According to the Gartner CMO Spend Survey 2018-19, marketing technology (martech) now accounts for a whopping 29% of total marketing expense budgets. This shows marketers’ continued commitment to investing in the tools, talent and processes needed to compete effectively.
Overall marketing budgets in 2018-19 are relatively flat compared to last year. In that type of environment, when one investment area goes up, another must fall. Labor expenses fell from 28% in 2017-18 to 24% of marketing expense budgets in 2018-19.
Martech is not replacing talent
While it’s tempting to say that recent growth of martech budgets arrives at the expense of people and their jobs, the story is more complex than that. According to Gartner CMO Spend Survey lead analyst Ewan McIntyre, it’s more accurate to conclude this shift in marketing spend indicates that organizations are dealing with capabilities, resources and talent in increasingly complex ways.
A significant share of the martech budget is currently allocated to supporting services, with more than one-third of this investment going toward external services or internal charges to IT partners. These service-related resources and talent are then intricately split across different providers spanning traditional agencies, consultants, in-house experts and many other players.
What to do next
While technology powers marketing operations and fuels competitive advantage, there is still redundancy and underutilization within martech. Marketing teams often maintain multiple solutions in one category of martech spend. Marketers also report using two or more solutions on average for digital marketing analytics and multitouch attribution, according to the Gartner 2016 Marketing Technology Survey.
Audit your martech stack to determine, not only the marketing tools your organization currently has in place, but to what extent those tools are being used effectively. Pay careful attention to areas of underutilization and overlap. And, identify consolidation opportunities to reduce redundancy.