- B2B organizations are increasingly keeping an eye on marketing technology spend, which makes evaluating the spend more important
- A straightforward comparison of the level of spend to the industry is only part of evaluating the value and potential of marketing technology
- Evaluating marketing technology spend systematically can allow organizations to take corrective action when there are shortcomings
Of the information that we share on our budgeting benchmark reports, falling behind the benchmark in marketing technology spend is one of the areas that our clients tend to react to the most. It sounds surprising when you consider that marketing technology accounts for only up to 8 percent of the total marketing spend at the most, and typically less than that. While many companies in their pursuit to build and run a lean marketing organization, are comfortable with spending less in programs or personnel as compared to the benchmark, it’s not typically the case with marketing technology spend.
Spending on marketing technology has become the norm and not spending as much as the benchmark is now seen as a competitive disadvantage. B2B executives with buying power, either in the marketing function or outside, understand that capitalizing on marketing efforts is difficult without proper technology. There is also a general perception that when it comes to marketing technology investment, you get what you pay for.
While different platforms will come at different price points based on the range and depth of their features, just spending the money rarely guarantees the effectiveness of the tool. There are at least five elements to consider when evaluating whether an organization is making the best use of its marketing technology dollars:
- Implementation. Not all systems come ready-to-use right out of the box. Many need a configuration and set-up that can require a big time commitment in order to support internal processes properly. Organizations need to ensure that the processes are the first to be outlined in detail, and then built into the system. Cutting corners on implementation can have big repercussions when it’s time to put the system to use.
- Integration. It’s due to integration that all systems taken together can have an effect that is worth more than the sum of the parts. Typically, it’s not a requirement for any one marketing technology to be integrated with other systems in order to function. However, it is a large missed opportunity in terms of time saved consolidating reports and effectiveness in seeing trends, when systems run in isolation and cannot exchange data with one other.
- Training. How many of the likely users have been through enough training to be able to navigate the tool? Ideally the answer would be “all of them”. But basic training alone is not a great indicator of successful use. Many vendors are now offering certification programs to make sure users are well versed in making the most of the system. These will often come at a cost, of course, but they tend to lead to more users that are inclined to explore the system further and continuously train themselves to discover and adopt the more advanced features.
- Adoption. A powerful expensive system that isn’t used isn’t worth much in return. Adoption is also a difficult part of ensuring organizations are making the most of marketing technology spend. While it is possible to control implementation, integration or training, adoption is typically not forced and sometimes difficult to measure. The good news is that adoption can be influenced, but keep in mind that there are at least two aspects to adoption and each will need to be influenced differently. The first aspect, or the percentage of intended users that access and utilize the tool on a regular basis can be influenced through communication, executive sponsorship or more cutting edge approaches such as gamification. The second aspect, or the percentage of features that is leveraged on a regular basis, might be an indicator of either more bells and whistles than the organization needs, or low awareness and/or ability to apply advanced features.
- Results. Organizations need to put in place measures of gains due to the adoption of marketing technology. The biggest expectation about marketing technology is that it will make work more efficient, which tends to also be the more direct result of marketing technology spend and easier to track. One way to get to an estimate is to make a list of routine tasks, and compare the average time it used to take to complete them with and without the system. More indirectly, marketing technology also can increase visibility into the impact that marketing is having with different activities, to better support data-driven decision making. Best practice companies have developed rules and programs to respond with when marketing systems show business indicators in certain ranges or brackets.
Want to get really fancy with your evaluation of marketing technology spend? Create a scoring system to capture your assessment of the above elements. This can turn into a year-over-year exercise that might be just the push to drive the organization towards the best use of that spend. Share with us below if there are any other elements you have in place to evaluate your marketing technology spend.