Companies are being bought, usually by big names as an economic way to widen their functionality and customer base, while others are going out of business. While this is going on, newcomers continue to arrive with innovative tools and services.
In the early days of marketing technology, it was probably 'good enough' to sign up with a promising brand or product. And even to embellish it with complementary apps and services, homegrown or otherwise, to stay ahead of what was then a fairly simple game.
Now, it's altogether more serious. For many companies, marketing lies at the very heart of their success. Sure, they need quality products and services to sell but, without the ability to attract the interest of the right people at the right time, their businesses will struggle.
You have to find a way to work within the market as it stands. The best way to handle the volume is to apply filters, rather like you do when shopping for any serious purchase. You start by defining your needs, then by shortlisting potential suppliers, then filtering them according to their 'fit' with your circumstances.
Choosing marketing technology products and services has to be driven first by the company's needs. Without articulating them, and the expected results from the marketing department (defined in business outcome terms), it's impossible to start choosing the most appropriate providers.
Some companies will go for an all-in-one solution which offers decent integrations to their existing systems. That is a straightforward choice. Although, whether you have a core system already or not, you may require extra functionality. This is where the filtering comes in.
Having decided your needs, your first filter will relate to functionality. For example, if you're looking for 'analytics', the combined UK/US supplier list is currently about 470 companies. If you filter by 'UK HQ', the list becomes a much more manageable 40 companies. You can further reduce the set by factors such as their experience with your type of company, their ability to scale to your size of operation, their ability to integrate with what you already have, their cultural fit, and so on.
It's an unfortunate fact that companies buying marketing technology tend to move more slowly than either the supply marketplace or the demands of their customers. The speed at which you can adapt is a key factor in your success. (It's a bigger challenge in the B2C world than in B2B.) This won't change in the foreseeable future, so you have no choice but to adapt as quickly as you can or drift further behind your competitors.
Sources of support
One bright spot is that IT and marketing departments have grown closer together as marketing technology has become vital to a company's well-being. Ideally, each has a foot in the other's camp which feeds communication, understanding and collaboration and the ability to conduct due diligence on potential suppliers. 'Shadow IT' ought to become a thing of the past along with other operational silos.
Another way to help get your technology strategy right is to seek external specialist expertise to guide the one-off activities that precede your search for new systems and services. Their involvement ought to accelerate your time to results.
The stages might include some or all of: auditing your present state - data, operations, technology, staffing; your business needs; your implementation priorities and plans; your technology choices; your technology implementations. Some of this might be possible with internal staff and some companies will choose to buy in new talent (quick) or up-skill existing staff (slower).
The likely future
Don't expect the vendor marketplace to settle down soon, although the past does give some idea of what may happen. When the PC market was booming, in the mid to late 80s, new dealerships were popping up all over the show. Many had unrealistic dreams of becoming household names and making their fortunes. Many overstretched themselves and subsequently collapsed or were acquired for peanuts.
Don Pinchbeck, one-time MD of printer company Epson and subsequently a company turnaround specialist, put himself on the map by telling dealers some hard truths about what it takes to make it to the big time. Speaking at a dealer conference on the SS Canberra in 1991, the previous speaker overran so to help the organisers out, he compressed his story into an audience-pleasing 15 minutes. He summarised by telling them, "Get big. Get niche. Or get out."
This advice is as good today as it was then. In the case of the marketing technology vendors, the "Get big" and "Get out" could be conveniently combined into a fourth alternative: "Get bought". A fifth alternative combines "Get niche" and "Get big" which is to sell through third party platforms, a model pioneered by Salesforce, Wordpress and Amazon. Hubspot's App Partner Program epitomises what is already possible in the marketing space.
If the marketing technology industry follows that of its predecessors, it will continue to boom economically, but the number of participants will shrink. One of the most notable examples of this consolidation was Adobe's acquisition of Marketo in 2018.
The bottom line
A recent Forbes report cited Forrester's estimate of a global marketing technology market of $15.6bn in 2019 growing to $25.1bn In 2023. In Pinchbeck's terms, eventually they will become a mix of big (behemoths and platforms) and niche. This will make life easier for future buyers. But the choices you make today will stand the test of time if they are based on a solid business requirement strategy and an eye to integration and/or openness.