Marketing technology has seen a remarkable innovation boom over
the past 10 years — so much so that the market now boasts over a thousand
vendors that IDC organizes into more than 75 categories. IDC believes this
structure is unsustainable and over the next three years the forces of
consolidation will exert fundamental changes in the way large enterprises
provision marketing infrastructure and from whom they provision it. The marketing
technology market, like much of the IT industry, will move to a cloud based service
model which IDC calls the "third platform." As the illustration shows, more than 90% of the growth in the IT industry will come from this model.
For marketers, the third platform means the advent of Marketing as a Service (MaaS), which will have transformative
affects for IT, IT services, and creative agencies. Key indicators that MaaS is on it way include:
- Unsustainable complexity: Point solutions have come to market independently leaving it up to marketers to assemble them into rational infrastructures. This is a highly inefficient market model for buyers and sellers.
- Transition to platforms: The consolidation of point solutions into platforms has already begun. Many noteworthy acquisitions have been made by major vendors such as Adobe, IBM, Oracle, salesforce.com, and SAP. However, this phase of market development will not last long as markets move rapidly from platforms to "... as a Service" models.
- Digital and creative coming together: AdAge recently named IBM the number one global digital agency in the world. IBM is rapidly hiring from the agency world to build out its creative services. Adobe has deep and long standing technology partnerships with many top agencies. The agency world needs a value proposition that will allow them restore margins and regain strategic relevance.
MaaS includes the fundamental technology, IT
services, and creative services that marketing needs in a bundled offering. Bringing these services together delivers
significant value to CMOs who have two key sources of pain: On one hand, their agencies
cannot effectively execute omnichannel campaigns nor deliver real time attribution reporting.
On the other hand, technology has added a great deal of cost and
complexity to their operating environments. MaaS enables them to outsource much of the technological complexity, pay for it out of their advertising budgets and get better
integrated marketing services from their top agencies. For tech vendors it
means gaining access to the advertising budget which dwarfs marketing IT spend
by orders of magnitude. As a result, IDC expects this model to be a major route
to market for marketing technology in the enterprise segment. It is therefore
an urgent action item for tech vendors, system integrators, and agencies — partner now or lose a major channel.
For more information on this important trend please contact me at gmurray(at)idc(dot)com.
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