Marketing technologists are great at evaluating the ROI presented by an individual technology when considering whether or not to add it to the stack. But how often do we take a step back and look at how we’re investing our money across our portfolio of technologies?
If you have a 401k, you are likely familiar with the concept of analyzing your investment portfolio. There are a variety of lenses through which to analyze your investments. Perhaps the most common is by asset class. Based on your age and investment goals, you have a target allocation model for what percentage of your investments should be in each asset class. Periodically, you will review your portfolio. If you discover that you are overweight or underweight in a certain area, you can make any necessary adjustments. This ensures your portfolio stays on track.
Marketing technologists should take the time to perform a similar analysis of their investments in their Martech stack. Here are a few different lenses through which you could perform that analysis.
If you have defined your company’s marketing strategies to build your MarTech stack, you should certainly be evaluating your investments against these strategies. Say for example you have defined these three strategies:
- “Differentiate ourselves by adding a ‘personal touch’ to interactions with our clients and prospects”
- “Be first to market with ‘breaking news’ content”
- “Establish ourselves as the go-to resource in the industry for research tools”
You may not value each of these strategies equally. Perhaps, based on priority, you decide the weight of these strategies should look something like this:
- “Differentiate ourselves by adding a ‘personal touch’ to interactions with our clients and prospects” 50%
- “Be first to market with ‘breaking news’ content” 25%
- “Establish ourselves as the go-to resource in the industry for research tools” 25%
Now classify each of your MarTech tools by the strategy(s) they most directly support. Include how much you’re spending on each tool.
How does your allocation model look?
In this example, it appears we may be overspending on our personal touch strategy, and severely neglecting our research tool strategy. Of course, there may be a variety of reasons for this that can easily be explained. You should use this exercise as a tool to kickstart meaningful discussions in your company about how you’re investing your resources.
Gartner’s Pace-layered Application Strategy
Gartner has defined three application categories, or “layers,” to distinguish application types and help organizations develop more appropriate strategies for each:
- Systems of Record — Established packaged applications or legacy homegrown systems that support core business functions and manage the organization’s critical master data. These applications are rarely replaced, and are considered “common ideas” because in and of themselves, they do not offer any competitive advantage.
- Systems of Differentiation — Applications that enable unique company processes or industry-specific capabilities. They may be replaced occasionally (one to three years), and represent “better ideas” that could potentially offer a competitive advantage.
- Systems of Innovation — New applications that are built on an ad hoc basis to address new business requirements or opportunities. These are typically replaced frequently (zero to 12 months) and represent “new ideas” that need to be tested and validated.
If you classified your MarTech tools into these categories, how would your portfolio allocation look? Are you carving out enough money to test new ideas with systems of innovations?
As marketing technologists, we need to keep a pulse on how satisfied end users are with their tools. A good way to do this is to regularly survey end users about their satisfaction with their tools. You could have users rank their satisfaction by:
- Very satisfied – this tool does what I need it to do and does it well.
- Somewhat satisfied – this tool does what I need it to do, but there are some things about it that I’d like to see changed.
- Dissatisfied – this tool makes my job more difficult than it needs to be.
How does your MarTech portfolio look against these categories? Are you spending a significant amount of your MarTech budget on tools that aren’t meeting the needs of the end users?
Just like you do with your personal 401k, you should be analyzing your MarTech stack investment portfolio on a regular basis to ensure that you are spending your MarTech budget smartly and helping your company achieve its goals. What are some other ways you analyze your MarTech investments? Leave a comment and let us know. Thanks for reading!