Larger Companies Seem to Be Getting More Out of Their MarTech

October 14, 2020

Merkle MarTech ROI by Company Revenue Oct2020While companies generally report good ROI from martech platforms, higher-revenue companies are getting more for their money, according to Merkle’s latest Customer Engagement report [download page]. In the survey of 400 marketers at major US and UK B2C brands, Merkle explores the priorities and considerations involved in developing the modern martech platform.

When asked to rate their platform’s ROI delivery on a scale of 1 to 5, higher-revenue companies reported receiving expected ROI more frequently than lower-revenue companies. Those earning $500M-$999M were the most likely to rate ROI at 5 (45%) followed closely by those earning $1 billion or more (44%). This is compared to the 30% of companies earning $100M-$499M that rated platform ROI at 5, while the largest share (44%) of this latter group rated ROI at 4.

The Current Martech Situation

It would appear that there is still work to be done when it comes to developing martech platforms: two-thirds (68%) of respondents identified their current martech situation as needing to build a custom platform. Granted, some 46% are working with the technology they already have, and around 4 in 10 (43%) feel that they have too much technology.

By industry, nonprofits were most likely to report that they need to build a custom platform (86%), while insurance companies were least likely to feel this way (53%). Financial companies most frequently reported having too much technology (48%), and, again, insurance companies showed the strongest desire to invest in technology platforms (37%).

Investment Considerations

Research from earlier this year, and prior to COVID-19, indicated that the majority of marketers were to continue investing in their martech stack this year. Merkle’s survey found a number of reasons for investing in martech, the most common being to accelerate digital transformation (69%). This is likely felt particularly strongly since the COVID-19 pandemic and the necessary emphasis on digital channels.

Marketers are also investing in martech to modernize their technology (67%), improve efficiency with fewer resources/staff (61%) and fill gaps in current technology (54%). Only 1% are not investing at all in martech.

Examining the results again by industry, high-tech and nonprofit companies were most likely to invest to accelerate digital transformation (both 71%), while insurance companies showed the strongest interest in investing to modernize technology (74%). Besides industries classed as ‘other’, high-tech and retail consumer goods were most likely to invest to improve efficiency with fewer resources/staff (65% and 64%, respectively).

Implementation Approaches

By some margin, marketers showed a preference for a best-of-breed approach to implementing martech; that is, purchasing platforms that meet the business’s unique goals. Two-thirds (67%) of respondents indicated a preference for this approach, while one-third (33%) tended to opt for a single stack (a platform that includes all features or functionality in one solution).

However, the picture changes somewhat industry-by-industry – for example, while health companies show an above-average preference for best-of-breed (76%), nonprofits essentially invert this preference with 7 in 10 (71%) that opt for a single stack solution.

When asked their preference between off-the-shelf and custom-build martech platforms, the vast majority (79%) of respondents showed a preference for custom-build. Top justifications for this preference included scalability across the organization (45%), robust features and offerings (41%) and price (30%).

Finally, the value of real-time data processing in a platform approach is not lost on marketers. When asked to rate this importance from 1 to 5, some (90%) rated it at 5 or 4.

Read the full report here.

About the Data: Results are based on a July 2020 survey of 400 marketers at major US and UK brands from a variety of industries, with Retail Consumer Goods (26% share), Hi-Tech (25%) and Financial (24%) most heavily represented.


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