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7/24/2019 The Future of Marketing and Advertising Technology
1/13
April2015,IDC#255781
WHITE PAPER
Cloud Platforms: The Future of Marketing and Advertising
TechnologySponsoredby:MarinSoftware
GerryMurrayApril2015
IDC OPINION
Themarketformarketingandadvertisingtechnologyhasseenagreatdealofinnovationoverthepast
10yearssomuchsothatitnowboastswellover1,000vendors,whichIDChasorganizedintomore
than75categories.IDCbelievesthisstructureisunsustainable,andoverthenextthreeyears,the
forcesofconsolidationwillexertfundamentalchangesinhowenterprisesprovisionmarketingandadvertisinginfrastructureandfromwhomtheyprovisionit.Theresultwillbenefitbrands,vendors,and
customers.Findingsinclude:
Unsustainable complexity:Themarketformarketingandadvertisingtechnologyhasbeenininnovationmode.Pointsolutionshavecometomarketindependentlyandasynchronously,forcingbuyersintoreactionarypurchasebehaviors.Along-termplanhassimplynotbeenpossible.Asaresult,CMOshavehadtooptimizefragmentedmarketinginfrastructuresandmanageincreasinglyspecializedstaffmemberswhostruggletounderstandhowtheiractivitiesinfluencethoseoftheirpeers.
From managed services to software as a service SaaS):Brandshaverejectedtheagencyblack-boxmodeltodigitaladmanagement.Thereiswidespreadfrustrationamongbrandsnot
onlyaboutfeesandmarginsbutalsomorefundamentallyaboutbeingabletoapplybusinessacumentoadperformanceinrealtime.Digitaladvertising,ingeneral,andsearch,inparticular,representanincreasinglysignificantspendandrequirereal-timemanagement.SaaSsolutionsmakethein-houseapproachbothfeasibleandcosteffective.
Pervasive programmatic advertising:Adnetworksaretoocomplexandbuyerbehavioristoodynamictoservewithoutautomatedadplacementforlargeandevenmidsizecompanies.Optimizingreach,acquisitioncost,andpersonalizedcreativityacrosschannelsatscalerequiresmassivedatasets,algorithmicbiddingmodels,andreal-timevisibilitynoneofwhichcanbeachievedwithoutanautomatedsolution.
Competing on data:Usingadvertisingandmarketingtechnologytodrivecustomerexpectationsbeyondtheabilityofcompetitorstodeliverisbecominganewsourceofcompetitiveadvantage.Brandswiththeabilitytoaggregatemultiplefirst-,second-,andthird-
partydataacrosstheiradvertisingandmarketingoperationswillbethewinners.
ThekeydriverforthetransitiontocloudsisthevaluedeliveredtoCMOs.Theywillbeabletodeploy
consistentsolutionsonaglobalbasis,getbetterreportingfrominternalandexternalcampaign
investments,andmanagemarketingbasedonperformance.
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METHODOLOGY
ThisdocumentisbasedontheextensivemarketresearchthatIDChasconductedonthedevelopment
andadoptionofmarketingtechnologyaswellasinterviewswithfiveMarinSoftwarecustomers.IDC
hasalsoconductedextensiveresearchonhowenterprisesaredeployingmarketingandadvertising
technologyandhaspublishedanumberofframeworksandforecasts,whicharereferenced
throughoutthispaperandlistedintheRelatedResearchsection.
IN THIS WHITE PAPER
ThisWhitePaperpresentsIDC'sviewofhowkeytechnologytrendswillshapethefutureofthe
marketingandadvertisingtechnologymarket.TheanalysisisbasedonIDC's2015Strategic
FrameworkforMarketingTechnology,whichorganizesmorethan75categoriesofmarketingand
advertisingtechnologyintofourbroadcategories:interactionmanagement,contentproductionand
management,dataandanalytics,andmarketingmanagementandadministration.Thisframeworkis
thebasisforIDC'sworldwidemarketsizeandforecastformarketingtechnology,whichisexpectedto
reachmorethan$32billionin2018.IDCbelievesthiswillbeahighlydiversemarketwithmany
optionsavailabletobuyers,specificallybecausebothbest-of-breedandplatformstrategieswillbeneededtoserveavarietyofbuyeracquisitionstrategies.However,cloudplatformswillbecome
increasinglyattractivetomainstreambuyersthatlacktheresourcesofearlyadopterstoownand
operatetheconstellationoftechnologiesneededtorunmodernenterprisemarketingorganizations.
