Martech luminary catches up with CMO to discuss martech bloat, utlisation, simplification and where technology is going next
Consolidation has largely defied the marketing technology ecosystem. For every acquisition and merger over the past 10-15 years, a plethora of fresh-faced players has sprung up, bringing disruption and new must-have martech categories with them.
But martech bloat, dissatisfaction with the status quo, a burning desire for simplification, skills shortages and ongoing economic pressure are leading us finally into an age of martech rationalisation.
That’s the view of martech luminary and HubSpot VP platform ecosystem, Scott Brinker, who caught up with CMO to discuss the state of play across martech right now and why more and more brands are finally beginning to rationalise their ecosystems.
As can be seen through the annual martech lumascape from Chiefmartech and MartechTribe, the number of marketing technology solutions available in 2022 swelled to more than 10,000 solutions. It’s creating a minefield of options for marketing teams to try and choose from.
According to Martech’s research, this is now resulting in more organisations looking to invest in alternative platforms and solutions. Marketing automation, CRM, SEO, email marketing and work/project management apps are among the most frequent to be replaced.
Yet just swapping one tech for another isn’t necessarily solving the problem. What Chiefmartech’s research also shows us is technology integration is rising as a key criterion in the martech decision-making process.
In this exclusive interview with CMO, Brinker talks about the rising martech ‘cancel culture’, where bloat is most commonly found when it comes to marketing technology, and where he sees the most impactful innovations coming into play.
CMO: Why do you believe we’re entering the age of ‘martech cancel culture’?
Scott Brinker (SB): There are couple of things going on here. The folks at MarTech over the past three years have run a yearly survey [Martech Replacement Survey] asking people if they’re thinking of swapping out their martech apps, and if so, what’s motivating them to do that. Once you do decide, the survey also asks what you’re looking for in the apps you’ll substitute with.
There are the things you’d expect – people looking for new features, or a better price. But the third thing last year was looking for better integrations. It makes sense – this is the perennial problem for people who have so much of this technology. In its own box, it sounds amazing, but how do I get all these things to connect? When the survey ran again this year, integration as a motivation to change jumped to second spot. I find that very interesting.
The fact is, the 2020s have not been kind to us. We’re just stepping out of the pandemic and uncertainty in the macro-economic climate hits. That’s a strong motivator for teams to review their martech stack to see if there are things they’re just not using, or maybe using but could achieve through another tool.
Such consolidation has defied the martech stack for a long time. It feels like we’re finally at a point where a variety of motivations are leading people to start to think about rationalising this. That’s why I think we’re starting to see a martech ‘cancel culture’ out there now.
Our 2022 State of CMO research also showed integration as a growing concern for marketing leaders. Besides cost, is this also a sign of maturity and realisation you can’t just keep growing your martech stack?
SB: Absolutely. For a while, martech stacks were definitely getting out of control. It wouldn’t have been unusual to go into a company and find 60 apps in the stack. So yes, part of this consolidation or rationalisation is driven by people needing to simplify operations.
Even if they cut their apps in half, you still end up with a company of a decent size, such as mid-market and up, where it’s very unlikely just one product is doing everything for them. They are going to have multiple products and other elements across the business, such as the data layer, they’re going to need to connect to. That’s where we’re seeing that integration discussion: Consolidate down to what are the essential capabilities we need, eliminate some redundancy, but then with the things that remain, really make sure the choices and investments are going to integrate. How well they integrate is now a first-class consideration in that buying criteria.
Gartner’s 2022 Martech Survey indicated the utilisation of martech capability has dropped significantly year-on-year. How do you read that in this context? Is it even a realistic benchmark for understanding the state of your martech stack?
SB: I always found utilisation a weird metric. Some products have so many capabilities, it is not necessarily a bad thing for a given business to use a certain number of capabilities because they work well in their organisations, but not use others as they’re not relevant. What struck me about that Gartner survey though was 57 per cent utilisation last year was down to 42 per cent this year. Even if you want to be generous about how to interpret this, it signals complexity of the stack has outstripped people’s ability to actually harness value out of it.
Where do you see the bloat? Are there particularly categories of martech you believe gained too much investment?
SB: It’s a great question. There are a variety of specialist and purpose-built tools. Things like products for dashboards – there was a time when there weren’t great dashboards out there and having a specialist product was helpful. Now, between what usually exists in core marketing platforms or the BI tools you might be using for other purposes, you could well be able to access adequate dashboards from other existing tools.
Another one closer to marketing is the content marketing category. Over the past 15 years we’re seen this explosion around content marketing, not just from a tech perspective but how companies figure out how to organise around this, and how production capabilities work. As a result, a bunch of specialised tools were created to help people manage production, scale and becoming a publisher.
There are still specialist tools, like a Descript tool to edit videos and podcasts, which are useful. But other things, like a specialist content calendar app, can probably be done through the marketing platform’s own calendaring mechanism. Or I might have a production management system, like Asana, and adapt that.
People are still willing to use specialist apps if they really do add net new capability or value. But other specialist apps have been absorbed into major products. You’re seeing people starting to let those slip away.
Are there new sets of categories driving further martech investment or excitement at this point? We’re talking a lot about CDP [customer data platforms], for example.
