publisher of marketing effectiveness content, to which agencies, brands, media owners and academics globally subscribe to to learn about how to make their marketing more effective, whether that’s through our database of case studies, best practice guides, trends pieces or research. Historically our core user base was strategists preparing for pitches or looking for inspiration, but our growth in users is now on the brand owner and media owner side of things.
- So on to the report. This is an annual report that we do with BDO – business advisory firm – about the current state and future expectations of the martech industry. This is the third year we’ve worked on the report with BDO and this year we also partnered with the University of Bristol who have just set up their Institute of Digital Futures and are doing research into this space. So WARC did the qualitative research and Bristol conducted some interviews with some of the survey respondents to add the qualitative side of things. We surveyed more than 750 marketers at brands and agencies in North America, Europe and APAC, with the overall aim of finding out what current capabilities were in terms of martech and what their future plans were.
- I’m going to focus on four key takeaways from the research – I will show some charts, because it’s the best way to show the data, but I’ve tried my best not to make it death by bar chart!
- The first main headline from the research is that is showed that the martech ecosystem still has room for growth. You wouldn’t think so from the size those logos on the martech landscape – I remember using that landscape for companies to target, back in 2011 when I worked in recruitment into the adtech space - when there were around 150 companies on it. I think if I tried to do that now I’d get a migraine – but now I think you have to take it apart into distinct areas – some of which are definitely still growing.
- And despite the very definite feeling from some respondents that this volume of choice and diversity of providers was overwhelming, when we asked if they felt the martech ecosystem had reached capacity, more disagreed than agreed, indicating that there’s still appetite there from marketers for more tools.
- And what’s shown here is just that – only 24% of respondents this year feel they have all the martech tools that they need and fully utilise them. But what this chart also shows is how the response to this has changed year on year, which I think is a reflection of how quickly the industry innovates and changes. Probably you’d get different responses to this throughout the year too as new tech is launched.
- So all that growth is represented here as the market size figure that we calculate for the report. This figure is for the North America and the UK combined, and is now at 65.9bn – that’s more than a 25% increase since 2018. Now the survey does include respondents globally, but because this is such an important figure, we wanted to be sure we got it right, and the sample was biggest for North America and the UK so we stuck with those markets for the sizing. The calculation for this uses total marketing and martech spend given in the survey and also WARC’s adspend data – if you want more info on how we calculate come and grab me afterwards.
- And this shows what that growth looks like in the UK on the left and North America on the right. The question was what percentage of your overall marketing budget do you typically spend on marketing technology, and this is split between in-house in red and outsourced in grey on the chart. North America’s spend on martech as a proportion of marketing budget has risen significantly over the past three years – now at 30%.The UK on the other hand has not grown at the same rate and actually retracted by 1% in 2018. REASON For both regions, the split between in-house and outsourced technology is weighted slightly towards in-house, but this ratio is not showing a strong trend towards in-housing that has been talked about generally in the marketing world in the last couple of years - results indicate that brands are still looking for agency help and expertise.
- Like I said earlier the University of Bristol did some interviews of survey respondents as part of research they are doing but also to contribute to our report. This quote is taken from one of those interviews, talking about the role of agencies in working with martech. READ QUOTE And whether actually managing the technology or providing advice in a more consultative way, the feeling from respondents throughout the survey was that with the increasing complexity of the landscape, brands really need agencies – and tech vendors – to play an active role in tool selection and optimisation, as the frustration around inefficient use is really evident.
- And a large part of that frustration around not getting the full potential out of martech investment is around not having the right skill set internally to really optimise using the tool once it’s in. A lot of our respondents talked about the significant expense of buying some of the enterprise level tools, which they then use a tiny part of because they don’t have the skills or data or integration at the level they can use more of it. One of our interviewees likened it to buying a Ferarri and then leaving it on bricks at the side of the road.
- And though on the face of it, in the survey, 59% of respondents said they do have the skills and talent to capitalise, of respondents that said they had all the tools they needed, more than half said they don’t fully utilise those tools.
- And when we asked about the main barriers to martech investment, marketing budget constraints obviously came top – though survey results support the continuing growth of the martech market – just under half of marketers said they don’t have all the tools they need – a reflection probably of the ever increasing number of options available in the ecosystem, but also of the budget constraints they are under. but a lack of understanding and a lack of skills and talent were second and third. Both of these link back to that first point – another thing that came up a lot in the qual research was the struggle of getting board buy-in – which is essential for securing budget for further martech investment. It was clear that in the rush to buy and use tools, the time spent understanding, upskilling, using the tool and measuring its impact was sometimes lacking.