SITUATION OVERVIEW
Connected Customers Require Connected Marketers
Fundamentaltothegrandtransformationhappeningineverymarketingdepartmentonearthisthe
digitallyconnectedcustomer.Customersareconnectedtoinformation,eachother,andamyriadof
othersourcesinwaystheyneverwerebeforesmartphonesbecameubiquitous.Inadditiontothe
profoundpowershiftfrombrandstocustomersthatthishasenabled,thedigitalworldalsointroducedamind-bogglingnumberofnewmedia,devices,andmodesofinfluencesomeofwhichare
consumersthemselves.Asaresult,buyerbehaviorismorecomplexthanever.Itisnolongera
reliablelinearmodel;rather,itisnowaworldofalmostinfinitepermutations.Creatingaconsistent
buyerexperience,servingcustomersateachstepoftheirjourney,andtrackingeverycustomertouch
pointrequirehighlysophisticatedreal-timecommunicationandcoordinationofmarketers,systems,
content,data,processes,andreporting.Brandsarerealizingthataccomplishingallthisdependson
outstandingperformancenotonlywithinmediachannels(e.g.,searchads,social,mobile,Website,
andin-store)butalsoacrossmediachannels.Itrequiresaninfrastructurethatprovidesthefollowing:
Well-governeddata,datamanagement,andanalyticalcapabilitiesbasedondeepintegrationwithfirst-partycustomerandrevenueconversiondata
Advanced,real-time,andalgorithmicoptimizationtechniques
Transparentreal-timereporting
Deliveryofpersonalizedcontent
Fragmentedinfrastructure
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Unfortunately,aunifiedinfrastructurehasbeenhardtoachieve.Themarketingandadvertising
technologymarketisunsustainablyfragmented.Somanydifferentsolutionsareavailablethatitisvery
difficultforCMOs,chiefdigitalofficers(CDOs),andCIOstoachieveaholisticviewofwhattheyhave,
whattheyneed,andwhy.Someofthisisduetothesheernumberofsolutionsneeded,butitismore
dauntinginlargecompanieswithautonomousbusinessunitsandsiloedbudgetsthatlacka
governancefunctiontooverseetheselectionandspecificationofvariousmarketingandadvertising
systems.Inthelongrun,allcomponentsmustworktogetherbecausecustomerexperiencetranscendsinternaldistinctionsbetweenlinesofbusinessasmuchasitdoesmediachannels.Toprovidea
holisticview,IDCbreaksthemarketingandadvertisingtechnologymarketintofourbroadcategories
thataremadeupofmanysubcategoriesasfollows:
Interaction systems: Theprimaryfunctionofthesesolutionsistocommunicatetoand/orwiththemarketandconductthedigitaldialog.Theyincludethefollowingsubcategories:
Advertising:SolutionstomanageandoptimizeWeb,mobile,andofflineads,includingdisplay,social,search,andvideo
Digital commerce:Solutionssuchasecommerceplatforms,merchandising,mobilepointofsale,catalogs,real-timeoffers,location-basedtargeting,andsocialcommerce
Direct marketing:Solutionssuchasmarketingautomation,contentmarketing,emailmarketing,telemarketing,directmail,customercommunicationsmanagement(CCM),SMS/textmarketing,andmobileappdevelopment
Web site:SolutionssuchasWebcontentmanagement,mobileWeb,searchengineoptimization(SEO),video,chat,sociallog-ins,communities,portals,search,recommendationengines,tagmanagement,andpersonalization
Social monitoring and publishing: Solutionsforidentifyingandinteractingwithcommunities,influencers,competitors,partners,prospects,andcustomersonawidearrayoftrendingtopicsandsocialchannels
Other:Solutionssuchassocialmonitoringandpublishing,AR/PR,onlineandofflineevents,loyalty/gamification,salesenablement,andpartnerrelationshipmanagement(PRM)
Content production and management: Theprimaryfunctionofthesesolutionsistofacilitatetheproductionandmanagementofmarketingcontent.Theyincludeauthoringandpublishingtools(suchastext,image,audio,andvideo),contentmanagementsystems(CMSs),digitalassetmanagement(DAM),documentmanagement,contentanalytics,andinternalportals.
Data and analytics: Theprimaryfunctionofthesesolutionsistostoreandproduceinsightsfromcustomer,operational,andfinancialdata.Thetechnologiesinthiscategoryaredatabases,datawarehouses,anddatamanagementplatformsaswellasenterprise-classanalyticssolutionsoverandabovetheanalyticsembeddedinnearlyeveryinteractiontechnology.Thesesolutionscanaggregateandanalyzedatafrommultipleinternalandexternalsourcestosupplynewinsightsformarketers.
