9 Top Martech Trends for 2020

 

As 2019 draws to a close, Simple took the opportunity to reflect a little on some of the martech trends that moved the needle this year, and where we’re likely to see activity concentrated in 2020, from conversational marketing to the application of AI across marketing. Here are our top picks.

 

 

1. Total marketing budgets will contract, but martech spending will rise

According to the annual Gartner CMO Spend Survey for 2019-2020, which surveyed more than 340 marketing decision makers from the UK and North America, top-line marketing spend will contract for the first time in 5 years to 10.5% of company revenue, a level not seen since 2014.

Last year, Gartner reported martech spending rose to 29% of total budgets – for the first time making it the biggest of the big 4 budget areas, which also include staff, media and agency costs. Typically these hover at around the same level – 25% give or take a few percentage points. Next year, media spend will go up slightly, agency spend will continue to decrease slightly and martech spending will also go down a few points to 26%, according to Gartner.

However, the global marketing technology market is now valued at an estimated $121.5 billion, a year-on-year increase of 22%, according to Martech: 2020 and beyond. That growth is unlikely to reverse overnight given the continuation of many of the factors fuelling it, including advances in technology that draws audiences into new channels, resulting in the need for teams to consider investing in new areas – and growth in areas companies can’t afford to ignore for long, such as artificial intelligence.

In the current cautious economic climate, we don’t expect martech spend to continue increasing at the same rate, but we expect it will grow steadily. With teams only utilising approximately two-thirds of their current martech tools’ capability, according to an earlier Gartner study, the current toolset will continue to be reassessed, economies made in the continuing rationalisation of tools that only serve a single purpose, and better use made of platforms that perform multiple tasks while investment continues in new and developing areas.

“Marketing leaders continue to view martech as a tool for driving customer engagement and account growth,” Gartner concludes.

 

2. Marketing operations drives continuous transformation

Another very interesting trend is the rise and rise of marketing operations. According to Martech: 2020 and beyond, the top priorities in martech budgets for next year are market research and competitive insights (named as a top-three priority by 32% of respondents); marketing analytics (32%); digital commerce (31%); and marketing operations (30%).

The emphasis on marketing operations next year reflects not only the need for teams to get full value out of their martech spend, but to better manage how marketing teams operate to get work done. Increasingly this includes digital technology implementation, project management and a strategic focus on improving the business management at the core of marketing activity. For many teams, a strong marketing operations function underpins the continuous digital transformation they now need to undertake.

 

3. AI will be used to improve all aspects of marketing

Half of all companies (49%) already have an artificial intelligence strategy in place, according to Microsoft, with early adopters in the UK seeing a 5% improvement in productivity, performance and enterprise outcomes compared with companies that don’t have an AI strategy.

So what can we expect in the rapidly developing world of AI in 2020?

From the use of natural language processing to understand and improve customer service and customer engagement, to collating and providing deeper data insights for increased personalisation, the range of uses to which AI will be applied in marketing is growing.

The use of chat-bots with the capacity to understand natural language queries is just one of the more obvious examples.

According to Simple’s chief data scientist Suresh Sood, 2020 will be the year AI revolutionises the marketing brief.

“In 2020 artificial intelligence comprising natural language processing, computer vision and machine learning brings greater context and relevance to every marketing brief,” Sood predicts.

“Nearly a century ago the marketing pioneer John Wanamaker made the observation ‘Half the money I spend on advertising is wasted; the trouble is I don’t know which half’.

“Now, we will finally be able to determine, from our planning, the best performing briefs, campaigns or activities.

“A significant reduction of marketing waste takes place when — rather than spraying and praying — we truly operationalise our market planning down to the level of our strategic communications, targeting and brand positioning.

“In this scenario, AI will assist marketers in the execution of marketing strategy by predicting, providing answers and feedback to:
• What criteria should I use to assess the marketing performance of this brief, campaign or activity?
• Who are the competitors relevant in the context of this brief?
• Are insights from customers available for consideration?
• What are the mandatory legal and regulatory considerations for this brief?
• What type of media should be used and what is the estimated timeframe to achieve the communication objectives?
• Recap my brief aloud in Japanese for my colleagues in the Tokyo office
• Repurpose and show me the brief for this campaign for our employees and investor relationships.

