The Jordan Edmiston Group, Inc. (JEGI), a leading investment bank in the marketing and media space, recently released a new report on the enterprise marketing management (EMM) stack. They start by noting that from 2010-2012, four companies (“The Big Four”) have invested over $20 billion in marketing technology M&A: Adobe, IBM, Oracle, and Salesforce.
But they quickly point out that some of the biggest disruption resulting from these acquisitions hasn’t been in the enterprise software space — it’s been in the marketing services space. “Their world has virtually turned upside down,” they note.
To make their point, they share two upside-down quotes from industry executives. First, this one:
“Despite all of this technology at work, the most critical element in our evolving service mix is world-class creative capabilities.”
Think that statement came from an agency? Nope. It was made by the CMO of a leading IT service firm. Here’s the other one:
“Our role is to serve as a systems integrator for our clients… to help brands tell their stories via marketing technologies and application programming interfaces (APIs).”
Sounds like a typical IT integrator, right? Nope. That statement came from the chief strategy officer of a global agency group.
It’s clear that agencies and IT/consulting services will be duking it out over the CMO’s increasingly technology-driven budget and attention. What’s interesting is that this strategic battle seems to be converging around the different layers of the EMM stack, as illustrated by JEGI’s graphic at the top of this post.
But lest you think that software vendors are safely above this fray, take a peek at companies such as Fabric, a “marketing operating system” that is backed by WPP and and has a strategic partnership Infosys. (Theirs should be the textbook definition of a “frenemy” relationship.) Or Code Worldwide, backed by Omnicom, that has been ranked by Gartner as a visionary in the marketing resource management (MRM) software space, competing with software providers such as SAP, Orbis, IBM, Aprimo, and MarcomCentral.
Or, in the other direction, consider that IBM and Oracle, two of the Big Four in enterprise marketing software, both generate a huge portion of their revenues from professional services.
The marketing technology frenemy triangle is heating up on all sides.
P.S. It’s also interesting to think of the major software players who are not yet very active in this enterprise marketing M&A frenzy. Strategic choice? Strategic oversight?
P.P.S. One quick update. Paul Roetzer of PR 20/20 alerted me to this great post on their blog: Will SaaS Companies Build Internal Marketing Agencies?