Management and administration: Theprimaryfunctionofthesesolutionsistoprovidetheinternalcommunications,workflows,budgeting,andexpensetrackinginfrastructuresthat
CMOsneedtomanagemarketingoperations.Theyincludemarketingresourcemanagement(MRM),collaboration,enterprisesocialnetworks,andprojectmanagement.
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Figure1showsamapofallthesolutionsinthefourbroadcategoriesthatcollectivelyencompassthe
marketingandadvertisingtechnologymarket.
FIGURE 1
IDC's 2015 Strategic Framework for Marketing Technology
Source:IDC,2015
Marketing and Advertising Cloud Consolidation
Theforcesofconsolidationareactivelyatworkinallareasofthismap,bothwithinandbetween
categories.Analyticsisseeingaconsolidationofsegmentation,predictive,social,Web,andevenmobile
dataintosingleofferings.Contentsearchandanalyticstoolsaresimilarlymerging.Managementand
administrationisseeingcloudcommunicationandcollaborationsolutionsgaintractionbymergingallof
thecollaborativeapplicationcapabilities.Intheinteractionarena,Webcontentmanagementsystems
nowfulfillmanyoftheWebsitemanagementrequirements.eCommerceplatformswillbeagravitational
forceinpullingallofthedigitalcommerceboxestogether.Figure2showsthediversechannelsaroundwhichadvertisingtechnologypointsolutionshaveemerged,butplatformsarealreadystartingto
consolidatesearch,social,anddisplayonWebandmobile.
Moni-toring
Pub-lishing
Web Content
Mgmt (WCM)Mobile Web SEO
ChatSocial Log-in/
SharingCommunity
Mgmt
OnlineVideo
Platforms
CustomerPortals
SiteSearch
ContentMktg
Platforms
Recom-mendation
Engines
Tag
Mgmt
Personal-
ization
IntegratedMktg
Mgmt/Mktg Auto
Mobile
AppsEmailMktg
Tele-marketing
Direct
SMS/
Text
Online
Onsite
AR/PR
Mgmt
Loyalty/
Gamifi-cation
Monitoring
Engaging
DigitalPublishing
Graphic &Web Design
A/V
AuthoringTools
Diagram-
ming
Office
AppsSurveys
Cat/
ClusterEngines
LanguageAnalysis
Q&AEngines
Digital Asset
Mgmt (DAM)
Doc MgmtMarket Intel
Mktg
Dataware-house
DataMgmt
WebAnalytics
Social
MediaAnalytics
PredictiveAnalytics
Reporting& BI
MRM
Budget/
Plan/Track
TeamCollaboration
Project Mgmt
Enterprise
SocialNetworks
EmailApps
Rich Media Search Text Analytics
Competitive Intel
Customer Intel
Social MktgOtherEventsDirect Mktg
Portals CMS
Content Search and Analytics
Authoring and PublishingWeb Site Mgmt
Retar-
getingOtherVideoSocialDisplaySearch
Web Ads
Ad BuyOptimization
OfflineAd Mgmt
Display Location Search
Retargeting Other
Mobile AdsOther Ads
Mktg Data MgmtAnalyticsMRMCollaborative Apps
Interaction Content
Data and AnalyticsMgmt and Admin
Clienteling Mobile POSMerchan-
dising
Social
Commerce
Real-TimeOffers
OnlineCatalogs
eCommerce
Platforms
Digital Commerce
DirectSales
Tools &Portals
PartnerRelation-
ship
Mgmt
Enblmnt
Advertising
CustomerComms
Mgmt
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FIGURE 2
Advertising Cloud Consolidation
Source:IDC,2015
Thebiggerissueisthecomingavailabilityofeverythingintheinteractionspaceasanintegrated
platform.Advertisingandmarketingcloudshavethepotentialtobreakdownthesiloswithinbrands
andagenciestoprovidebetter:
Cross-channelcampaigncoordination
Customerbehaviordata
Analyticsoninterchannelperformance
Returnonmarketing
Astheseofferingsmatureinthenextthreeyears,thebusinesscaseforoutsourcingmajorportionsofmarketinginfrastructureandserviceswillbecomeincreasinglyattractiveformanycompanies.
However,thetopglobaladagenciesdesperatelyneedboththetechnologyinfrastructureandthe
technicalexpertisetoruntheinfrastructure.Theywillbeheavilyreliantonthetechcommunityfor
digitalexecution,administration,andanalyticalexpertise.
