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Deep Dive 14 Jul 2021 - 7 min read

Martech unbundles: Brands, publishers eschew Salesforce, Adobe warnings of 'Frankenstacks' for best of breed agility, in-house resource, sharper CX

By Brendan Coyne & Josh McDonnell
Don't fear the Frankenstack

Tales of "Frankenstacks" may be wide of the mark. Brands see competitive edge in martech self-builds. Pic: iStock

A new breed of marketing cloud providers is putting serious pressure on the likes of Adobe and Salesforce as brands and publishers seek a sharper competitive edge. Many are now working to unbundle full stacks they were sold in the first wave of automation, and get a grip on what they actually need – people as much as tech. Shadowboxer's Konrad Spilva and Stephen Graham10 ViacomCBS' Josh Slighting, Amaysim's Karin Kalda and The Lumery's Raj Kumar map out the new cloud landscape and why smart, fast and simple is the future.

What you need to know:

  • Brands are realising vanilla tech stacks mean they have little competitive edge. Many are working out how to unbundle full stacks.
  • Smaller ‘best of breed’ marketing automation players are thriving – and making acquisitions of their own to build out alternatives to the likes of Salesforce and Adobe, without the legacy.
  • Increased competition is also forcing incumbents to innovate – making it a martech buyers’ market.
  • But brands, publishers and consultants say the key to success is a strong data foundation married to the best tech and people – and less is definitely more.

Those that are willing to shirk the big platforms are the ones who have realised they don’t have a unique competitive advantage – just the same tech stack as everyone else.

Konrad Spilva, co-founder, Shadowboxer

A new breed of marketing cloud providers is putting serious pressure on the big incumbents as brands start to rewire systems and question the need for all-singing, all-dancing martech stacks.

Consultants suggest there is a significant push toward unbundling – assembling best of breed systems that service key needs – as brands become more savvy about expensive technology investments.

Shadowboxer founders Konrad Spilva and Stephen Graham think the big cloud platforms have attempted to portray best of breed bolt-ons as “some sort of Frankenstack”. But they think brands are now questioning that narrative.

"We are basically de-platforming from the big players into small, nimble, fit-for-purpose and flexible stacks and ecosystems. We’ll never work with Adobe, Salesforce or SiteCore because our clients don’t see value there," Graham tells Mi3.

"Lots of clients do but for others, there’s a better way, even if they’ve already invested in a Rolls Royce that they can’t get out of the garage. That’s where a lot of clients struggle – they fail to achieve what was promised but then can’t get out of the predicament even if they want to."

Spilva, who built large scale CX platforms for the likes of Qantas during his time at Dentsu’s Isobar, says brands are reluctant to risk ending up with vanilla technology that blunts competitive edge.

“Those that are willing to shirk the big platforms are the ones who have realised they don’t have a unique competitive advantage – just the same tech stack as everyone else,” says Spilva. “That doesn’t do anything to elevate your brand experience beyond anyone else."

He thinks “the future is headless” when it comes to martech, meaning brands must separate out their presentation layer and customer experience from their operational layer and pull together the technologies and APIs to best service those aspects.

But crucially, says Graham, that approach does not also require separate specialist servicing: “Silos shouldn’t exist, because while you can split out parts of the tech from a product perspective, you still need the same team working across its implementation through to how it evolves.”

Once you’ve built a monstrosity, it can be too big and too hard to change. You have to get the business to agree to go in a different direction – and that’s exceptionally difficult.

Josh Slighting, Head of Data and Digital Audience, 10 ViacomCBS

Publisher view: Keep it clean, start simple

10 ViacomCBS doesn’t have an unbundling issue. Like many of the big publishers, it came later to the martech party than other categories.

Head of Data and Digital Audience, Josh Slighting, says that has enabled it to focus on “nailing the basics” and demonstrate commercial outcomes, such as reducing wasted ad spend, while delivering sharper insights for other business units, such as marketing and programming.

He thinks there is no point in over-engineering tech stacks, “because things change so quickly and without a solid foundation, that investment becomes increasingly difficult to sustain.” Relative simplicity, he says, is a good thing.

The late show

“We had something of a late mover advantage,” says Slighting. “Once you’ve built a monstrosity, it can be too big and too hard to change. You have to get the business to agree to go in a different direction – and that’s exceptionally difficult.”

