“How much should I budget for a MarTech acquisition?”
I have been getting this question quite a bit recently — so much so, that I have begun to formulate an answer that goes deeper than, “Well, probably more than last year.”
The fact of the matter is, you shouldn’t even begin to think about how much to budget until you’ve conducted a thorough MarTech assessment that also considers the following criteria: Impact, Usage, Adoption, and Integration.
This will lead you to the right technology to invest in, and then you can find a solution that fits your unique organizational needs and budget requirements.
How to assess your MarTech needs
First, it’s important to compile a list of which technologies you already have so you can more easily identify any gaps. Keep in mind, marketing might not own some of these technologies, but you can certainly join forces with the departments that do.
“Starting with a MarTech assessment helps you analyze where your gaps are
and what tools you need for building out the Demand Factory.
Then you can start thinking about where to make investments.”
– David Lewis, CEO, DemandGen
When assessing an organization’s MarTech needs, we like to use the following diagram so that everyone can see at a glance what exists and where there are holes:
Where are your gaps as they pertain to business needs and functional capabilities?
Once you’ve put what you have into this diagram, it should become very obvious where you need to invest before even thinking about actual dollar amounts.
A couple of important caveats:
- I bucket quite a few things into MarTech, but leave out most major media and event spends (e.g., existing PPC, banner advertising, event marketing). LinkedIn Sales Navigator? Yes. Google AdWords? No.
- In an excellent Chief Marketing Technologist blog post, Scott Brinker definitively states, “Marketing technology management is now a core marketing capability.” However, investment in any technology, let alone marketing technology, is not a great idea if you don’t have the right people to manage them.
Where are the biggest investments being made?
The general consensus is that there is going to be more spending on MarTech-related investments this year. However, marketing already oversees some form of technology spend as a baseline, so these growth numbers may start to flatline.
“Sixty-five percent of marketing organizations say they plan
to increase their spend on martech in the next year.”
– Walker Sands, State of Marketing Technology 2018
Target Marketing’s 2018 Marketing Technology Stack Investment Trends found that over 50% of the more than 300 marketers surveyed are increasing their investment in nine core technologies:
- Social media
- Web analytics/web design/web optimization
- Content marketing
- Database marketing/personalization
- Direct mail
- CRM marketing tech
“Martech will grow at nearly 10% compound annual growth
over the next five years.”
– Forrester, April 24, 2018
The Target Marketing study found that marketing leaders are sensitive to investing in the “leading- and bleeding-edge tools” of tech, but that is not what I hear from my clients. Yes, they are cautious about technology claiming to be the next best thing, but they are still willing to invest. Many have repeatable processes in place to properly pilot innovative solutions and platforms.
What is everyone else seeing in terms of technology investment? Where are you focusing your efforts this year and next? What about the equally necessary investment in people skills and training to ensure you get the most out of your new technology?
Interested in learning more about MarTech? Check out some of our online resources, including an episode of DemandGen Radio with Scott Brinker.
Will Waugh is a consultant for DemandGen focused on helping clients with demand generation, lead management and leveraging marketing technology. He genuinely believes that data can change the world. Follow him on Twitter. Other articles by Will Waugh: Account-Based Marketing: Is It Worth It?