- So what talent is being prioritised ? This chart shows the top three skills that were ranked by client-side respondents – in red is the proportion that ranked each first, the blue second and the grey third. And you can see that brands rank creativity above all other skills, with strategy in second and cx in third. Bring in the agency comparison, and you see data is more of the priority, with creativity in the top 3 of only a quarter of agencies. But for both, strategy skills are in the top 3. We talk about strategy a lot at WARC, and in particular using data to inform strategy but not losing sight of creativity amongst all the data.
- Summarised by this quote from one of our interviewees. READ And in the context of martech, this means having clean data in the right format for your martech tools to use, but also knowing what the overall objectives are from using that tool and how it will be used as part of an overall marketing strategy. There was a sense that the pace of change within the martech ecosystem can cause organisations to chase the next tool to add to their stack, without knowing how it contributes to overall strategy or compliments what is already in place.
- There’s so much more that could be discussed in that area but in the interests of time let’s move on to the third takeaway that’s around using martech to optimise the customer experience.
- Customer experience is the complete set of connections and interactions that a customer has with a brand, both offline and online, and for 57% of the organisations we surveyed, it is a top priority. Effective CX strategies need proactive and reactive design that see the customer and commercial performance as one – and that’s a strategy that requires integration of both customer data, and importantly in a martech context - the technology that data powers. CLICK And when we asked how far they agreed that they have the technology in place to optimise the CX across most if not all channels and touchpoints, 73% agreed.
- This chart shows the technologies client-side respondents are using to optimise the customer experience, in grey are the 2018 results, and in red are this years’. Customer relationship management (CRM) technologies have overtaken social media management systems (SMMS) as the most-used tech, rising for a third consecutive year to 49% of respondents. I think that shows the importance of the personal relationship brands need to have with their customers in an era of such massive consumer choice, and therefore the need to have all that customer data in one place and target those consumers with really personal, contextual marketing messages. And the other thing to note there is the significant jumps this year in respondents selecting automation and emerging technologies like AI, and though you could probably argue that the majority of martech introduces a level of automation to processes, I think the continuing growth of the industry over the last couple of years has made awareness and integration of pure automation tools increase.
- That leads nicely onto the final trend, which is the future-looking piece of the research, which showed that the trend shown in that last chart, of increasing use of automation and AI will continue into the next few years.
- So we asked what respondents thought would present the most exciting opportunity in three years’ time. 27% selected marketing automation, 16% said machine learning and AI, and 14% said VR and AR. But you can tell by those low proportions that there was no runaway top choice, which is probably a reflection of the speed of change in this industry – that means predicting something 3 years into the future is a pretty difficult task.
- We’ve seen AI come up repeatedly in WARC research over the last year to two years, with marketers showing a lot of enthusiasm and intent to use AI, but we haven’t seen loads of actual use cases come out where it’s had a clear role in a campaign with really effective results. In this research, 25% of respondents said they were currently using AI tools and 30% planning them in the next 12 months. But that still leaves a significant minority that have no plans to use AI, which is proabably why it’s being seen as that future opportunity rather than a present one, and the quote on the screen sums up what quite a few of our interviewees said, that there is a lot of chat about AI but it’s not yet understood well enough for mainstream use.
- Know what you’re looking to achieve from bringing tools on board, and crucially how to measure how you’re going against those objectives. It’s also really important to know how these individual objectives play into the wider strategy. Invest in people and not just tech. We’re not yet living in a world where tech doesn‘t require human assistance and it’s clear from this research that having the skills to make tech work for your individual businesses is just as important as the tech itself. Data is the fuel to power martech – clean, structured, integrated data is the purest fuel – it’s pointless investing in tech if you don’t have the right fuel to make it work for you. Get board buy-in for further investment by going to the board with a clear story of the objectives behind a new tool, and as much evidence as possible of the effectiveness of martech investment to date. Use your agency’s expertise – with all the talk about in-housing, there can be a pressure to try to go it alone. But agencies have a wealth of expertise and can approach your needs from a more neutral standpoint. Utilise your agency’s expertise from a consultative or advisory standpoint – ask them to help you select which technology to use, and how to optimise its use, even if the martech still sits in-house.