Slighting is thankful not to be in that position. “If I make a business case for further investment, it’s for a value-add, rather than to fix something I sold upwards three years ago. Having that simplified tech stack with a very clear vision from the outset has definitely helped.”

Clean data, build stack

Clean data foundations are crucial, says Slighting, with 10 ViacomCBS adopting a customer data platform (CDP) from the get-go and layering on specialist technologies instead of lumping everything into big cloud bundles.

“We started with audience identity as a core and then added components that support specific use cases, says Slighting.

“Having that solid data foundation is critical, because there are currently 16 different ways that you can watch 10 Play in a digital context, let alone all our various linear channels: on your phone, laptop, or the smart TVs that now make up the majority of BVOD viewing, upwards of 60 per cent. So, the complexity is significant and user experience everywhere has to be excellent,” he adds.

Atop that CDP foundation sit ‘activation engines’. The first is the ad stack, plugging into ad exchanges, 10 ViacomCBS’ own ad management service, Google and the like.

Then comes the martech suite. For email, push messaging and in-app messaging, it uses Braze. “They are a discrete partner; they are not trying to sell us all the different bells and whistles,” says Slighting. “They enable personalised messaging across comms channels, and they make it simple for us.”

The stack also includes Optimizely for experimentation and AWS for storage and advanced analytics.

Walking to wins

After bolting-on those capabilities, 10 ViacomCBS is now training more people to use them. “We’re focusing on a crawl, walk, run maturity,” says Slighting.

After initially focused on the ad stack in order to monetise audiences, it’s now concentrating more firepower on the marketing component. The two areas are interlinked – and there are some basic use cases that can deliver quick financial wins while helping to inform strategy, says Slighting.

For example, how 10 ViacomCBS communicates to its own audiences about the upcoming Survivor and Bachelor seasons. Or to demonstrate media efficiencies from media targeting would be viewers and fans off network rather than those already watching.

“That’s an interesting problem to solve, and mostly because it’s quite challenging to prove. We have the audiences and don’t necessarily have to over-engineer targeting,” says Slighting.  

“A lot of it comes back to the basics of picking the right context and having compelling creative. The challenge lies in the way you quantify the budget you saved without getting the actual match rates from a 'would have bought' pixel or impression’. We are trying to do that, because it becomes a very powerful story with measurable commercial outcomes.

“We're only just scratching the surface of this stuff,” he admits, “but everything we're doing is helping to inform strategy – and importantly, to close the loop and quantify those decisions in real terms so that the business can see the value.”

Be bold in your ask, because it's going to be a hard conversation to justify investment no matter what you do. If you get it right, you're not sitting there three years later trying to justify the investment you made.

Josh Slighting, Head of Data and Digital Audience, 10 ViacomCBS

Funnel vision

Any tips for those now facing the prospect of unbundling, or those now building stacks from scratch?

“My advice if unbundling; stop and take a hard look at things. You’ve got to identify the potential and importantly the limitations of what you are doing sometimes. The danger is that seeing through investments that were not right to begin with only prolongs the inevitable and wastes both time and money,” says Slighting.

“If you have the fortune of starting from scratch, consider your use cases very carefully and be clinical in your investment choices. Less is more, and not every problem needs to be solved with complex technology.”

Otherwise, Slighting says a clear vision is paramount. “What does success look like? Have a defined goal, be clinical – and understand the resourcing requirements.”

Finally, while he says it is important to define core use cases rather than attempt too much, there is no point low-balling the business case.

“Be bold in your ask, because it's going to be a hard conversation to justify investment no matter what you do. If you get it right, you're not sitting there three years later trying to justify the investment you made,” says Slighting.

“If you ask for something that only solves a short-term problem, that might give you a respite for three months, maybe 12, but unless you are sure that there's going to be further investment later on, you're probably better off asking to do it properly the first time.”

In-housing a really sharp skill-set is probably the biggest win I would call out. You can pick the best technology, but ... It is the brains, processes and strategy behind it that determine whether your [stack] approach is a success.

Karin Kalda, Senior Marketing Technology Manager, Amaysim

Brand view: The best resource wins

Brands attempting to simplify their martech stacks is definitely a trend, according to Karin Kalda, Senior Marketing Technology Manager at Optus-owned telco Amaysim.

But she thinks “best in class” is wishful thinking: “Nobody has fully nailed it yet.” More important, says Kalda, are best in class people.

