Pop quiz: what do today’s marketing teams and the Oakland Athletics from “Moneyball” have in common?
Both face limited budgets, fierce competition, and the need to maximize value. And the most striking similarity of all? Both are shifting from gut instincts to data-driven decisions.
Just as Coach Beane used analytics to scout undervalued players, modern marketers are turning to technology for a competitive edge. A recent G2 MarTech survey reveals that 84% of businesses have increased their use of marketing technology, or MarTech, over the last three years.
But if MarTech is so prevalent, why aren’t more companies claiming that winning streak? Let’s identify the key levers driving increased MarTech use and the obstacles holding businesses back.
The article is based on G2’s MarTech survey that was sent to digital marketers worldwide via email. The survey sought to understand how they select, use, and upgrade marketing technology.
Companies today have more than one entry point to their marketplace.
So, how do they engage customers across diverse channels that include social media, websites, third-party sites, ads, and newsletters?
With marketing technology.
With MarTech in high demand among companies vying to cover all doors to their marketplace, G2’s State of Software report, August 2024, found it was the fifth fastest-growing market based on new products added.
Marketing was also the second most viewed category on G2, just behind the vertical industry. This underscores the growing importance of MarTech as a necessity, not just a need.
While there are several factors behind this demand, one that stood out was as simple as its ability to solve problems.
“As the market becomes more sophisticated, it’s crucial that tools stay agile. Campaigns are smarter, teams move faster, and have bigger goals, which is why marketers need a multi-faceted product that solves more than one problem.”
Victoria Blackwell
Research Principal, G2
Other factors driving MarTech use include:
Let’s delve deeper into the above motivating factors.
MarTech ownership is key when it comes to effectively using these tools.
In 60% of companies today, marketing department heads and marketing operations teams control the MarTech stack, according to the MarTech survey.
With this control, marketers face less friction in designing and launching campaigns using these tools. They have autonomy over them and can decide where and how they are used. This gives them more confidence to justify budgetary allocations for these software.
But with greater autonomy comes greater responsibility. Does having more control over marketing tools imply increased pressure on marketers to prove a return on investment (ROI)?
According to Victoria, there will always be pressure on marketers to prove value, regardless of the control.
“Software can come with a high price tag. Since marketing teams aren’t often regarded as revenue drivers, they fight much harder to prove their perceived worth. Marketing is truly the combination of creativity and trial and error. So, proving ROI will come with time and trusting your analytics,” she says.
Michael Pannone, Director of Demand Generation at G2, adds that good marketers today monitor the impact and ROI of MarTech, certainly before renewals.
Different tools might impact different audiences or parts of the buyer’s journey, he says. So smaller point solutions can be replaced by features in more comprehensive platforms.
“The best marketers consider all these factors and make decisions on renewing, downgrading, or even churning depending on what they’re seeing,” says Michael.
This year, 67% of organizations have adopted AI into their MarTech stack, according to the G2 MarTech survey.
Enterprise firms with over 1,000 employees lead the pack here with 92% adoption. Smaller and mid-market businesses are still catching up, with an adoption rate of 60%.
Marketers prefer tools with AI functionality. The G2 Buyer Behavior Report, 2024, found that AI functionality is important for 93% of marketing software buyers. Small businesses, in particular, highly value the use case of AI in marketing.
Source: G2 Buyer Behavior Report, 2024
Many of the fastest-growing AI categories on G2 have a use case in marketing, with data showing the top 10 are frequently used by marketers. These include software in categories such as AI writing assistants, display ad design, video editing, text-to-speech, and conversational marketing.
“The broader use of AI is opening up new channels and use cases for marketers,” says Michael. This includes personalization, reach, retargeting, and engagement.
“AI is revamping MarTech by making it smarter and more efficient,” says Fernando Angulo, Senior Market Research Manager, Semrush. “It allows for more precise targeting and personalization, helps predict customer behavior, and automates repetitive tasks.”
He gives the example of Semrush’s ContentShake AI feature, which helps produce search engine-friendly content by combining AI capabilities with Semrush’s SEO data.
“AI innovations in MarTech are designed to help marketers work smarter, not harder, and achieve better results with less effort,” explains Fernando.
Nicholas Holland, VP of product and GM, Marketing Hub at HubSpot says AI is both a catalyst and a solution.
“With the help of AI, marketers can create more effective campaigns to generate higher quality leads with constrained resources — but it has to be easy.”
Nicholas Holland
VP of Product and GM, Marketing Hub, HubSpot
He gives the example of Hubspot’s new feature, Content Hub with Content Remix, which uses AI to turn a single piece of content into a multi-channel campaign.
In addition, Meyar Sheik, Global President at Insider, argues that AI is also helping marketers enhance customer experience to yield greater revenue.
Marketers are also increasingly turning to automation. In 2023, marketing automation was the marketing category with the most unique pageviews on G2.
Automation puts repetitive tasks on autopilot so marketers can focus more on segmenting the audience, personalizing experiences, and boosting customer interaction. A key component of marketing automation is integrating analytics to gauge campaign performance.
