

Discover more from B2B Wins by Steve Zakur
B2B Wins #1: Are you wasting 58% of your Martech budget?
Maybe more. Maybe less. But that's a good ballpark figure.
58% Really? That seems high...and yet it rings true.
A recent Gartner Survey found that marketers are utilizing just 42% of the capabilities in their Martech stack. And that's down from 58% in 2020.
I talk to B2B marketing and technology execs all the time. Last week I talked to two and got some version of the following.
"I'm only making use of about half the function in [INSERT POPULAR TECH PLATFORM] and I have no budget to hire folks to leverage the remaining value."
One exec said the utilization of one tech platform is in the single digits. More than 90% of the potential is being wasted. Ugh.
Why do B2B marketers waste so much Martech spend?
According to Gartner survey respondents it is largely due to:
significant amount of overlap among marketing technology solutions (30% of respondents),
difficulty identifying and recruiting talent to drive adoption/utilization (28%),
and complexity/sprawl of the marketing technology ecosystem (27%).
Let’s break those down a bit.
I get the overlap problem. A marketing automation suite has one function but it’s not core to the platform and isn’t very good. For example, a platform with a strong email capability may have inferior social tools. So you purchase a social management tool to fill the gap. Overlap. I see this a lot in SEO tools.
This problem is largely unsolvable if you want need world class capabilities in each functional area within marketing. That said, I’ve talked to SEO experts who have the “best” tool—some might say Conductor— and they’ll admit that they could probably get by with something less robust (and costly). But when you’ve got a Mercedes, do you really want to go back to driving something that is lesser.
Let me skip to complexity and sprawl. This is exacerbated by shiny object syndrome. As B2B marketers we have many problems and are in search of balms for our pain. There are many vendors plying the latest buzzwords and if that’s the grail, we’d like one please. When there’s a newer, better grail. Well then one of those too. Thank you.
A similar problem manifests itself when each unit’s marketing organization is buying tech that suits its needs. This is a key source of wasted Martech spend. I had a Salesforce Account Exec tell me that we already had unused seats elsewhere in the company as they delivered a proposal for “optimizing” those seats. Of course, that included selling us a few more seats…there are no free lunches.
The big challenge that B2B marketers face is the human resource problem. Gartner phrases this as a recruiting problem. Maybe. I think the bigger problem is that operating the technology was probably an after thought when buying the tech. That may seem a bit harsh but anyone who has implemented new tech understands how this could unintentionally happen.
The adoption of a new technology often focuses more on the adoption phase than operations. Onboarding. Myriad technical wiring. Training of initial staff on high priority use cases. Hyper-care phase.
That’s often where the budget has been allocated. License fees. Start-up fees. CIO resources. And when finance puts a little pressure on the budget, what gets cut? The license fee? Not likely. We decide not to enable one or two modules. Those will happen in the mythical Phase 2. When will that be?
So we’ve got fewer of the capabilities enabled in Phase 1. What about the people who are going to operate the enabled capabilities? Are they in place? Can they train folks in other business units? Do they have the time to work on fully exploiting what they have and figure out new function that wasn’t fully enabled at launch? Probably not.
What should you do if you’re in this position?
If you’ve ever worked at a large enterprise, all of the above rings true. What’s surprising about Gartner’s research is how unsurprising the findings are. They all sort of ring true though I think the people problem—enough people with enough skills—is WAY understated. Way. Understated.
Say you have a friend in this position. What would you recommend they do? Here are some things I’ve seen work.
What you measure is what you get
A buddy of mine says that B2B marketers came to marketing as a refuge from math. That’s far less true than it used to be but one of the reasons that we often get such poor utilization is that we do a poor job at measuring it.
The fact that we need Gartner to tell us what we should already know—and already know in our hearts—means that we’re not doing a good job at measuring our utilization of new technology.
Right from the start you should have measurements of the utilization of the platform.
How many modules are deployed?
How many people are trained on those modules?
How many of those are actually being used?
What percent of users log on during a specific period?
Note that these measures have nothing to do with the business results. It’s simply answers the question: Are we using this thing? These measurements aren’t just for the deployment. These measurements have to survive the adoption project and get embedded in your operational metrics.
I know it’s tough to find someone to help with these metrics so lean on your vendor Account Exec or Customer Success person to help. Don’t they want to make sure you’re making the most use of the tech? Don’t they want a renewal? A customer reference? Of course they do. They’ll help.
Begin with the end in mind
You have the greatest leverage with your vendor when you’re negotiating the contract. There are two things you should ensure that you do:
Make function adoption part of the contract: The only thing that vendors really respond to are financial incentives, so ensuring that there are performance elements to the contract is critical. Your vendor negotiates agreements all the time and you only do it occasionally. Get an expert to help you here. This is a place where your procurement team can help you out. If they’re not familiar with techniques for extracting commitments from the vendor then send them to school (or Google) to figure out how to do this. If there are capabilities that you’re not going to use until later then get some concessions. Either you pay for it later—perhaps in the second year of the contract—or you get some additional vendor support later when all your internal project resources are gone.
Interrogate each function available: This is on you and your stakeholders. Most technology—especially large integrated suites—do some things well and some things…less well. You only want to pay for what you’re using. For example, if the CRM system that you’re purchasing has great email but crappy social management tools make sure you suss that out and don’t pay for what you’re not using. Get demos and do feature bake-offs for every key element. Pay for value. Skip the things you know you’re going to have to replace.
Negotiating with vendors is a speciality. It’s where things often come off the rails as far as value realization. The additional effort that you put in here will pay dividends later.
Don’t outsource tech decisions
Buying tech is hard. There are some folks who can be critical in helping with the process. As stated above, procurement can help. Your stakeholders, the people who are going to use the tech, need to be involved from start to finish.
So who shouldn’t take the lead?
Your Agency: Your agency may have a lot of experience with companies like yours and with technologies that you’re considering. They’re going to be a good advisor in the process especially for technology they’re going to be responsible for using. That said, they have more of an incentive to make their lives easier than to make your life easier. So, take their counsel, but don’t put them in the lead. This is especially true if they’re guiding you to tech that may not be broadly adopted in your industry. Unique tech may make it harder to change agencies in the future.
Your CIO: As a former CIO, I know how tough this one can be. The CIO may hold the budget for your Martech. The CIO will likely be needed to help integrate the the tech stack. They are a key partner. Definitely involved. Not in a lead position. They’re not going to be responsible for delivering the business results from the system, you are. Early roles and responsibilities discussions with the CIO is critical.
Don’t outsource. Don’t just get involved. Lead. Your job is to lead the tech decision process even if it’s not your budget or you’re not going to own the IT operations. The CIO and your agency can be good partners in the process but if they’re leading the efforts you’re going to be inheriting something that may not meet your needs. If it doesn’t meet your needs you’re not going to use it. More Martech wasted spending.
In Summary
Nothing that you purchase is going to 100% hit the mark. Some “waste” in the tech stack is inevitable. But 58% waste is clearly not the right answer. Measure Martech utilization to guide your decision making. Ensure that your purchase decisions take into account adoption and utilization. Lead the purchase efforts to ensure the best possible outcomes. This is solvable. It’s on you.