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“B2B marketers will reduce their tech stacks,” writes Bonnie Crater in her recent article MarketingProfs Top 3 B2B Marketing Predictions for 2022.
I couldn’t agree more.
She writes, “B2B marketers will look for opportunities to consolidate and simplify their technology stacks, reducing the number of solutions they use to more manageable levels.” This has been a recurring theme in discussions with our clients, particularly during the pandemic, which has not only put pressure on business results, but also on their ability to respond quickly and consistently to changing customer behaviors and needs. clients.
Clients upon clients wondered aloud how their sprawling martech stack got to its current state, which can best be described as a Frankenstein’s monster.
When there was only one choice
It’s easy to understand how so many companies have found themselves in such a predicament. I remember brands in the 2000s having discussions about best vendor versus sole vendor. But this discussion was kind of a joke because single-vendor options were expensive, feature-limited, and poorly integrated (mostly because single-vendors were just a loose set of standalone solutions they had acquired).
Over the next decade, the most successful approach ruled without a doubt. And during this time, the number of solutions has increased rapidly. As Crater reminds us, the number of martech solutions available has grown from around 150 in 2008 to more than 8,000 today, according to The Chief Marketing Technologist blog.
But there are not only more solutions, there are more types of solutions needed. So the martech stack is not only more diverse but also much, much bigger.
The rising cost of a best-of-breed approach
The combination of diversity and size has resulted in a growing number of unique solution providers. And if you look beyond the short-term costs that show up on purchase orders, the long-term costs of the best-performing approach have skyrocketed and become more apparent, albeit inconsistently measured.
The biggest long-term costs of best-of-breed:
- Relationship management. Every vendor your business uses is another you need to manage, track, and negotiate for renewal. These costs are felt, but rarely calculated.
- Knowledge management platform. The more systems you have, the harder it is to hire and train your team to use those systems, and the more disastrous it becomes when a member of your team leaves. The Great Resignation intensified this pain.
- Integration costs and management. Onboarding costs are usually factored in up front, especially when they skyrocket or spiral out of control due to positive reviews from implementing partners. However, IT departments also have to constantly manage APIs and deal with the potential cascade of consequences when one of your platforms changes something.
- Integration limits. When cross-channel and cross-department integrations aren’t seamless and real-time, it results in disjointed customer experiences and missed opportunities. The opportunity costs of these CX failures rise as more successful companies deliver great omnichannel experiences and raise consumer expectations of how things should be.
While smaller companies with smaller martech stacks feel these cost issues less, larger companies and enterprises feel them keenly.
A third option: Best-of-Suite
The best vendor versus single vendor argument has always been a false choice, but now it is a false choice because there is a third approach to building a martech stack: the best of the sequel. It’s essentially a balanced approach, where the core of your stack comes from a single vendor that offers a suite of truly integrated solutions, of which there are several viable choices, and that core is complemented by critical solutions from point.
The word “critical” is the key to being faithful to a best-of-suite approach. If your suite provider has a desired feature, you need to make a very compelling case for using an outside provider, because you compromise the benefits of this approach and risk falling back on Frankenstein’s best monster.
Even though the big resignation highlights the knowledge management risks of the platform, the integration and opportunity costs drive the move to the best of the suite. According to 2020, 59% of CMOs are looking to buy a more integrated martech platform Gartner research— a peak of 30% compared to 2019.
But even with all the momentum behind the best-of-suite, it may be difficult for some to embrace such a market shift.
For example, I recently heard an RFP consultant claim that point solution vendors are superior to suite vendors because the latter spends part of their development budget on integration, while the former invests almost exclusively in solution features.
While it’s fair to say that many innovations come from small point-solution vendors, it’s foolish to suggest that investments in integration are somehow wasted. The money will be spent on integration in both directions; it’s just a matter of who and when and at what level of risk. Suite vendors bear these costs and significantly reduce the risk, while point solution vendors pass most of these costs and risks on to their customers.
I heard this same kind of short-sighted reasoning in the early 2010s, when conglomerates and multinationals were standardizing their tech stacks across functional and geographic divisions. Each division loved its unique pet solution and claimed its needs were “unique and special” – in an effort to justify the bloat and higher management and licensing costs. Again and again they lost these battles and the solutions were standardized; the result was that parent companies realized huge cost savings and reduced management headaches.
While this wave of standardization was mostly about internal efficiency, the current wave of martech stack rationalization is mostly about external efficiency, i.e. quality of customer experience. Disjointed martech stacks lead to disjointed customer experiences, and fewer and fewer companies can afford that in today’s competitive environment.
More Martech Resources
Five Tips for Choosing the Perfect Martech Stack
Five reasons why marketing orchestration, powered by the right tech stack, is critical to executing your strategy
Martech Solutions Marketers Can’t Live Without