I recently talked with Benjamin Bloom, senior director analyst for marketing technology and emerging trends at Gartner, around a report he recently published on Marketing Technology Drivers of Genius Brand Performance. (There’s a summary of the report in a blog post Ben wrote, Few “Genius” Brands Successfully Integrate Best-of-Breed Solutions Into a Cohesive Martech Roadmap.)
“Genius” in this context is a Gartner-specific definition. They’ve developed the Gartner Digital IQ Index to benchmark the digital performance of brands relative to industry competitors. It supposedly measures “more than 1,250 data points across four dimensions of digital.”
You can see the rankings of the top 10 brands in a number of different industries, mostly consumer, here. (Cleverly, to see the rankings of brands below the top 10 — potentially yours — you have to become a Gartner client.) For example, here’s the ranking for speciality brands:
In Gartner’s ranking hierarchy, they label brands Genius, Gifted, Average, Challenged, or Feeble — from hero to zero, respectively. I’m not sure if their nomenclature was intentionally tongue-in-cheek, or if I just find it such. “Genius” and “Feeble” are a tad hyperbolic, no? On the other hand, I’m sure it stirs discussions, which can be a helpful catalyst for change.
Speaking of stirring discussion…
Ben’s report had a simple but brilliant premise: map brands on a two-dimensional graph by their Digital IQ on the y-axis and the size of the martech stack on the x-axis and see if there was any correlation. The resulting chart is at the top of this post.
It reveals a positive correlation between martech stack size and digital IQ.
Genius brands tend to have larger martech stacks, with 55+ products in them. Feeble and Challenged brands tended to have small martech stacks. It’s tempting to make the low-brow remark that, hey, when it comes to martech stacks, size matters.
But not so fast. First of all, stats 101 reminder: correlation is not causation.
Second, as with other things, it’s not just size. It’s in the way that you use it. (Sorry.)
There are plenty of Gifted brands, and a few Geniuses, in the upper left quadrant of the chart that have high Digital IQ and small or modest stacks. You also have a few Challenged and Feeble brands in the lower right that have large martech stacks but still suck wind, digitally-speaking.
Ben describes that lower-right corner as martech “sprawl.” A bunch of products in their stacks, but clearly not organized into cohesive digital business capabilities. He labels the upper-right corner above it — lots of martech, but high Digital IQ — as “complexity.” These are complex digital operations. But they’re extremely effective.
This is an insightful distinction. Martech sprawl is unquestionably bad. But martech complexity isn’t necessarily a bad thing. In fact, it may very well be integral to the competitive advantage that these brands wield.
Best-of-breed stacks for best-in-class brands.
And these are best-of-breed stacks. To quote Gartner’s report (emphasis added is mine), “Genius brands do leverage technologies from [large martech suite] vendors, but point solutions account for nearly three-quarters of the technologies in their stacks. By comparison, less-savvy brands have a greater share of products from [larger] martech vendors among their portfolios.”
But these high Digital IQ brands manage the combination of major martech platforms and specialized point solutions in a highly disciplined fashion. They methodically collect and document uses cases, and they measure deployment and adoption of new martech tools against their impact on company revenue.
Of course, there’s plenty to debate here — and enough ambiguity in the data to serve as fodder for such disputes. We can “take it outside” to LinkedIn or Twitter, if you like.
For the record, my view is:
- A version of Occam’s Razor applies to martech: the simplest effective stack is best — but no simpler. Advantageous complexity, well-managed, can be a source of competitive strength.
- Point solutions integrated around a common platform are better than point solutions isolated in silos. (Yes, I’m biased on that view.)
- All the martech in the world won’t help you, if you don’t have a great product or service, if you don’t treat your customers well, or if you don’t hone your craft of great marketing on top of these technology-powered capabilities.
What do you think?
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4 thoughts on “The larger your martech stack, the better your marketing performance? Maybe”
Interesting, but the invisible hand behind all of this is budget. In our more than a decade of research on this at IDC, it turns out that underneath it all is budget. The bigger the budget and more coordinated the spend the better the stack and the skill sets around it (both mktg and IT). Also counting platform v best of breed on a nominal basis is overly simplistic to the point of being misleading. Its about the budget curve across the tech not the number or mix of systems that matters. Very difficult to normalize for those factors but they are highly correlated and obvious when you think about it. So, yes, you need a board and surfing skills but Its 100% reliant on the motion of the ocean. Or, the best get better faster than the rest.
Good points. I assume the bigger the budget relative to your peers? i.e., for a $1 billion company, how much money they invest relative to other $1 billion companies? The correlation between coordinated spend and skill sets also makes sense.
No doubt that more budget correlates with bigger stacks and better results. But, again, correlation vs causation: do they have bigger budgets because they do a better job, or do a better job because they have bigger budgets? As Scott asks, is there any correlation between stack complexity and performance for companies where budgets are the same?
Business drives the on-boarding of martech stack. To achieve business outcome, if existing platform / technology cannot fulfill the outcome then there is a need to onboard something new which can bring better results ( revenue ).And, of course budget will come along that will justify the technology cost to achieve the ultimate outcome.