According to Sood, this investment in AI will pay dividends in terms of increased tenure for CMOs.

“The practical application of AI to predict and improve marketing outcomes turns the tide and increases the tenure of the chief marketing officer and the marketing team. Furthermore, this attention to using artificial intelligence on the process of market planning is the best strategic investment an organisation can make in 2020 not only optimising customer experiences but delivering significant costs savings to the business.

“Eventually, briefs will utilise marketing and company data with AI to automatically write the brief as well as provide guidance for execution covering creative keywords and local area marketing differences.”

 

4. Investment in conversational marketing will increase

Conversational marketing was mentioned as a key innovation in the latest Gartner hype cycle. But what exactly is conversational marketing?

Conversational marketing is engaging with customers in real time, at scale, to give them what they want when they need it.
It mimics the conversational tone of human conversational messaging, but really, it’s about immediacy.

Often fuelled by AI in terms of using natural language processing to understand queries in intelligent chat bots, conversational marketing aims to engage customers in a conversation as soon as they hit your website in order to get them what they want with minimal attrition. If they want to speak to a sales person, for example, they no longer need to fill out a form, send an email and wait to be contacted: they can simply ask and your chat bot can make them offers or recommendations in order to move them through your funnel faster or help solve their customer issue.

But while this is one of the more significant technologies to hit the mainstream in the next year or two, it is near the ‘peak of inflated expectations’, according to Gartner’s hype cycle. So while it should do a better job of converting visitors to leads, leads to opportunities, increasing customer engagement and improving customer satisfaction, remember conversational marketing can’t conjure intent to buy out of thin air.

 

5. Platform-based ecosystems will expand reach and influence

Arguably the one single thing preventing martech from delivering on its promise of a scalable, measurable, smoothly functioning marketing engine is the difficulty integrating all the various technologies that teams use.

Almost one in three marketing leaders say their marketing technology is not delivering, with CMOs and other marketing executives expressing frustration with the lack of integration between marketing tools and even within platform-based marketing clouds.

But in 2020, we’re predicting marketing teams will increasingly turn to platform-based ecosystems to help expedite integration between tools by leveraging pre-existing connectors.

According to Scott Brinker’s Chiefmartec, that means marketers will be able to combine the best of their preferred marketing cloud “augmented by large ecosystems of specialised third-party apps that are more deeply integrated”.

 

6. Position zero and the new search frontier

Search engine optimisation is shifting from keyword-matching to intent-matching at pace, fuelled by the growth in natural language processing.

Coupled with this, voice-based search is growing, particularly over home devices and mobile, which again emphasises the importance of natural language searches; at least 20% of voice-based searches are conducted on mobile devices.

In 2020, this trend is expected to bite. comScore famously predicted 50% of all searches would be voice-based by 2020, while Gartner opted for a more modest 30%.

Either way, it’s significant: according to PwC, two-thirds (65%) of 25-49 year olds speak to their voice-enabled devices at least once per day — though not for all types of queries;  music, news, weather and local search were among the favoured voice search topics.

Meanwhile, the structure of content will be critical to businesses – particularly those that expect voice search to be a factor for them, with many of them drawing from ‘position zero’ search snippets that summarise key points.

Mirroring that trend, is the rise in zero-click searches, in which consumers get the information they need from the home page of their search results.

“More and more brand marketing is happening on Google itself, and not necessarily on your website,” according to Search Engine Journal. “Smart marketers will need to learn how to adapt and take advantage of this by getting more strategic about the information shown in search snippets.”

Marketers will need take account of the increasing emergence of visual search as a key influence.

 

7. Increased emphasis on improved marketing process automation

When faced with tightening macro-economic conditions, is it better to reduce marketing activity, cut staff or tighten your belt by generating efficiencies in other ways?

