Anyone in any doubt about the future of marketing should find the answer in a new report which shows that despite an eye-watering $34bn (£25.6bn) being spent this year in the US and UK alone on technology, half of marketers feel they still do not have all the tools they need.
The study, which saw Warc partner with global accountancy firm Moore Stephens, quizzed more than 500 UK and North American brands and agencies for the Martech: 2018 and Beyond report, which assesses the current and future states of the martech industry in these regions.
Based on the responses received, Warc calculates that the UK and North American martech market could be worth between $34bn (£25.6bn) and $40bn (£29.2bn) in 2017, as around 5,000 businesses offer myriad services (up from just 150 in 2011).
And with budgets expected to increase by an average of 10% over the next year, martech spend could reach between $36bn (£27.2bn) and $43bn (£32.4bn) by the end of 2018.
Warc’s analysis further indicates that brands are spending an average of 16% of their marketing budgets on marketing technology – 7% in-house and 9% outsourced.
In-house spending is currently focused on email marketing and social media, with 85% of brands currently using a tool for email, and almost three quarters using one for social media marketing.
Outsourced spending is going on analytics, measurement and insights, where 77% of agencies are managing a tool on behalf of clients; 54% are managing a social media tool.
The investment demand is driven by a dissatisfaction with the current status, the report says, with half of those polled stating they don’t have the tools they need. Interestingly, when breaking down the figures by agency and brand, around six in ten (58%) of the agency sample state that they don’t believe their clients have what they need and don’t fully utilise what martech tools they do currently have.
Agencies also have a different take on advertisers’ grasp of the technology: 57% say the main barrier to marketing technology investment and use by their clients is a lack of understanding of the technology available, compared to just 25% of brands polled.
Moore Stephens corporate finance partner Damian Ryan said that factors such as fake news, adblocking and a lack of transparency are driving organisations to “invest in technologies to provide them with a greater sense of control” and describes martech as “the industry to watch for the foreseeable future for investment and product innovation alike”.
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