Report: Martech acquisition has grown 22 per cent in the last year

Martech budgets are increasing across the board, driven by the consumer appetite for digital technology

Martech acquisition has grown 22 per cent last year, according to a global report, to be worth more than US$121 billion. However, there are concerns the concentration on data is coming at the expense of creativity.

Martech: 2020 and Beyond, conducted by Warc and BDO, surveyed 750 brands and agencies across the US, UK, Europe and APAC, to examine the health of the marketing technology industry. The report found martech budgets are increasing across the board, driven by the consumer appetite for digital technology. The combined market size of martech in North America and the UK is $65.9 billion for 2019, up from $52.4 billion in 2018. Extrapolating this to a global level, the report estimated worldwide martech spending has tipped over $121 billion.

On average, brands in North America and the UK are spending 26 per cent of their budgets on martech compared to 23 per cent last year, a 13 per cent increase in martech budgets. Globally, an average increase of 12 per cent in martech budgets is predicted over the next year, with six per cent of brands expecting increases of more than 25 per cent in their martech budgets.

For brands, the report said with just over half of the spend going on in-house technology, brands will need to work hard on tech integration and upskilling their staff to ensure they are getting maximum effectiveness from their spend.

The majority of martech is being used by brands on email (79 per cent), social media (77 per cent) and content management (68 per cent), with only 46 per cent using it for experience optimisation. However, 30 per cent of brand plans to use martech for this function in the future.

Around 34 per cent of global respondents feel they don’t have all the martech they need as yet, but fully use what they do have; while 31 per cent say they have all the tools they need but don’t fully utilise them. In APAC, the latter figure is 38 per cent.

When it comes to providers, only 22 per cent use just one. Most (48 per cent) use one for the majority of tasks, but plug in specialist providers on some projects. Given the plethora of martech providers, it is little wonder why since last year there has been a 24 per cent reduction in marketers who use just one tech provider for the entire stack.

The report sounded a warning to brands that they need to be wary of prioritising the onboarding of new tools in favour of fully utilising older ones.

"To ensure the return on investment of martech, brands need to focus on the full integration of existing tech, ensuring buy-in and support for upskilling staff," the report stated. 

About 68 per cent of brands and 83 per cent of agencies have seen an increased need for data skills associated with the use of marketing technology. Globally, a total of 59 per cent of brands agree they have the skills they need to capitalise on martech and 21 per cent strongly agreed.

However, half of client-side respondents feel there is too much focus on data and technology causing a decline in creativity, and 46 per cent of agencies feel the same. The most common priority for brands when hiring for the marketing function was creativity (49 per cent), and it is the top priority by 21 per cent.

“Creativity is one of the most important skills when hiring into the marketing function. However, agencies continue to emphasise the need for improved data skills associated with the use of marketing technology, ranking data literacy above creativity when hiring into the marketing function," the report said. "The net result is a need to use data to guide creative strategy, and not become bogged down in the numbers. Effectiveness needs to be the objective, rather than the short-term efficiency that can be achieved through a focus purely on data.”

While CX was important to 96 per cent of the brands surveyed, less than 50 per cent of the client-side respondents to the survey are using martech to track customers between channels including offline to online, but 73 per cent feel they have the technology in place to optimise the customer experience across most if not all channels and touchpoints.

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 per cent of respondents.

Technology and media partner, M&A, at BDO, Damian Ryan, said: “The results point towards a need for some brands to slow down their acquisition of new tools in favour of fully integrating and utilising existing tools and the need to retain creativity in marketing strategies in the face of the volume of tech and data available.”

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
cmo-xs-promo

Latest Videos

More Videos

Great read. I agree that it should be a perfect balance between interacting with your customers and knowing your brand. As a business, yo...

Caroline Scott

7 ways CMOs can improve their customer engagement game

Read more

Very true. Team development helps improve collaboration among the team members. I was able to improve my team's collaboration skills by t...

Quent Sinder

Why empowering others can help make you a great leader

Read more

CRM is a very good software that can help you succeed in your business. In my company, this system has allowed me to improve customer rel...

Anna Janicka

Sensis rebrands to Thryv and brings business software to Australian SMBs

Read more

AI Leasing Assistants have finally arrived for the multifamily industry. With so many to choose from it can be hard to figure out which i...

Alice Labs Pte. Ltd.

CMO's top 8 martech stories for the week - 6 May 2021

Read more

Nowadays, when everything is being done online, it is good to know that someone is trying to make an improvement. As a company, you are o...

Marcus

10 lessons Telstra has learnt through its T22 transformation

Read more

Blog Posts

Unboxing 101 - How savvy influencer engagement can build a brand

The humble unboxing video is a powerful tool. Correctly executed, it harnesses consumer fandom, viral authenticity and brand design magic to deliver a high-impact message to a tightly targeted cohort of consumers.

Gali Arnon

Chief marketing officer, Fiverr

​Power to the people

Purpose is the ultimate statement of intent for many organisations. Why are we here? What are we trying to achieve?

Rich Curtis

CEO, FutureBrand A/NZ

The playbook to develop strategic brand moats

Warren Buffet is an unlikely ally for marketers. But his belief businesses need strategic moats that increase their value in the market while acting as barriers to competitors can offer marketers a new playbook for brand building and driving growth.

Fabian Di Marco

Founder and managing director, Tzu & Co

Sign in