Market Size and Forecast
Figure3forecastshowmuchorganizationsworldwidewillspendonsoftwaresolutionsformarketing.
Themarketwillgrowfromapproximately$20.2billionin2014tomorethan$32.3billionin2018.Itwill
beoneofthefastest-growingareasinhightechwithacompoundannualgrowthrate(CAGR)of
12.4%.Cumulatively,overthefiveyearsfrom2014to2018,organizationswillspendapproximately
$130billiononsoftwareformarketingdepartments.Themajorityofthisspendingwillbeintheareasof
interactionsystemsanddataandanalytics.
Advertising
CloudSearch
Social
Display
Online
VideoMobile
Offline
Digital
TV
Digital
Radio
Retargeting
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FIGURE 3
IDC's Marketing and Advertising Technology Market Forecast, 20142018
Source:IDC,2015
FUTURE OUTLOOK
Advertising Cloud Buyer Maturity
Marketingandadvertisingtechnologyareessentialtocompetinginthemoderndigital,mobile,social
marketplaceaswellasfortheaggregationandanalysisofofflinecustomeractivity.Itisamarketplace
ofbuyerswithlimitlessaccesstoinformationinwhichthelinearmodelofcustomeracquisitionhas
transformedintoadynamicofalmostinfinitevariations.Eachvariationrepresentsasinglecustomer's
journeyfromacquisitiontoadvocacyajourneyonwhichextraordinaryassistancefromsellersat
everystepisexpected.Thefollowingarethebasicrulesofengagementfacingthemodernmarketer
thatpresentahostofnewopportunities:
Marketersthatclearlyandquicklyseparateindividualpurchaseintentfromtheoverwhelmingnoiseinthemarketplacewillhaveahugeheadstartontheirrivals.
Companieswhosemarketerseffectivelyservethebuyeracrosspurchasestages,media
channels,devices,andreal-worldinteractionswillselltothebestcustomersthefastest. Marketersthatelevatebuyerexpectationswillmaketheircompetitorslookdatedandoutoftouch.
Capitalizingontheseopportunitiesrequiresaradicalnewapproachtomarketingonethatis
datadriven,creative,processoriented,responsive,hierarchical,andentrepreneurial.Leadership
requiresextensiveinvestmentinmarketingtechnologyandthedrivetorapidlymaturethe
infrastructureandtheorganization'sabilitytomakebestuseofit.Therequiredtechnologyisdiverse
andcomplex,somarketersmusthavearationalapproachtoacquiring,using,andintegratingsystems
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2014 2015 2016 2017 2018
($M)
Management and administration
Content production and management
Data and analytics systems
Interaction systems
7/24/2019 The Future of Marketing and Advertising Technology
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forinteraction,contentproductionandmanagement,dataandanalytics,andmarketingmanagement
andadministration.IDChasdevelopedthefollowingfive-stagemodelformarketerstoaccomplishthis:
Ad hoc: Retro-digital MarketingtechnologyislimitedtoemailandWebsite.
Opportunistic: MarketingautomationfallsshortDespiteitsname,marketingautomationaddressesonlyasmallpartoftheoverallmarketingtechnologyenvelope,primarilyintegrating
emailandWebmarketingwithcustomerrelationshipmanagement(CRM)systems. Repeatable:ProliferationofpointsolutionsInvestmentsareexpandedtoaddressburgeoningbut
separateneedsfornewareassuchasadvertising,mobile,content,dataandanalytics,budgeting,andresourceplanning.
Managed: MarketingplatformsPointsolutionsarefinallyknittogetherasaplatformviadataandprocessintegrationsthatencompassnotonlymarketingoperationsbutalsoadvertisingandreal-worldinteractions.Collaborativeworkflows,cross-channelcontrol,personalization,predictiveanalytics,andcontentmarketingcapabilitiesadvance.
Optimized: EnterpriseengagementAcomprehensivemarketingtechnologyplatformisintegratedwithothercustomer-facingenterprisesystems,supportedbyastandardizedcustomerdatagovernancestructure,andcoupledwithaculturethatfostershighanalyticsIQ,nurturescreativity,anddevelopsmultifunctionalmarketers.
