Gartner: What it takes to create an effective martech stack

Analyst firm shares tips and tricks on how to ensure your marketing technology purchasing and ecosystem operates more impactfully

Marketing technology is expensive, ineffective and anyone using it will tell you it’s complicated. So how do you improve your chances of creating an effective martech stack?

That was the question Gartner senior director and analyst, Colin Reid, posed and attempted to answer during the recent Gartner US Marketing Symposium. According to the analyst firm’s recent CMO Spend survey, marketing technology represents the largest overall piece of the spending pie for CMOs at 26.2 per cent. This is ahead of paid media (24.8 per cent), labour costs (24.5 per cent), agencies and services costs (23.7 per cent).

Yet in the same survey, marketers reported millions in wasted spend on their martech stacks, with organisations of $US1 billion to $5bn revenue estimating they waste $62 million on martech alone.

To combat this waste, Reid outlined three key building blocks that better shore up your martech purchasing and ecosystem. The first block is recognising organisational capability.

“What are we able to do as an organisation? Do we have the people and expertise to do that? The analogy I default to is if you don’t have astronauts, don’t build a rocket ship as you won’t be able to fly it. However, if you do have astronauts, build four of them and you’ll build a massive competitive advantage,” Reid said.  

The second foundation to a more effective martech ecosystem is data. “Martech requires data to work. It’s the fuel that powers the engine,” Reid said. “Think about the data you have, where it is, how to access it, and work with the owners of the data around your company to leverage this for marketing.

“A common mistake we see is organisations think of this data work as a project with start and end date. That is incorrect. By using data you’re going to transform it, change it and create new data. As you engage on this journey, your successes will also encourage those around your company to give you access to new data sources. So as you consider the fuel you have to power your martech, make sure it’s an WIP and constantly being looked at, assessed and maximised for the opportunity.”

The third foundation for martech ecosystem decision-making is utilisation. “If we use martech, transform it and bring something else in, what is it going to do for our organisation? What is success and how do I measure that?” Reid asked.

“So many times, we find organisations don’t have this defined. To understand how martech drives your business and moves it forward, you need to understand your capabilities, available data and use cases for martech, so you can find your priorities and what to keep, cut and buy in respect to your organisation’s unique needs.”

Define utilisation

Diving into these further, Reid explained technology does not drive your business, your business will drive marketing technology. Therefore, linking how technology is used directly to business performance is vital.

“Your business will define what martech you have and how you use them. It has to be that way around for you to achieve those goals,” he said. “Look at your outcomes - what is it we’re achieving on quarterly basis first? This could be revenue growth, customer churn, unit sales or cross-sell / multi-product adoption. To do those, what are the capabilities we need and what functionality do we need to deliver that?

“Once you’ve done that, you will start to understand the technology you need to drive those outcomes and have insights into how to measure success.”

Capability

The best way to measure capability, meanwhile, is with a realistic assessment of maturity. Gartner does this through five stages of multi-channel marketing maturity: Nascent, developing, intermediate, advanced and master.

“I used to think as a CMO I needed to be at the top, a master. But to do this you need to take small steps and go through the levels,” Reid said. “And as you progress up the curve, look behind you. What is still there? What are the laggards or pinchpoints in your capabilities and processes? What are the repetitive tasks holding you back?

“It’s going to be equally transformative for your organisation to get rid of the pinch points, dead weight and anchors stopping you as it is to move forward. So with maturity, look in both directions.”

Review and highlight available data

In reviewing data, Reid said the key is to firstly be honest, and secondly, to connect it to the outcomes you’re looking for. “This gives you definition on the insights you need and decisions you need to make to drive those outcomes,” he said. “This leads to the type of data you need.

“The next question is do you have that data? As you look at outcomes, capabilities and start to understand the data you have, it leads you to the bottom of the pyramid of the technologies that could do that for your organisation.”  

Three-step roadmap

Reid also had three further steps to improving your martech roadmap approach. The first is to audit existing martech ecosystems.

“In our 2020 survey, only one in six have this in their processes. Yet you might have a tech capability doing something already,” Reid said. “Only 58 per cent of martech that’s licenced is utilised. Auditing will help uncover that. It will also help uncover if something else is coming in, and if it has to integrate with the rest of the ecosystem. In doing that, you will naturally uncover duplications, redundancies and shelfware.

“This allows you to plan forward, extend, find more efficiencies and opportunities for cost optimisation. We know organisations that do this at the start of the process struggle less with utilising martech.”

The second must is to accelerate the cadence of your planning, and the best way is by embracing agile, Reid said. Gartner’s survey shows only 5 per cent of people struggling with martech have agile planning, against 44 per cent with formalised roadmaps and 45 per cent with best-effort marketing.

Gartner’s Marketing Ops survey from September 2020 also shows agile has many other benefits to the organisation against traditional project approaches. These include a stronger ability to sense and respond to changes in the business context as they happen (81 per cent of agile-oriented teams versus 56 per cent using traditional project approaches); managing, prioritising and aligning marketing projects (81 per cent versus 65 per cent); and executing a project at or under projected timeframes (81 per cent versus 59 per cent).

The third must for Reid is putting someone senior in charge to ensure dedicated martech leadership. “Organisations that put a senior person in charge of martech have greater adoption and utilisation,” he said.

These martech project owners need to do four things: Define vision and strategy and be clear on what martech does and doesn’t do; build and present tech while working with those other parts of the organisation; conduct user research to test and refine; and identify emerging trends, Reid said.

Emerging martech

As to what technology is on its way, Reid highlighted 10 fast-moving technology categories on Gartner’s hype cycle that CMOs should be aware about. The list was as follows:

  • MDM (master data management) of customer data
  • Content migration
  • iPaas (integration platform-as-a-service) for data integration
  • Large-scale, pre-trained language models
  • Collaborative work management
  • Digital ethics
  • Consent and preference management
  • Speech recognition
  • Account-based marketing platforms
  • Price optimisation and management for B2B and B2C dynamic pricing

 

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