The ability to quantify spending and outcomes is helping marketers slash costs and use technology more mindfully. They, thus, feel more confident in proving an ROI on investments.
User behavior for marketing automation software
Changes in customer behavior are shifting the industry from the traffic economy to the attention economy, which is driving increased use of marketing software, believes Nicholas.
“For example, AI is turning inbound channels, like search and social, into walled gardens — answering questions directly in search results and giving less visibility to posts with links. At the same time, channels are over-saturated, making it hard to break through the noise,” he adds.
The traditional traffic-driven model relies heavily on metrics such as page visits and click-through rates to measure success. However, this approach doesn’t touch upon customer engagement, delight, and retention. That’s where a shift to capturing attention can help.
For this, companies are eager to sustain user interest across channels, which can prove more cost-effective as customer acquisition costs shoot up in the B2B market. Investing in garnering the loyalty of customers is a major component of this.
In addition, Nicholas argues that marketers are trying to make sense of the customer journey, which is fragmenting across the internet and breaking traditional attribution models. “Marketers need new solutions to get attention for their content and to measure effectively, and so they’re adapting their strategies and adopting new tools to be successful in the attention economy,” he says.
Marketers’ view of customers is among the truest as they interact with them along their journeys, from acquisition to conversion. So, the greater adoption of marketing tools comes as a natural means to acquire a competitive edge.
Fernando comments, “Businesses are using more marketing software, more often, to stay competitive and effective in the market. With more data available than ever, companies are turning to MarTech to understand customer behavior, personalize their marketing efforts, and get better returns on their investments.”
He goes on to say, “The push towards digital transformation, significantly accelerated by the pandemic, has made advanced marketing tools essential. Companies need to analyze data in real time and create efficient, targeted campaigns, and MarTech provides the tools to do just that.”
The increased use of MarTech, accelerated by the COVID-19 pandemic, fits the overall digital adoption of companies to simplify operations, improve customer experience, and reduce costs. It has had a multiplier effect beyond its function to enable the integration of systems across sales and customer success teams and improve decision-making at the leadership level.
Companies today recognize that a superior customer experience is crucial for differentiating themselves in a crowded market. Three aspects are important for this: data-driven decisions, personalization, and retention. Marketing technology is helping unify these solutions into a single platform.
Companies can now fine-tune their customer experience (CX) strategies as they gather more data on customer behavior and preferences in real time. Marketing tools prove indispensable here.
Meyar explains, “The increased usage of marketing software results from businesses recognizing that customer experience is the most important value driver and critical to retaining customers and winning loyalty."
He believes CMOs are also under pressure to prove their tech drives ROI and is being used effectively. "They are actively looking to switch to solutions that offer lower total cost of ownership (TCO), remove disconnected and duplicative point solutions, and offer a consolidated platform that is easier to use and manage, increases productivity, and drives growth efficiently," he added.
"Lastly, traditional software giants no longer have a decisive technological advantage, which indicates a mature market with a high level of adoption and usage,” he said.
Affordable solutions have made superior customer experiences accessible to smaller companies. This democratization of technology is a result of customers seeking individualized experiences irrespective of brand value, which is nudging the further adoption of MarTech.
The underutilization of MarTech hurts marketers.
The survey found that every second organization that didn’t fully use its marketing tools faced MarTech budget slashes the following year. This has pushed companies to prefer leaner stacks with high utilization rates. They no longer eye every shiny, fresh tool on the market to bloat their tech stacks.
What are the factors holding marketers back from using MarTech further?
The sharpest pain in underutilizing MarTech comes from the limited skills to operate these tools.
This affects MarTech use in as many as 63% of organizations, according to the MarTech survey. The hurdle is the tallest for the mid-market segment (51-1,000 employees), where three out of four organizations face the skills gap.
Users can feel clueless about a new tool or take an inordinate amount of time to learn to use it. This can mean patchy software adoption and even a delayed ROI.
This lack of skills can mean two things: unfriendly software or a lack of limited baseline skills.
Complicated MarTech frustrates marketers as they use these tools. However, on an optimistic note, research at G2 suggests that marketing tools are becoming more user-friendly.
This means users with basic know-how can also deploy MarTech now, and faster. This, in turn, means a faster realization of ROI and improved satisfaction rates.
Limited baseline skills could mean significant opportunity costs, as time and resources are lost in figuring out how to use software. This is the time marketers could better spend on core tasks such as engaging customers through emails or events.
Marketers today face a steep learning curve relating to data analytics. They must also overcome the challenge of converting those data analytics into actionable metrics.
Knowing your brand isn’t lost here, either. Some industry experts told The Wall Street Journal that leaders must combine these strong data skills with brand awareness to maintain balance.
The easier approach to address this skill issue is to hire people with the required expertise. “The other track is to ensure everyone is upskilling,” suggests Leandro Perez, Chief Marketing Officer for Salesforce in the Asia-Pacific.
Pitching for online learning platforms, he adds, “You want people to be self-serve. You don't want a marketer who needs to go to an analyst or IT to understand the ROI for their campaigns. You also need a resilient and agile team because their skill sets change and grow.”