Today,eventhemostadvancedusersareonlystartingtomakethetransitionfromtherepeatablestageto
themanagedstageor,inotherwords,frompointsolutionstoplatforms.Therearetwofundamentalreasons
forthis.First,asdescribedinthefive-stagemodel,thesupplysideofthemarketissimplydevelopedaround
pointsolutions.Second,someoftheseareashavebecomesocomplexthattheyrequiremasteringnew
organizationalpractices,processes,andskillsets.Ananalogytoanorchestraisapt.If50playersare
neededtoperform,theyeachmustfirstmastertheirowninstrument.Thentheymustlearntheirpartsforthe
piecethatthegroupwantstoperform.Next,theymustlearnhowtheirpartsfittogetherunderthe
orchestrationoftheconductor.Marketersarelikemusicianswhohavebeenissuednewinstrumentsthatare
unlikeanykindthey'veusedbefore.Theyarequicklymasteringtheirnewtoolsandlearningnewmarketing
plays,buttheyhavenotyetformedintoafull-fledgedorchestrainwhichall50musiciansperformasone.
Digital Advertising and Channel ConvergenceMarinwillbeahubtocapturedatafrommanydifferentsources,interpretit,and
providereportsforsubject-matterexpertstomakesmartdecisionsnotjustabouta
particularchannelbutaboutoverallmarketingstrategy.
David Rodnitzky, CEO, 3Q Digital
Digitaladvertisingisgenerallythoughtofasthreemaincategories:display,search,andsocial.As
thesedisciplinesemerged,companiesdedicatedpracticesareas,budgets,andtechnologystacksto
them.Specializedagenciesemergedwithdeepexpertiseinoneormoreoftheseareastooffera
varietyofmanagedservicesoptionsforbrands.Today,anumberofkeychangesarebreakingdown
thismodel.Thechangesareasfollows:
Brands are demanding more transparency and control from agencies. Managedserviceswhereanagencychargesamonthlyfeeorretainertoexecuteagivenamountofadspendarebeingrejectedbybrands.Themanagedservicemodeldoesnotofferthetransparency,control,orresponsivenessthatbrandsneed.Intoday's"alwayson"digitalmarket,brandscannotaffordtowaitforperiodicperformancereports.Asaresult,brandsneedaninfrastructureorservicethatprovidesreal-timeaccessandtheabilitytoquicklychangetacticswhenevernecessary.Thisbecomesmoreimportantastheadspendbecomeslarger.Agencieswillneedtomovetoopentechnologyandservicestocompete.
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Digital channels are linking and expanding. Display,search,andsocialarebecomingincreasinglylinked,andnewtechniquessuchasnativecontentareemerging.Consumersareconductingsocialsearches,publishersareleveragingeditorialwithuser-andsponsor-createdcontent,andmediachannelssuchasFacebook,Twitter,Pinterest,andLinkedInareaddingbundledadvertisingproductstotheirplatforms.Mobileisalsoplayingamajorroleinreshapingtheadlandscape.Dynamicallyservingadsonthemostcost-effectivechannel
basedonwhatcontentthecustomerhasalreadyseenrequiresdigitaladstoworktogether.Tothisend,majorvendorsareexpandingtheirchannel-specificproductsintomultichannelplatforms.Withinleadingbrands,siloedapproachestomanagingdigitaladvertisingarestartingtochange.Earlyadoptersthatinvestedheavilyinbest-of-breedapproachesforeachofthethreedigitaladcategoriesareworkinghardtocreateshareddatarepositories,workflows,andmetricsacrossthem.Newbuyerswillhavetheadvantageofhavinganincreasingamountofthisintegrationembeddedasadvertisingandmarketingcloudsmature.
Customers require better coordination between marketing and advertising. Today,customersareasdigitallysavvyasthebestmarketingandadvertisingprofessionals.Inreturnforallthedatatheyknowbrandshaveonthem,brandsarenowexpectedtousethedatatothebenefitoftheirprospectsandcustomers.Thisisahugeopportunitythatappliestotheentirebrandnotonlytoadvertisingandmarketingbutalsotosales,finance,fulfillment,andcustomer
service.Brandsthatarebestinclassatleveragingcustomerdataacrossthesefunctionswilldeliverandderivethemostcustomervalueoverthelifetimeoftherelationship.Brandsneedtobreakdownoravoidcreatingindependentsilosfordifferentcustomertouchpoints.Leadingbrandsarealreadystartingtoutilizethefast-pacedworldofadtechtomorerapidlyimprovetheirmarketingstrategyandtactics.Asaresult,interoperabilitybetweenadvertisingandmarketingwillbeasourceofcompetitiveadvantage,enablingbrandstomakethemostcompellingofferstothebestcustomersthefastest.
Efficiency at Scale
ThroughtheuseofMarin,wehavegrownourpaidsearchbudgetsbydoubledigits
everyyearsince2012.That'sveryimpressiveforamature,highlycompetitive
channel.
