By Guest author Jason Katz
9,000+ Software Solutions.
$65B Funding. [1] 70+ Average Stack Size. [2] Budget at ~10% Company Revenue aka Tens or Hundreds of Millions. [3] 500,000 Agencies Worldwide. [4] At this level of Marketing Technology (“MarTech investment”), there is a great opportunity for governance. Awareness has boomed with organizations like Chiefmartec, CDP Institute, CabinetM, and Investors like Salesforce Ventures, Accel Partners, Y Combinator, Battery Ventures, Sequoia Capital, etc. [5] An increasing number of dedicated MarTech teams are forming in Fortune 500, Russell 2000, and Series C/D companies. And there are 1,000+ open job postings for dedicated MarTech roles on any given day. Momentum is building fast and should only get faster with the booming ecosystem and market factors like M&A, startups, and general disruption.
As a proponent and/or leader of MarTech governance in your organization, there are great opportunities to orchestrate its realization along with its substantial benefits. Below are seven common stages of MarTech governance that can be applied broadly.
Take Inventory
In companies that incubate, merge, and/or acquire new divisions, there an be hundreds of software solutions with active contracts many of which are duplicative. Creating an inventory is crucial. Since the list is dynamic with so many software solutions, factors to track, and change, a solution like CabinetM can be helpful as it’s built from the marketer’s perspective to deal with all these considerations. At a single company, there were 7 different email providers, 24 if you count homegrown services. This is a regular occurrence, more common than you’d ever imagine. The other surprise is that many contracts are multi year to get the “discount”. Once your inventory is complete, there will be sticker shock for the total value of active contracts which easily clears tens of millions. Then it’s time to go out for a drink with your partners in Finance and Procurement as well as the CMO and CTO who will be very motivated to understand the current state and support efforts toward a better future state.
Turf Wars
The MarTech stack de-duplication and rationalization exercise will begin before you even know it started because of executive focus on the amount of resources the company can potentially save. There are at least three scenarios to navigate:
Forgotten Software: The forgotten software with no active users will be easy to terminate without much fuss. These vendors should have already offered if they have good governance. Either way, enjoy these quick wins.
Duplicative / Insufficient ROI: The tougher ones include the duplicative software as well as insufficient ROI and/or strategic relevance. For duplicative software, there are usually different stakeholders who value each software solution differently and will passionately fight to keep theirs. These decisions will be tough but they must be made. The best scenario is you can build relationships with the stakeholders in the process. When removing software without replacement, you’ll need to make the case that the benefit e.g. cost saving, website performance speed, etc... is greater than benefit of keeping it. This is much trickier and likely involves executive-level intervention, and sometimes proofs-of-concept of professional life without it.
Tap Into Unused Functionality: There is also a creative approach of potentially finding and leveraging unused functionality of some existing vendors to replace others. At one company, ~50 different email journeys were active using a primary marketing cloud. The general manager of one of the divisions wanted to accelerate preparation for increased native app mobile marketing. Rather than migrate all ~50 journeys to a new mobile-first vendor, turns out the marketing cloud had what seemed to be a robust native app mobile marketing service with SDK. So we decided to run a test to leverage that functionality. If it performed well, it would be much easier to insert some native app mobile messaging into the existing ~50 journeys rather than rebuilding them entirely from scratch, dealing with full-blown RFP, as well as navigating all the data engineering and template design work that would be needed for a migration.
Renegotiate
For the potential surviving vendor candidates, many contracts have never been scrutinized sufficiently and need to be restructured. This is a great time for RFPs to learn about the latest capabilities, roadmaps, pricing, customer support, and more. Your objective is to re-set expectations and get adjusted pricing toward market-competitive levels. These conversations usually aren’t easy; but with a good RFP and planning, you’ll get the best outcomes. At one of the global brands, we saved millions in recurring annual expenses following these very steps.
Building for the Future
The greatest potential wins are from building the marketing machine that will support core business strategies and objectives. The machine will use the surviving vendors and homegrown data & systems infrastructure. Current data availability, including organization, format, and latency should be audited. The “brain” will require a single company wide unique identifier, data-broker that integrates all component systems, and data science engine where models and rules can be run. All other components like cross-channel messaging, CRM, prospecting, paid ads, attribution, etc... will plug in. While working at a startup, we had a requirement to build a customer data platform across all connected devices including game consoles like XBox and PlayStation as well as streaming players like Roku and Chromecast. Using that cross-device data, we would predict customer lifetime value. There weren’t and still aren’t any MarTech vendors who can handle this request easily so with a talented engineering team we built it from scratch. We then plugged it into the rest of the AdTech ecosystem to leverage first party data for media buying.
Legacy Systems
Legacy systems will need to be navigated, either re-platformed or integrated in a scaleable way. At another global company, there was a sophisticated direct marketing database with precise data and targeting that drove the most profitable business growth; but, partner channels which had some of the best prospective customer access at best economics lacked all of that great precision. We worked on a project to point that direct marketing database to partner channels for real-time serving to create a DMP + Ad Server combo capability before those capabilities were commercialized by marketing cloud vendors. We built it scaleably so it could be rolled out to many different partners. At another company, webstacks were re-platformed every couple of years but never run to completion while web analytics components were rolled out so it felt like one single site. Every company has different systems and considerations that should be factored into the MarTech stack and machine.
Ongoing Management
Your MarTech stack is a function of business strategy and objectives which can change often, sometimes annually, quarterly, or faster if a competitor makes a substantial move. So the MarTech roadmap should be calibrated at that same frequency using the same steps as above which will be relatively easier after the initial reset. As changes are needed, the team should execute together. This ongoing management can be facilitated by a dynamic multi-user MarTech inventory and management tool like CabinetM.
The Team
With so many steps and dependencies, MarTech governance is a complex riddle that requires a strong team and executive sponsorship. The team should include key players from Marketing and Technology teams, the expected power users of systems, and vendor partners who are hungry for mutual success. Executive sponsors must include CMO, CTO, and ideally CEO. The full roadmap inclusive of all the MarTech governance steps above should be fully blessed by this group at every milestone.
Dedicating your company to these seven stages of MarTech governance will help you get the best ROI from your MarTech stack. Happy Governing!
Jason Katz is a recognized expert in Product Marketing, Marketing Technology, and Growth Marketing across B2C and B2B. He is Founder of Growth Marketing Advisors LLC and has served as Marketing Leader in Technology, Marketing & Advertising, Ecommerce, Entertainment, Health, Financial Services in startups and global brands like American Express, Shutterstock, Curious George & Carmen Sandiego (HMH), and Criteo.
[1] CabinetM cites 12,000; Chiefmartec “Marketing Technology Landscape Supergraphic (2018): Martech 5000 (actually 6,829)” By Scott Brinker (with Anand Thaker) April 25, 2018
[2] Growth Marketing Advisors browsing sites with Ghostery; LinkedIn Slideshare “The Stackies 2018: Marketing Tech Stack Awards” By Scott Brinker April 27, 2018; LinkedIn Slideshare “Insights from Inside the Marketing Stack” By Anita Brearton with Mark Pickett May 8, 2017
[3] Forbes “How Does Your Marketing Budget Grow? -- Key Trends From The CMO Survey” By Christine Moorman September 27, 2018
[4] Quora “How many ad agencies are in the US?” By Brian Regienczuk (CEO at Agency Spotter) Apr 22, 2014
[5] MarTech Advisor “Annual InvestScape 2017: Decoding the $8.8 billion Invested in MarTech in 2017” By Khushbu Verma January 23, 2018