What Does the Changing Martech/Adtech Landscape Mean for Marketers?
The end of the year always puts me in a reflective mood. Being a product guy, my first thought is to look back at the developments and progress we’ve made with our offerings as a company. To understand how successful we’ve been, I like to evaluate this against how well we’ve met, and continue to meet, the needs of our clients – both today’s and tomorrow’s. What will tomorrow’s challenge be? Truth is, this is not my first rodeo and I’ve seen a lot of change since I’ve been in the world of marketing technology, but nothing like the changes I’ve seen recently in the marketing technology (martech) and advertising technology (adtech) space.
Given our fast-changing market dynamics, let’s first ask: what is the real difference between the two? Jake Sorofman, research vice president at Gartner, sees it this way, “Ad tech targets anonymous audiences, while marketing tech generally targets known customers.” Martech, in general, grew from firms and people leveraging traditional database marketing methods into new, exciting channels like digital and social to build multichannel insights and targeting solutions. Adtech sprang from the new technologies needed to market effectively, and at scale, in the fantastic new digital channels available to consumers.
The fuel behind both of these marketing engines is consumer data, albeit in different forms. In fact, today more companies are leveraging more data with more analytics and technology than at any time in history. Chiefmartec.com’s 2016 Marketing Technology Landscape (below) lists 3,874 marketing solutions representing about 3,500 companies delivering various components of the marketing technology stack. That’s up from 150 only 5 years ago, and an 87% growth over 2015. That is simply phenomenal growth in the martech space.
Adtech is growing as well. According to Auren Hoffman, CEO of SafeGraph and former CEO of LiveRamp, adtech is still one of the fastest growing segments on the internet – and he believes this will continue to 2016 and beyond.
So you could say we live in interesting times. Not only is the number of solutions and companies trying to improve targeting and messaging exploding, all those companies are seeking the lofty goal of blending both worlds – marketing and advertising – to offer much better messaging, targeting, and delivery. The lines between adtech and martech are blurring more each day, and some pundits believe we’re close to a time when there aren’t many – if any – pure play solutions left. DSPs and DMPs are expanding into martech through acquisition and the addition of new data driven solutions for improved targeting in areas like programmatic ad buying, while martech firms like marketing service providers (MSP) Acxiom and Salesforce are expanding into the DMP space through acquisitions. In fact, almost every martech player is looking for, and finding, ways to provide the reach of adtech with the precision of martech.
Outside of the ~5000 companies with solutions in the martech space, and their employees of course, does all of this really matter? Of course it does. Better marketing certainly matters to every consumer fed up with misguided or mistimed messages that clutter their inbox or take up real estate on their tablet, phone, or laptop screen. The big winner out of all this company consolidation and solution explosion is the consumer who wants a personalized message and/or offer no matter what channel he or she is using – email, social, digital, or direct mail. This requires brands to craft well-planned customer journeys, even better if they are personalized. A personalized consumer buyer journey not only helps your sales and retention (some see improvements of over 60%) – it delivers a much more efficient experience for every consumer you touch. And let’s be honest – it’s much more fun to experience as well.
The big winner out of all this company consolidation and solution explosion is the consumer who wants a personalized message and/or offer no matter what channel he or she is using.
What’s driving this blurring of the lines is simple – it’s the people in the crowd. Marketing matters to people, but it’s much more important to realize that people matter to marketing. Adtech firms understand they can’t continue to offer targeting based solely on clicks and cookies. They need the people who are either customers of brands or people who look like them. Martech firm solutions are seriously limited unless they expand to include digital and social channels, and integrate their targeting with clicks, cookies, and social ids.
Companies that “get” that point build their solutions around the ability to link identities across channels. Some firms, like Oracle and Acxiom, have recently released enhancements to their identity resolution solutions that bring greater scale and capability to that part of the problem. Their solutions blend offline and digital data with a focus on cross-channel or cross-device identification and attribution. Their solutions are excellent for connecting siloed first party data at scale, linking it to third party data, and as a foundation for enterprise level data integration efforts.
But there are gaps in those powerful solutions.
One gap is social. Hootsuite recently released a Harris Poll study that found half of all Americans (48%) have interacted with companies or organizations on at least one of their social platforms. 41% of Americans say it is important to them that companies they do business with have a strong social presence. However recognizing people across social channels is difficult to resolve, and remains a challenge to even the largest identity resolution companies.
The problem lies in the need for a massive social graph. Without connections and social IDs linked together at scale, it’s impossible to support the analysis and insights necessary to understand people and their actions on social media. SpotRight is one firm that understands this and has focused on resolving identities at scale in both the social space and the offline world.
SpotRights’ GraphMassive database grows daily with over 40 billion connections between consumers and brands representing nearly a hundred million maintained consumer profiles, over 30 million of which are linked to their offline behaviors, locations, characteristics, and interests. This powerful collection enables marketers to understand people, like those who buy their products, or those who don’t today but may in the future, and craft people focused marketing campaigns for all of them.
The exciting thing about this is that it is possible to blend more, if not all, channels in your marketing efforts. In 1992 Bill Clinton swept to office by focusing on one thing, the economy. “It’s the economy, stupid,” became the campaign’s rallying cry. Today, for us marketers, the path to better marketing is just as straightforward. Yes, it’s the people, fellow marketer!
All this looking at a landscape that is exploding and consolidating at the same time makes me want to open my old Physics textbooks and see if I can find some clues about how this will go in the future. After all, even NASA has found the universe is expanding faster than expected, not unlike our industry. Is this a cosmic trend? I won’t attempt to answer such a lofty question, but in my next posts I will address what I believe this will mean for marketers in the near term. Stay tuned!