Mark Fiske, Senior Director, Global Marketing, Ancestry.com
Thepaidsearchenvironmenthasbecomesobigandsofastthatforlargebrandsit'ssimilartoaWall
Streettradingdeskinscale,complexity,andcompressedtimeframes.Therearemanydifferent
dynamicsthatmayrequiresubtletweaksormajorchangesinad-buyingstrategiesonadailyoreven
hourlybasis.Inbusinesstoconsumer(B2C),customerbehaviorcanchangeoverthecourseofthe
daywithmoreresearchhappeningduringworkinghoursandmorebuyingbehaviorafterwork.
Seasonality,holidays,sportingevents,andgeographiesalsoaffectconsumerbehavior.Moreover,life
eventssuchasweddings,funerals,andschoolgraduationscanbesignificantqualifyingsignalsfor
certainbusinesses.
Forbusiness-to-business(B2B)marketers,longmarketingandsalescyclesmakeitimperativeto
closelytrackbuyersinordertomakethemostcompellingofferstothebestcustomersthefastest.B2BbuyersgothroughlongeducationprocessesthatspanthefollowingdistinctstagesasdefinedbyIDC:
1. Exploration:
Buyerseeksfitbetweenabusinesschallengeandpotentialsolutions.
2. Evaluation:
Buyervalidatesthatthesolutionfitsitsneedsandcomparesalternatives.
3. Purchase: Buyerwantstodeploythesolutionassoonaspossible.
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ThemainchallengeforB2Bmarketersisthatasbuyersmovefromonestagetothenext,contentthatwas
previouslyvaluableandengagingbecomessuddenlyirrelevant.Thusitiscriticaltoconnectindividual
buyerstospecificactionsandresponsesandacutelytuneadvertisingandmarketingcontenttotheir
changingneeds.Thisdataisalsocrucialforoptimizingadinvestmentbecausewhatworksandwhat
doesn'tworkcanchangerapidly,andtransparencycanbethedifferencebetweensuccessandfailure.
ForbothB2CandB2B,otherlayersofcomplexityalsomustbeovercome.Competitorsareconstantlytryingnewtacticsasadinventoryiscontinuallychanging.Newchannelsemerge,adnetworkschange,
andcustomeraccesscostscanshiftsuddenlybetweenchannels.Asaresult,gettingthemostfrom
everysearchaddollarrequirestheabilitytobidatthekeywordlevelinrealtime,andlargebrandscan
havemillionsofthesesearchaddollars.Itissimplyimpossibletodowithoutanautomatedplatform.
Next-Generation Marketing and Advertising Teams
Theonlywaywe'llsucceedistohaveacoregroupofpeopleexecutingina
synchronousmanner.IfwetookMarinoutoftheequation,wewouldlosethe
consolidatedviewofbidsandcustomers.Wewouldhavetostartbuyingseparatelyon
eachadnetwork.Wewouldneeddigitalmediamanagersdedicatedtoeachchannel,
butthat'snothowourbusinessissetup.Ourline-of-businessmarketerscannotbeefficientwithoutanaggregatedtool.
Director, Acquisition Marketing, Large Retail Brand
Inadditiontotheirinvestmentintechnology,leadingorganizationsareusingthreekeypracticesto
bringgreaterefficiencytotheiradvertisingandmarketingoperations.First,theyareestablishing
centralizedrepositoriesandgovernanceforcustomerdata.Second,inadditiontochannel-specific
performancemetrics,theyarecreatingsharedmetricsacrosschannelseachteamiscompensated
onoverallmarketingperformance.Third,theyareusingcollaborativeworkflowenvironmentsto
increasethecoordinationandtransparencybetweenteams.Asaresult,theyareabletocollaborate
acrossmarketingandadfunctions,includingoptimization,social,content,paidsearch,andsearch
engineoptimization(SEO).Thisisconsideredacompetitiveadvantageintermsofimprovingspeed,
responsiveness,andconsistency.
Customer Snapshot From Managed Services to Advertising Cloud
A large brand-name retailer with a nine-figure marketing budget uses Marin to manage its search
ad investments. Eight years ago, the digital ad budget was largely dedicated to email and the
Web site. The small amount of search ad activity was handled by an agency. Today, paid search is
the largest portion of the digital ad budget, and the lack of visibility provided by the agency
model was extremely frustrating. Marin enabled the company to bring search advertising in-house
and improve control, visibility, and performance.
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Attribution and ROI
ThebigthingthatMarinbroughttothetablewastheabilitytointegrateourCLVdata.Campaignswethoughtwereverysuccessfulturnedoutnottobe,andviceversa,
whenwelookedathowlongcustomerrelationshipslast.CLVanalysishasbecome
fundamental.
