BOOM! The explosion of marketing technology

BOOM! The explosion of marketing technology

Did you hear that noise? The sound of a new industry exploding into being? If not, you better listen up – because the marketing technologists are coming, and you need to be prepared for their arrival.

According to Venture Beat there are now 1,876 marketing technology vendors out in the big wide world, an increase of over 98.1% in the last 12 months alone. In 2012, there were only around 100 marketing technology vendors on the market.

Back in 2012, Gartner analyst Laura McLellan predicted that by 2017 CMO’s would spend more on IT than their CIO counterparts. At the time it was a bold statement to make, but only 3 years later you can see it rapidly coming to reality. Have a look at this graphic:

marketing technology landscapeIf you’re confused about this don’t worry – we’re confused too, and we’re the techies! Just what does this all mean if you work in marketing?

The ‘Lumascape’ is accelerating

Luma Partners, a New York based investment bank, create an ongoing series of what they call “Lumascapes” – which give an overview of the structure of markets, and the players within them. Often they highlight just how fragmented they are, and how far a client’s $ has to travel to reach the consumer.

This LUMAscape is a graphic collective of every marketing technology software vendor operating within our wonderful industry today.

What these graphics do above all is show the impact of tech – of digital disruption – to the marketing and advertising industry.

As detailed by John Kotter in the excellent book XLR8, the pace of change everywhere is accelerating. Stock market trades, patent registrations, startups are increasing at a faster and faster rate. This is mirrored in the furious pace of change in the world of marketing tech.

In January 2015, IDC said that marketing technology spend will reach $32.3B by 2018, a compound year on year growth of 12.4%. The overall spend between 2014 and 2018 is to reach $130B. There has been approximately $22B of investment in the sector to date.

To throw a few other players into the mix, tech startups are being brought in to the industry through ‘adtech’ meetups and brand led acceleration programmes. And this doesn’t even cover the increasing army of agencies, freelancers and consultants offering bespoke services.

Do you got the skills?

So, marketing is becoming more and more about the technology. It’s actually difficult to define where one starts and the other finishes. Therefore as a marketer the only way you can thrive in this technological world, is to get smart about tech.

Yet the pace of change will always outrun the rate at which people can learn about the change, let alone implement it. Just as you think you know the landscape, it goes and shifts all over again – a kaleidoscope world. Just what exactly in this explosion of tech will actually work to address your problems for your brand, today – and tomorrow?

This shift has big implications for the agencies tasked with helping brands navigate the world of the modern consumer. Saying you are ‘digital’ because you read Wired, skim Kickstarter, and employ a couple of front end developers just won’t cut it.

Are you experienced?

The impact of this accelerated digital disruption creates a range of changes, but key is how the economy is now all about the experience (as asserted by Gartner in this presentation).

This is the age of the ultra-impatient consumer. Your website takes a few extra seconds to download? Stuff you, I’m off to someone else. Can’t buy on mobile? Stuff you, I’m off to someone else. Can’t click and collect same day? …you get the idea. Our parents blame themselves when tech doesn’t do what they want. Millennials blame the brand.

Facebook recently completely re-engineered how it delivers video to make sure it would stream immediately with even an extremely slow data connection. Similarly, your brand delivers its promises based on software, built on machines. If you get that bit wrong…stuff you, I’m off to someone else.

Let’s take UBER for example, as they disrupted a market – taxis – that had been unchanged for decades. They did it by creating a digital service layer across this traditional ‘real world’ service, quite literally: software as a service. This is their sustainable competitive advantage, and it is built on slick user experience, smart software and mobile tech.

UBER are winning because they provide a better service (through technology) at a cheaper price. Their product IS their brand. Like Facebook, which despite their recent ad campaign, is built on technology and psychological insight not clever ad headlines.

As Marketing Technology blogger Scott Brinker says: “the experience they {the consumer} have – good or bad – may be instantly shared, resonating in search and social circles for all time.

This makes customer experiences the definition of our brand.”

So if you don’t know how to manage your technology, then you’re at risk of undermining your brand. Think your brand isn’t a tech brand? I bet the black cab drivers of London said the same thing 3 years ago.

Who are the smart young dudes in Silicon Valley coming to take your lunch?

Where is the divide?

In effect there is now no divide between Marketing and IT, because they are both about the customer experience. The argument is no longer Creatives vs. Coders or Art vs. Science. They are all part of the same skill set. Brands need someone to help join the dots. A marketing technologist.

marketing technology agency

As Ashu Garg, General Partner at Foundation Capital says: “Technology today is both friend and foe for the CMO. The shift from art to science requires CMOs to reinvent themselves and their organisations or become irrelevant. The CMO of tomorrow is the data nerd of today.”

Both marketing and IT need to come together to create awesome – and sustainable – customer experiences. But this needs to be built on customer insight – which means that the marketing department is more important than ever.

This ‘Big Bang’ of marketing technology is THE defining challenge for today’s marketing leaders. How you deal with it will underpin the success of your brand.

How are you building bridges in your company? What partners do you work with that can connect this divide? How could your industry be digitally disrupted to create a better experience for your customers?

We’d love to hear your thoughts and experiences in the comments below.

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