“It is better to invest in one or two really good experts rather than 30 specialist who don’t know how to drive business value,” she says.

“You can pick the best technology, but that alone doesn't do the work for you. It is the brains, processes and strategy behind it that determine whether your [stack] approach is a success.”

Kalda agrees with 10ViacomCBS’ Josh Slighting that adding one useful piece at a time is crucial.

“That has been the secret to our success, because we keep it simple and with a clear direction, it is easier to manage and brings our strategy to life.”

Brands should therefore invest in “best of breed” teams before shopping around for better technology to solve their business problems.

Kalda thinks marrying “best of breed” teams with best of breed technology and keeping things simple helps brands remain agile and avoid problems of their own making.

“That is one of Amaysim’s advantages compared to larger telcos. We don't have these silos, big armies of support. We have minimal external resource, everything is pretty much handled in-house and we have a fairly small team full of experts. Everyone is hands-on and we come together as one unit to get things done.”

De-platform, de-silo, in-house

Kalda, who also provides martech consultancy, has worked across agencies in the UK, Denmark and Australia. She says siloes within agencies and brands can be as much a problem as the technology they choose.

“Orchestrating an army of disconnected teams can become very convoluted. It makes it so much harder to manage any change.” Whereas Amaysim, says Kalda, "can get things done in few weeks that at other places could take six months. So in-housing a really sharp skill-set is probably the biggest win I would call out”.

Brands need to also bring their teams closer together, advises Kalda, so that customer experience is central to strategy – especially if “on-demand” personalisation is the goal.

“It’s crucial to have multi-skilled talent that can take care of the end-to-end experience more effectively,” she says.

“It requires a very specific skill set to connect the dots from a technical perspective, from a customer perspective, and the data [underpinning] understanding,” says Kalda, an increasing challenge across a sector facing a talent crunch.

“In the past, it has been siloed. Now we need to have this multiple skill-set in two, three or four people that come together.

“That is definitely the critical breaking point, because this is a new era – and the winners will be those who have the best resourcing.” 

We are seeing some of those up and coming providers winning some great brands off the back of what they're doing. We are seeing a lot of competition from everywhere.

Raj Kumar, co-founder, The Lumery

‘Martech is now the CEOs challenge’

Raj Kumar, co-founder of Melbourne-based martech advisory The Lumery agrees resourcing is key – and says it starts at the top.

“Nine times out of ten [martech] success comes back to people and process. You can go for best of breed for the entire stack, but that also means that you're going to have to ensure you have people in your organisation that can understand and connect all this technology together,” he says. Which means best of breed versus full stack is not a binary decision. "There has to be a lot of thought and strategy behind it.”

Which is why Kumar believes martech responsibility now goes beyond the remit of marketing, procurement or IT.

“It’s increasingly becoming a CEO issue, because you are not going to ‘solve martech’ in six months. Ultimately you're talking about a strategy that's going to take three to five years to really see through,” says Kumar.

“We're talking about technology that ultimately touches the entirety of the customer experience. So [that encompasses] marketing, sales, service, ops, IT, digital, the entire organisation – and that requires a considerable strategy around your people and process investment.”

A buyers’ market

But for those with strategic intent, Kumar believes martech is now an informed buyers’ market. Competition is heating up, forcing incumbents and challengers to innovate, with brands now far more savvy than the first round of marketing automation.

“There are a lot more options on the table and we are increasingly seeing the right questions being asked… to the incumbents but potentially other entrants,” says Kumar.

“We are seeing some of those up and coming providers winning some great brands off the back of what they're doing. We are seeing a lot of competition from everywhere.”

Consolidation ahead

Competitive pressure is also driving a wave of M&A activity in the market, particularly around CDPs. Salesforce last year acquired Evergage in a bid to counter Adobe’s continuing build out of its Experience Platform, while Adobe this month rolled out a swathe of new personalisation features.

Meanwhile, the ‘best of breed’ players, such as Tealium, Mparticle and Twilio are also tooling up and eyeing up bigger acquisitions of their own.

Kumar cites customer engagement platform Twilio’s $3.2bn acquisition of CDP player Segment as an indication of where the new breeds are heading.

“Twilio’s play is interesting, because it brings together this new kind of stack,” he says, with the market now watching closely to see whether the other challengers “take a similar approach and become ‘the new marketing clouds’”.

“So I don’t think we will see [M&A] slowing down at all.”

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