Mark Fiske, Senior Director, Global Marketing, Ancestry.com
AttributionandROImodelsareverydifficulttobuildforlarge-scalemarketingoperations.Itcanalsobea
highlypoliticalconversationbecauseitwilldirectlyimpactbudgetallocationsindifferentgroupsthat
ultimatelyshouldbeworkingtogethertowardthesamegoals.Inmanyrespects,thedetailsofthe
methodologyarelessimportantthanthedegreetowhichitistransparentandunderstoodbyeveryoneup
anddowntheorganization.Italsorequirestransparencyacrossthedifferentsystemssothateveryone
truststhereportingprocessfromeachofthedifferentdigitalchannels.Ithelpsagreatdealifexecutives,
finance,sales,andmarketingcanestablishmethodsforattributingmarketingcontributionearlyonbeforeitgetstoocomplicated.Thedegreetowhichmarketingcontributioncanbeattributeddirectlytorevenue
dependsonbusinessmodels.ManyB2Ccompaniescanaccomplishthis,butmanycannot.Thekeyisto
connectcontactstoadspendandthentracktheirprogressthroughnurturingcampaignstoatransaction.
However,therearekeychallengesforbothB2CandB2Bcompanies.ForB2Ccompanies,customersdo
notalwaysbuytheitemtheyclickoninanad.Forexample,anadforjewelrymayultimatelyresultina
saleofshoes.ForB2Bcompanies,atweetthatlinkstoawhitepapermayresultinavideoview.Without
thedatathattrackstheflowofcustomerinteractionsacrossbothadandmarketingtouchpoints,itisvery
easytounderestimatetheinfluencethatadshaveonbuyerbehavior.
Customer Snapshot Managing Modern Marketers
3Q Digital is creating multifunction marketers and grooming them on a career path that
encompasses both the science and the art of modern marketing. A multifunction marketer is
someone with depth of expertise in one or two areas and familiarity with a portfolio of channels,tools, and go-to-market models. People at the bottom of the marketing organization spend 80% to
90% of their time on the science of marketing. At the top of the organization, they spend 80% to
90% of their time on the art of marketing and fostering creativity throughout the agency. The
career path may start in social advertising with exposure to search, display, email, and so forth.
As they broaden their expertise, they are able to think in terms of cross-channel campaigns as
opposed to having a singular focus on tactics in one area. This enables them to contribute more
and have more valuable conversations with clients.
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FUTURE OUTLOOK
IDCpredictsthataftermorethan15yearsofunbridledinnovation,themarketformarketingand
advertisingtechnologywillenteraconsolidationphaseinthenexttwoyearsaspointsolutionsrapidly
evolvetocloudplatforms.Somepointsolutionswillbeconsolidated;otherswillremainasindependent
"add-ins"toservenicherequirementsandcomplementmajorplatforms.However,themarketatlarge
willmovetoaplatformmodelinwhichmostmarketingtechnologywillbeavailableasaserviceand
potentiallybundledwithtechnicalandagencyservices.
For Suppliers
Theavailabilityofadvertisingandmarketingcloudsraisestheurgencyforsupplierstodecidehowthey
willnavigatethecomplexsetsofrelationshipsbetweentechvendors,agencies,consultancies,andintegratorsthatwilldeterminemarketpower.IDCexpectsalliancesbetweenthemajortechand
agencyplayerstobedominantintheenterprisesegment.Companieswhosetechnologybecomes
embeddedintothelargermarketingcloudsolutionswillfindtheserelationshipshighlyinfluentialin
termsofavailablemarketandfuturemergerandacquisitionactivity.
For Buyers
Theevolutiontomarketingcloudshassignificantimplicationsforhowmarketinginfrastructurewillbe
provisionedandfromwhom.Italsohassignificantimplicationsforthefollowing:
Outsourcingandcapacity-planningstrategies
MarketingITbudgetingmodels(potentiallyrollingtechnologyspendintotheadvertisingbudgetwhenbundledagencyofferingsareavailable)
Intheshortterm,leadingCMOswillbuildoutextensiveinfrastructureandtheassociatedorganizational
skills.Asaresult,theywillhaveadvantagesininternalexpertise,responsiveness,andcontrol.Inthelonger
term,marketingcloudswillmakemanyofthesamecapabilitiesavailabletoeveryone.IDCdoesnot
endorseawaitingstrategybecauseitwillhavesignificantimplicationsformarketshareerosionandresult
inanorganizationthatlacksmasteryincoredigitalandanalyticalskills.Whilemarketingplatformsmature,
Customer Snapshot Data-Driven Marketing
The best-case scenario for attribution modeling is to have senior executives from finance, sales,
and marketing establish a model irrespective of any technology or process within those functions.
