The current martech agency model is set up to fail
Triggerfish founder and managing director Ben Shapiro reexamines the state of martech, and why Australia may be in for a rude awakening.
It’s interesting to reflect not only how the events of 2020 accelerated a digital revolution, but the impact this has had on digital and technology-led businesses.
In the space of just a few months we saw technology-led projects rise up the corporate priority list, with many big businesses accelerating investments in technology that would have normally taken them years. This seemingly overnight shift was a refreshing development (for the industry) amidst an otherwise difficult year.
The marketing sector also experienced a shift. As digital solutions across all aspects of life were being adopted at an unprecedented pace, businesses expedited investments in ecommerce and digital experience platforms to better engage in their customer’s online brand experience and to drive profitable growth in a highly disrupted landscape.
As a result, this adaptation of corporate priorities has helped fuel the ongoing explosion of the marketing technology industry, now worth a reported $121.5 billion worldwide, with martech spend in developed countries almost doubling in two short years.
The state of martech in Australia
While martech adoption in Australia still lags the US and UK, the past 12 months has seen an increasing number of businesses turn to marketing technology to adapt, which is good news for the industry – in particular martech agencies and digital service providers.
However, while marketing technology is a powerful toolkit that can transform an organisation and help it achieve its commercial goals, it’s also a highly complex landscape that requires specialist skills, in-depth knowledge and understanding, the right partnerships and C-suite buy in in order to be truly effective,
There is certainly still a fear of the unknown when it comes to CX and martech implementations for many businesses. The shortfall on having the right internal capabilities to drive it creates a lack of confidence in martech’s ability to truly transform a business – largely because the business hasn’t experienced what a return on investment could look like.
But with demand for services accelerating post-COVID and business requirements expanding, the future of martech in Australia relies heavily on agencies and service providers having the right people, processes, and operational approach to educate and empower businesses and their people, and to actually guide the martech implementation and CX transformation in true partnership style.
And for this to happen effectively, agencies need to move away from the traditional, hours-based billing model and focus less on their own needs, and more on the outcome needed for the customer. Further, the traditional agency approach and hours-based billing model is not only flawed but the main contributor that limits an agency’s ability to help drive true business transformation.
What it means to be customer outcome-focused
Moving away from an hours-based business model and becoming a customer outcome-focused organisation does not mean that you can’t run a profitable business. Quite the opposite in fact. What it does mean is that you need to let go of traditional services thinking centred around time, price and tech and the outdated view that clients can’t necessarily have all three.
When it comes to using marketing technology to drive commercial impact for businesses there are often three key considerations – time (how long it will take), price (how much it will cost) and tech (the stack required) - and traditional thinking is that you can’t have all three. For example, if there are budget constraints, you may need to compromise on the tech, or if there are time pressures, then it’s likely to comes at a cost.
But this perspective is flawed – the way of the future is to to deliver on all three; that being a timely execution that leverages the best technology, delivered at a guaranteed price (i.e. no surprises!), all while driving profitable growth for the business.
The way to do this is to remain completely focused on addressing the client problem and how to drive growth in their business – and of course creating a delivery plan that keeps everyone focused and accountable. It’s a pragmatic approach that works.
In an industry that’s rapidly evolving, all too often agencies will want to work on exciting new things that may include new products, the latest trends or advanced tech, when its simply not relevant or not the most efficient way to deliver client outcomes. All too often the mindset of trying to serve an individual or agency’s needs is at the expense of really delivering what the client needs.
Instead, to elevate the industry and to empower more Australian businesses to get out of their comfort zones and realise the transformative capabilities of martech, agencies and service providers need to do three fundamental things: 1) become customer outcomes obsessed 2) move away from an hours based-billing model, and 3) develop a pricing structure delivers the best tech, at the right time, and at the right price.
Ben Shapiro is the founder and managing director of Triggerfish.
