GroupM economist: Ignore martech and adtech at your peril

Media agency's economist in residence shares his views on the impact of marketing technology on the media and marketing industry and where things are headed

Agency and industry players who haven’t yet grasped how important marketing and advertising software systems are in the industry’s long-term future risk falling into the same trap their predecessors did when they failed to recognise digital’s significance.

That’s the view of GroupM global president of business intelligence and economist in residence, Brian Wieser, who has been on Australian shores this week sharing his views on health and wellbeing of the marketing, media and advertising industry.

According to his findings, martech and adtech software currently represents about US$100 billion of the total $1.5-$2 trillion marketing and advertising industry globally, leaving significant room for growth. Bigger contributors include advertising (about $700 billion), services ($150 billion) and ‘other marketing’ such as data, partner support, events, activations and sponsorships ($700 billion).

“Not understanding marketing tech as a media CEO or client, is equivalent to not understanding digital 20 years ago. You’re fine that year, or a few years out… but by the time you’re 15 years out, you’re in trouble,” Wieser told attendees at a GroupM event this week. “If you take this as the software layer of the industry, and if you believe in the premise software is eating up all industries, or that everything that can have technology applied to it will… we’re only at $100bn. There’s a lot of room to grow.

“It’s a solid teens growth space and it’s going to keep growing a rapid pace for a long time. That’s because software is still so small and there’s so still much opportunity for marketing technology to be applied to our broader industry.”  

For one, all the sources of data on customers and prospects and finding points of consumer contact where you can connect should be tying more and more into media, Wieser said.

Balancing this view at the AANA Reset event the day before, Wieser disagreed with Gartner figures that martech is now 29 per cent of a marketer’s total budget, suggesting it was more likely to be under 20 per cent. Yet at the same time, he argued holding companies and agencies haven’t invest enough as a sector in martech and as a result, lost some ground to consulting giants who have.

“A few consulting groups – Accenture, Deloitte – are being aggressive in their efforts to come into this space. I’d say WPP more than most agencies has invested here, but we are seeing agencies have some presence in IT services,” Wieser said. “It’s not a one-year game, it’s multi-year effort.”  

To counterbalance this, Wieser agreed agency and industry maturity around martech and adtech can vary by region or geography. Yet he also saw a lack of integration of the two as well.

“I don’t get sense there’s urgency to bring martech and media together more tightly,” he added. “Which is OK – if you’re the client who decides to find ways to take advantage of it now, you win. Good for those who do.”

As for rising investments into data across marketing teams and agencies, Wieser described it ultimately as an important operational element helping the industry “make less bad choices”.  

“Data helps you find the least bad alternative,” Wieser said. “Think about TV planning: 15 years ago, TV schedules were picked by buyers and we had MRI self-reported data. Now with set-top boxes, we can match data against other data sets and identify preferred programs to ask sellers to place ads against. You can automate more and more.

“It’s the least bad alternative concept. Data just helps us get there. For all data being used in advertising let alone the economy, it doesn’t cause change in overall trajectory of growth. It’s just an operational element - an important one - that helps us make less bad choices.”

Business consistency

Wieser also commented on wider business investments and in particular, short-term versus long-term investor community focus. He noted brands with a consistency of view are more likely to gain investors willing to support them for the long haul.

In his own in-depth research into Amazon’s financial reports, for example, Wieser said consistency of view and brand ambition had always been there.

“Amazon has stuck to this view, which most other companies do not do. There might be short-term consequences, but over time you build a constituency of shareholders who buy into the view,” Wieser said. “As long as you’re delivering against it over whatever timeframe you promised to, investors will be wilfully optimistic.”  

This need for consistency also came through Wieser’s response to the question of whether marketing has become too overcomplicated.

“Sometimes things need to be complicated and there’s no way around it. The bigger point is companies are often inconsistent when they need to be consistent,” he said. “If you are consistent, you will crush the competition.

“Too many companies respond to the vagaries of the market or whatever they just heard, or where they think they need to be based on what people think they should be doing. They don’t stick to their true vision of where they need to go.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia. 

 

 

 

 

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Latest Videos

Conversations over a cuppa with CMO: ABC's Leisa Bacon

In this episode of Conversations over a Cuppa with CMO, ABC's director of audiences, Leisa Bacon, shares how she's navigated the COVID-19 crisis, the milestones and adaptability it's ushered in, and what sustained lessons there are for marketers as we start to recover.

More Videos

Very insightful. Executive leaders can let middle managers decide on the best course of action for the business and once these plans are ...

Abi TCA

CMOs: Let middle managers lead radical innovation

Read more

One failing brand tying up with another failing brand!

Realist

Binge and The Iconic launch Inactivewear clothing line

Read more

I am 56 years old and was diagnosed with Parkinson's disease after four years of decreasing mobility to the point of having family dress ...

Nancy Tunick

The personal digital approach that's helping Vision RT ride out the crisis

Read more

I am 57 and diagnosed in June 2009. I had a very long list of symptoms, some of which were. Keeping right arm close to my side while walk...

Nancy Tunick

Gartner survey: CMO spending hit by COVID-19

Read more

Audible did such a great job on their marketing and at the same time, there are no false promises. The support, quality, variety all good...

Vitaliy Lano

Audible's brand plan to build the value of audiobooks

Read more

Blog Posts

MYOD Dataset: Building a DAM

In my first article in this MYOD [Make Your Organisation Data-Driven] series, I articulated a one-line approach to successfully injecting data into your organisation’s DNA: Using a Dataset -> Skillset -> Mindset framework. This will take your people and processes on a journey to data actualisation.

Kshira Saagar

Group director of data science, Global Fashion Group

Business quiet? Now is the time to review your owned assets

For businesses and advertiser categories currently experiencing a slowdown in consumer activity, now is the optimal time to get started on projects that have been of high importance, but low urgency.

Olia Krivtchoun

CX discipline leader, Spark Foundry

Bottoms up: Lockdown lessons for an inverted marketing world

The effects of the coronavirus slammed the brakes on retail sales in pubs, clubs and restaurants. Fever-Tree’s Australia GM Andy Gaunt explains what they have learnt from some tricky months of trading

Andy Gaunt

General manager, Fever-Tree Australia and New Zealand

Sign in