SB: If we look at more major categories, there are two things I’m really excited about. One relates to the CDP and whole data layer integration. It’s not just data organisation in martech, but how the martech world connects with the rest of the data layer across the company. There is so much innovation happening around cloud data warehouses, the fascinating concept of reverse CPL, and whether it’s part of what CDPs do or competes with CDPs. There’s also cool stuff for data modelling and management.
The other place I see innovation, which snuck up on me and a few people, is generative AI. For years people have been saying ‘AI’ but what they meant is a bit of machine learning helping you find the pattern, then predict and extrapolate an insight. Don’t get me wrong, it’s useful. But this is not a super intelligent thing, it was more about the math.
Over the past year, between GTP-3 [autoregressive] language model and Dall.E 2 image generation, we’re seeing variations of generative AI emerge. They’re not perfect yet, but they’re good enough they’re out of the science fair stage and you can see with another year or so of iteration, the ability for marketers to use them is coming.
Just think about personalisation: We have been talking about personalisation for 20 years in marketing. It’s still pretty primitive. If you now have truly generative AI that can take info about a target customer, access all your content, then custom write something specific for an individual… it’ll bring with it an interesting next stage for personalisation. We could wake up in a couple of years and see stuff dynamically optimised on the fly and not be able to tell what was crafted by a human or the AI. As the person responsible for content and using these AIs as an assistant power… I’m able to create work at five times the speed I’ve been able to do before. That’s not nothing.
How do you see the metaverse impacting the martech space?
SB: Generative AI is one example, when we get to a place where metaverses are common. When people were initially creating games, it was a very laborious effort to draw all the scenes and connect them. Now, you can describe the scenes you want, and the AI automatically generates those things for you. So you’ll absolutely see that kind of technology accelerate metaverse environments.
As to how quickly the metaverse environments are going to be a key channel for marketers… in the gaming markets this is very real and it’s working well. For scenarios outside of marketing, it’s not there yet.
Going back to the customer data side, we talk persistently about needing a single source of truth. Key to actioning data is the decisioning engine. For many, this is still largely a manual, integration job rather than an available tech capability. How do you see this aspect of customer data management evolving?
SB: When I look at what people are actually doing, ‘decisioning’ tends to fall into one of two use cases. One is marketing automation – as a human, I’ve designed for certain things to happen when people do this, and I evaluate criteria when people do that. Super useful but still for the most part relatively manual.
The other thing we see from a decisioning perspective is more about personalisation to date. It’s saying at this moment, I have to make a decision as to what offer or content I put in front of someone. I might be using machine learning prediction engines at this point in time to say based on what we know about the customer, this is what we recommend putting forth here. That’s useful too.
But I think what we’re aspiring for – and I don’t know when we’ll get there – is something more automated and integrated, making choices about how these flows should evolve, rather than having humans craft that. We want to start to get to a place where there is a true AI decision engine that’s not just focused on individual offers or moments, but actually starting to think across journeys.
Where other stumbling blocks are you seeing prevent better martech adoption and use?
SB: Again, it comes back to the perennial challenge we underestimate, and part of what’s behind martech cancel culture. It’s always been 10 per cent about the tech, 90 per cent about people, training, the organisation and strategy. That stuff is hard and doesn’t change quickly. Many folks bought a bunch of tech and into its promise. Yet if you don’t have enough in the way of developing org capital to harness it, you’re just going to be able to tap into it well. The martech in theory could do these amazing things, but if I don’t have the people to orchestrate what we do with it, why am I paying for it at this point?
It's a hard line for people to walk. I’m biased on this, but one of the reasons I believe strongly in platforms like HubSpot or Salesforce is you’re getting to a place where hopefully you’re getting the best of both worlds. On the one hand, you have a platform providing cohesion at the centre of the stack and a common record… But there’s also been great progress made by these platforms by opening up APIs, invested in creating marketplaces and partner programs that recognises there may be a special thing these companies from here or there. If you have a partner universe with all these specialisations, and the platform company does the hard work behind the scenes to plug them in better so the poor marketer doesn’t have to figure out how to attach wire A to platform B, then that’s where there’s useful convergence.
You can also 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
In the third and final episode of our 3-part CMO50 video series exploring modern marketing and why it’s become a matter of trust, we’re delighted to be joined by Telstra’s former CMO and now digital services and sales executive, Jeremy Nicholas, and Adobe VP Marketing Asia-Pacific and Japan, Duncan Egan.
Flash back to the classic film, Willy Wonka and the Chocolate Factory. Television-obsessed Mike insists on becoming the first person to be ‘sent by Wonkavision’, dematerialising on one end, pixel by pixel, and materialising in another space. His cinematic dreams are realised thanks to rash decisions as he is shrunken down to fit the digital universe, followed by a trip to the taffy puller to return to normal size.
Why is it there is no shortage of leadership development materials, yet outstanding leadership is so rare? Despite having access to so many leadership principles, tools, systems and processes, why is it so hard to develop and improve as a leader?
As a nation united by sport, brands are beginning to learn money alone won’t talk without aligned values and action. If recent events with major leagues and their players have shown us anything, it’s the next generation of athletes are standing by what they believe in – and they won’t let their values be superseded by money.