An enterprise perspective is needed to ensure the attribution methodology properly accounts forthe specifics of the business model. This is the case at a regional self-storage provider. The
attribution model is embedded in the business-planning process. Once revenue objectives are set,
sales and marketing investments can be allocated based on expected inventory availability.
Actual expenditures are tracked carefully against performances across ad campaigns and
marketing programs and adjusted as needed. The key is to avoid making attribution a political
issue, which it inherently is due to the fact that people running more successful programs will
tend to get more resources. When attribution is fair, consistent, and transparent at the
enterprise level, it creates a collaborative culture that results in better coordination and overall
contribution from advertising and marketing efforts.
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2015IDC #255781 12
technologywilldiminishasasourceofcompetitiveadvantagebecausemostcompanieswillhaveaccessto
thesameinfrastructure.Therefore,thelong-termdifferencemakerswillbetheproficiencyandcreativityof
yourpeople,theefficiencyofyourprocesses,andthemasteryofyourcustomers'behaviors.While
developingtheseareas,CMOsshouldcontinuallymonitorthedigitalcapabilitiesoftechvendors,agencies,
andothermarketingservicesprovidersandregularlyreevaluatethebuy-versus-buildequation.
CHALLENGES AND OPPORTUNITIES
ChallengesforMarinwillbetoexpanditsadvertisingcapabilitiesacrosssearch,social,anddisplay
somethingitisalreadydoingasindicatedbyitsrecentacquisitionofSocialMoov.Inaddition,Marin
shouldensurethatitscustomerdataisusablebyothermarketingandCRMsystems(andviceversa)
sothatclientscanbetterleveragecustomerinsightsacrossallmarketing,sales,andevencustomer
supportactivities.Finally,asothermarketingservicesfirmssuchasagencies,consultancies,business
processoutsourcers(BPOs),andevensystemsintegrators(SIs)expandtheirofferingsformarketing,
Marinmustoutmaneuveritscompetitorstodevelopstrategicpartnershipswithkeyplayers.
Theseactionswillhelppositionthecompanyasadtechandmarketingtechconvergeoverthenext
twotothreeyears.CompaniessuchasAdobe,IBM,Microsoft,Oracle,andSalesforce.comhaveinvestedbillionsofdollarsintheirmarketingcloudstrategies.Thisinvestmentisexpectedtocontinue
ascompaniesexpandtheircoverageofIDC's2015StrategicFrameworkforMarketingTechnology.
Eachnewcapabilitytheyaddrepresentsakeydifferentiator,andbyacquiringcompanies,theymake
thetechnicalandorganizationalexpertiseunavailabletocompetitors.Todate,muchoftheM&A
activityhasconcentratedonmarketingoperationssuchascampaignmanagement,socialmarketing,
contentmarketing,anddataandanalytics.IDCexpectsadvertisingtechnologytobecomeakey
additiontomarketingcloudofferingsforallthereasonspreviouslydiscussedinthispaper.
CONCLUSION
Thereisnoshortageofopportunityinthemarketingandadvertisingtechnologyarena.Themarket
continuestoevolvenewcapabilitiesanddeliverymodelsforcustomers.Brandshavetremendousupsidepotentialbutmustmitigatetheassociatedrisksofmakingtherighttechnologydecisionsattherighttime
sothattheyarenotoutmarketedintheincreasinglyfast-pacedexpandinguniverseofdigitalmarketing.
RELATED RESEARCH
TheMarketingSoftwareRevolution:StrategiesforBuyersandSellers(IDC#WC20150108,January2015)
IDCMaturityScape:MarketingTechnology(IDC#252793,December2014)
DigitalMarketing:TheFutureRoleofAgencies(IDC#252328,November2014)
WorldwideMarketingSoftwareForecast20142018:$20BillionandGrowingFast
(IDC#251902,October2014)
IDC'sStrategicFrameworkforMarketingTechnology:FiveDriversThatGetCMOsandCIOsontheSamePage(IDC
#248828,
June2014)
MarketingasaService(MaaS):ANewRoutetoMarket(IDC#247587,March2014)
IDCMaturityScape:Data-DrivenMarketingBeyondMarketingAutomation(IDC#244993,December2013)
7/24/2019 The Future of Marketing and Advertising Technology
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