Maximizing martech’s impact: Insights from The CMO Survey

The latest edition of The CMO Survey shows contradictions which, in my view, hinder the realization of marketing technology benefits and ROI. 

The CMO Survey is conducted biannually since 2008. The spring 2024 report includes data collected during Q1 2024 from CMOs across various industries and company sizes. Here, we will analyze the marketing technology portion of the report. 

Increasing investment and ongoing integration challenges in martech

Most companies plan to increase their martech budget annually, from the current 19% of the marketing budget to 23.5% next year and 30.9% within five years.

However, about 60% of CMOs surveyed also reported having annual or quarterly marketing technology audits or implementation projects. This means companies and CMOs seem to keep on buying new martech tools while they are still evaluating or implementing the ones they already have purchased. 

Since marketing technology is supposed to work together as a stack, how can companies determine what they should look for in a new platform if the timeframe of such evaluations seems to overlap with the process of buying new platforms? 

Another interesting data point is that only 62.1% of marketing activities use marketing technology (up from 58.4% from the previous year). Maybe this ongoing expansion in investment is correlated to growing marketing technology usage throughout all marketing activities (more on this below).

Dig deeper: The sticky problem of martech integration

The disconnect between martech purchases and company goals

Aligning with the company’s goals is the top priority when adopting new marketing technology, according to the CMOs surveyed. On a scale of 1 to 7, CMOs rated:

“Optimizing or streamlining existing tools” at 5.3. 

“Identifying martech tools for stronger customer experiences” at 5.1

“Linking martech tools to form powerful capabilities” at 5.0. 

The lowest priority is “Hiring or retaining talent for implementing/managing martech strategy.”

However, the company’s goals can change yearly (which may be one of the reasons why companies keep buying martech tools). There is less focus on aligning martech purchases with company strategy or customer experience, which could support long-term goals and enhance martech value over time.

This affects how well marketing activities are matched with the right technology platforms, highlighting the operational role of martech and the challenge of making it strategic.

Underutilization and moderate performance of martech stacks

Meanwhile, the question “Considering all the martech tools purchased by your company, what percent is your company currently utilizing in its operations?” shows companies are, on average, using only about 56.4% of their current martech stack in their operations. 

When asked “how well your company is performing each of the following marketing technology activities,” on a scale from 1 (poorly) to 7 (very well), CMOs responded as follows:

“Selecting the right company to provide marketing technologies” and “Selecting the right mix of marketing technologies” both rated 4.9.

“Designing the broad architecture of our marketing technology systems” rated 4.4.

“Generating ROI from marketing technologies” and “Developing capabilities for using marketing technologies” both rated 4.5.

“Integrating marketing technologies into our customer funnel,” “Leveraging data for tactical decision making” and “Leveraging data for strategic decision making” all rated 4.6.

It seems CMOs are reporting that marketing technology is performing at moderate levels only and that their teams perform better at selecting the “right mix” of marketing technology tools, even though these tools (or at least part of them) seem to be audited annually or quarterly. However, designing the broad architecture of the martech stack seems to have a lower performance. 

Again, this may be because marketing technology does not seem to be aligned with all marketing activities. Maybe companies cannot fully use their current martech stack because they are too busy auditing existing tools or writing specs to buy new ones.

Dig deeper: How marketers can help boost martech utilization

Evaluating martech effectiveness: Are we missing the bigger picture?

For the question “Which of the following metrics does your company use to evaluate the effectiveness of your martech systems?”, CMOs’ answers indicate that martech’s main focus is on lead generation (top-of-funnel), while bottom-of-funnel and long-term customer value metrics trail behind. 

Is this one of the main reasons why martech investment grows every year while the current stack is being audited and sitting 50% unused? Are stakeholders expecting the next marketing technology platform itself to improve this activity? What about all other marketing activities related to other parts of the buying funnel? What about connecting the current stack to other activities to better realize the martech stack’s value? 

This may be one of the main reasons for the contradictions in this report. Martech seems more aligned with top-of-funnel activities (such as lead creation of customer acquisition) instead of mapping it to the entire customer journey/buying funnel activities. This is not because of the technology itself: most martech tools can be connected via API calls to send data from one to the other, thus, allowing data to flow throughout the different stages of the buying funnel and not only in top-of-funnel activities. 

Dig deeper: How to use conversion data to enhance top-of-funnel marketing

This is an adjustment on the marketing side. Marketing technology can and should be used throughout the entire funnel. This is the only way to assess how marketing technology can adhere to the company’s business objectives and improve marketing processes to realize ROI and better inform CFOs. This is the only approach that can realize the value of marketing technology investment. 

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