Seconding him, Michael calls upon organizations to get their teams certified in new tools and products so they can get the most out of them and hit the ground running once they onboard a new product.
Marketers are intent on building onto their current tech stack.
The survey found integrations to be the top evaluating factor for companies looking to buy new MarTech.
At least 70% look for emerging technologies that can integrate with their current stack. Marketers prefer adding tools to existing stacks over replacing them. This is to avoid any potential disruption to existing data streams and control over tools. It also points to the importance of scalability in tools with evolving business and technological needs.
However, as many as 45% of organizations have been deterred from adding more to their MarTech because they struggle with integrations.
While shopping for MarTech, marketers must pick tools compatible with software in other functions, not just those used in marketing. The tools must integrate with the existing IT infrastructure along with sales, customer experience, and product software. Such integration tests must be conducted during product demonstrations and be cleared by IT.
With MarTech empowering marketers by taking over repetitive tasks and signaling better target customers, the average marketer uses three MarTech applications per week, according to the G2 MarTech survey.
But how is the increased use of marketing applications transforming the very role of marketers? And are there any new areas of focus for them?
Michael believes that today's marketers can align around a pre-sales position in the buyer’s journey as they build brand awareness and engage accounts at the top of the funnel.
This is helping them focus more on accurate attribution and measurement of marketing activities instead of acknowledging customers only when they reach the middle of the funnel, which makes attribution difficult.
Marketing technology isn’t about the technology itself, says Andy Crestodina, co-founder and CMO at Orbit Media. “It is about the insight or output you get from it.”
However, he worries about marketers overbuying technology when you can launch impactful campaigns without fancy tools.
“Just because there’s a tool [software] in the toolbox doesn’t mean you have to reach for it and ask — what should I do with it today?”
Andy Crestodina
Co-founder and CMO, Orbit Media
Andy paraphrases customer experience strategist Jay Baer to say, “It is the wizard, not the wand.”
“Prescription before diagnosis is a malpractice,” adds Andy. “I think people get a bit overexcited about new technology and may lose their strategic focus. Sure, go ahead and use analytics, but use it to find insights.” While overbuying is certainly a concern, the increased need for MarTech cannot be denied.
Marketers are shifting their attention from short-term revenue growth to profitable growth that boosts the bottom line, believes Meyar.
It means focusing on the customer journey, including how to reach consumers across more channels and engage them for longer. And this requires an increased use of technology.
He posits that with technology, marketers focus more on retention than customer acquisition. So, metrics such as customer lifetime value and average revenue per user are becoming more important.
Along with changing priorities and focus on data analytics, the needs of customers are also evolving.
Attesting to this, Nicholas suggests that marketers must evolve their strategies and tooling to meet these needs. This means learning the type of work AI can augment to free up time for human creativity and how it can help marketers generate leads using fewer resources.
He adds that online behavior is changing, too. Marketers should be aware of this. “For many years, YouTube was seen as a consumer channel, but now it's a key source of attention for all companies. Google was where you did your research; now it's social networks and places like Reddit.”
“Marketers are now at the crossroads of creativity, analytics, and technology.”
Fernando Angulo
Senior Market Research manager, Semrush
Using MarTech is now necessary for marketers as companies compete for the attention of customers who demand a stronger personal touch.
But to compete effectively, companies must choose unified solutions that are easy to use and scalable. These solutions can help companies speak the same language across channels, build trust with customers, and nurture lasting relationships with them.
Many marketers fear their competitors will pull ahead by using AI to expand marketing channels and deliver personalized experiences.
However, if a tool doesn’t fulfill a real business need, it’s no better than an unread book on a shelf — taking up space without serving a purpose. So make sure every piece of software in your tech stack truly counts. Aim for a lean, integrated, and efficient system.
For this, cross-collaboration with the IT, sales, and customer support teams is essential. Marketers are already bullish about this opportunity. The MarTech survey found that around 75% of them want to improve the relationship between IT and marketing to optimize tech utilization.
The key to working with other teams on MarTech is knowing how it could help meet their needs, too. For sales, it could mean frictionless attribution, while for support teams, the tools could offer a holistic customer view.
Further utilization also depends on smooth integration with other tools to simplify information flow. Standalone products that don’t sync with other tools can only hurt the sales of software makers and dissuade marketers. Thus, while differentiating their products, makers must make it easier to plug their products with others.
But does the increased MarTech use threaten the job of a marketer? It doesn't. Hear me out.
Every company wants to ride the MarTech wave today. It's become the minimum standard necessary to survive. However, how does a business stand out amongst competitors that are using the same tools? The unmistakable differentiators are human intelligence and creativity.
An individual has the final say in deciding why, where, and how software must be used. These decisions stem from an agility to manage change and an awareness of business contexts. Marketers do this better than any tool on the market.
Skills make technology usable. But human wisdom makes it meaningful.
Software buyers prefer AI functionality across all types and expect a faster ROI on AI investments. Curious to know more such buyer insights? Check out our recent report.
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