On the cusp of Brexit, a warming climate and data security issues increasingly affecting businesses around the world, marketing teams may find that added pressures are brought to bear on budgets beyond the regular budgeting and reforecasting periods.

Put simply, additional moves to rein in costs will mean that marketing teams that continue to employ inefficient, manual processes to get their day-to-day work done are in for a wake-up call.

Reflected in the growing interest in work management tools in 2019, 2020 is likely to see enterprise marketing teams look to automate as many of their processes as they can.

Campaign approvals will no longer wait for the planner to send an email to legal – legal will be notified when a campaign is ready to be approved and as soon as it has been approved, it will be released to the next part of the process.

Meanwhile, next best action recommendations to join up marketing processes across channels will be key, along with continuous planning that incorporates near real-time results and enables brands to respond to changing circumstances in an agile way.

“Marketing is going to continue to be squeezed in terms of budget while at the same time being challenged to show how they are generating results,” according to Simple lead product manager Stephen Preston.

“One to one real-time next best action marketing is going to continue to be a driver for many companies which will continue to stretch siloed channels and make joined-up messaging across all channels incredibly important.

“Meanwhile, planning is no longer simply a one-off event that happens once a year, but instead it will continue to be something that is done on an ongoing basis, with marketing needing to adapt quickly and understand the impact of a change.

“The plan must be able to adapt and evolve quickly to cope with the demands of digital marketing and changes in market conditions.”

Collaboration will become a competitive advantage in the same way that AI-fuelled chatbots are revolutionising customer service.

 

8. Inhousing/DIY marketing continues to grow

Inhousing is likely to continue at pace in 2020, incorporating the trend towards DIY or make-it-yourself marketing.

What does this mean? More marketing skills are being taken in-house, from SEO to content marketing, to video production – although high-end brand campaigns will remain the territory of external agencies.

According to the ANA, 78% of marketing teams have some form of in-house agency and the trend is accelerating, having risen from 58% five years earlier.

That makes areas such as online video (and related technologies) a rapidly growing area in 2020: and it also means that if you don’t have anyone who can script and shoot a low-budget video in-house, perhaps it’s time to find them.

Managing and prioritising requests into marketing becomes a much more important skill in this scenario, supported by the right workflow management technology.

But beware: measuring the outcomes and impact of your campaigns is critical, as is knowing the cost to produce those campaigns in time and staff resources, compared with how much it costs to outsource them.

If the right processes aren’t in place, and you can’t show that your internal agency saves you money, you’ll be back on the outsourcing bandwagon before you know it.

 

9. Citizen development: A new skillset

Last but not least, let’s not forget the growth of citizen developers, made possible by the emergence of low- or no-code development platforms.

According to Chiefmartec again, this trend is about empowering non-technical marketers to build apps, analyse data sets, and route data between different cloud services on their own, without having to take a ticket and wait for IT, or even marketing ops, to do it for them.

It’s a trend companies such as Zapier and Microsoft have grabbed with both hands, Zapier by enabling non-technical people to connect different technologies, and Microsoft with its investment in the Power Platform, which enables people to analyse data, build solutions, automate processes, and create virtual agents (bots) – all without having a technical background.

The demand for low-code platforms is increasing, according to Forrester, which found 23% of global developers are already using one, with a further 22% likely to do so in the next year.

In marketing, this means that if the marketing cloud at the heart of your martech stack allows, your marketing team will be able to start creating its own apps in response to customer or organisational needs — making it arguably more agile and nimble than it’s ever been.

So there you have our top martech trend predictions for the year ahead. In this analysis, we recognise we haven’t even touched on some of the big headline tech trends, such as blockchain, augmented reality and personalisation (which we think are more likely to become a mainstream reality in the years beyond 2020).

But whichever way trends in martech develop, here’s hoping 2020 ushers in a new era of prosperity for your team and your brand!

 

Simple’s Marketing Solutions can help your marketing team market smarter, faster and leaner. Reach out to one of our consultants for more information.