has martech moved the needle for smbs?

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Has Martech Moved the Needle for SMBs?

OMMA Marketing TechNew York, NY

Rick DuceyManaging Director

BIA/[email protected]

May 18, 2016

@rducey@biakelsey

2© 2015 BIA/Kelsey. All Rights Reserved. |

About BIA/KelseyAdvisory research firm helping clients with strategies and local market intelligence



Martech LandscapeSMBs Are Big Part of Ad EconomyBeyond AdvertisingSMBs Disrupted and Disrupting

Topics for Today


Martech Starts With Knowing Who Your Customer IsLots of “tech stacks” to do martech, typically starts with a good CRM system


Martech is an Easy Space to Follow . . . Not!


SMBs are an Impactful Part of the EconomyProvide over half of all jobs and sales in the U.S. According to US Small Business Administration: “Small business is BIG!” The 28 million small businesses in America account for 54% of all U.S. sales. Small businesses provide 55% of all jobs and 66% of all net new jobs since the 1970s. The 600,000 plus franchised small businesses in the U.S. account for 40% of all retail

sales and provide jobs for some 8 million people.


2015 2016 2017 2018 2019 2020$0

$20$40$60$80

$100$120$140$160$180

$50.3 $52.4 $53.7 $56.4 $57.9 $60.9

$34.7 $33.0 $33.3 $32.0 $32.8 $34.6

$56.3 $61.2 $62.7$67.9 $69.7

$73.4

SMB Advertisers Non-SMB Local Advertisers

Billi

ons

SMBs Increasing Ad Spend by $10.6B 2015-2020BIA/Kelsey Defines SMBs as Under 100 Employees

Source: BIA/Kelsey, October 2015


Martech is Moving the Needle for SMBsSMBs are shifting their marketing strategies to embrace digital Tech platforms and solutions that used to be “enterprise sized” are becoming increasingly

right sized for the SMB market. It’s about the DATA. Martech solutions are bringing customer data full bore into the marketing mix to evolve

customer relationships and engagement. But what has been the affect of these solutions on small-to-medium-sized businesses? How have SMBs combined martech solutions with paid search and other digital marketing

platforms?


In 2011 Gartner’s Laura McLellan predicted the rise of technology spending in marketing budgets due to the rising strategic importance of marketing and tech.

80% of companies now have a “chief marketing tech” by title or role. Companies are reducing their sales budgets in favor of marketing budgets. Gartner’s latest CEO survey shows that, “CMO budgets are increasing, distinctions

between digital marketing and marketing are vanishing, and digital commerce has become the mandate for driving profitable growth.”

What is the Role Marketing in Companies These Days?“By 2017 the CMO will Spend More on IT Than the CIO”*

*2011 Gsrtner survey.


ActiveCampaign AutoPilot BoingNet Intellasphere InTouch JumpLead Leadsius Nurture SalesAutopilot SimplyCast Spokal Wishpond

Martech Platforms Targeting SMBsExamples of Vendors Offering Free to Under $100/Month Platforms for SMBs


Scott Brinker asks, “where is all this spend going?” Gartner responded:

• Labor — 35%• Marketing technology — 33%• External marketing services (e.g.,

advertising, paid search, consulting) — 32%

So by Brinker’s calculations based on Gartner data, Marketing departments are spending 33% of their budgets on martech and 32% of advertising.

Martech has been eating the CIO’s budget, now it’s eating the advertising budget.

But It Gets More Interesting Than That“Whoa: marketing technology budgets are now surpassing advertising”


http://www.fiercecmo.com/special-reports/gartners-laura-mclellan-digital-marketing-budgets-climb-sales-budgets-are-c

Traditional marketing is about the “4 Ps” – Price, Product, Promotion, Place.

McLellan notes that for Gartner’s last eight surveys they’ve asked CMOs about the 4 Ps and she concludes, “the results are astonishing.”

The ranking of “Customer Experience” declined in importance in Gartner’s surveys from 1st to 5th. What does this mean?

Customer Experience is no longer something singularly abstract, it’s being subsumed into specific marketing strategies and implementations.

Martech as strategy has the goal of helping companies reengineer the customer experience.

What is Martech Trying to Accomplish?Martech’s Job is to Reengineer the Customer Experience

Laura McLellanVP of Marketing Strategies

Gartner


So, Where Are We Headed in All This? Beyond Advertising.


Martech is Leveling the Playing Field, Not Just for Big CompaniesMartech Solutions Are Now “SMB- Sized” The strategic role of marketing is to create bonds between the brand and the customer. Technology platforms, data science and mediated customer touchpoints are core to the

marketing function Martech increasingly bonds strategy to execution. Martech solutions now available to not just to big companies, but affordable to SMBs.


Source: BIA/Kelsey Local Commerce Monitor™ (LCM) Wave 19, Q3/2015 (and prior waves, if relevant). Methodology: Online panels.

Less than One in Four SMBs Using a CRM System

More than 2 Years

1-2 Years

Less than a Year

No, considering within the next 12

months

No

0% 10% 20% 30% 40% 50% 60%

10.4%

9.0%

3.9%

20.7%

55.9%

Q510A Does your business use a CRM system?Sample Size = 1010

CRM systems are the “gateway drug”



Maintenance of Customer Lists

14.5%

78.6%

6.9%

NoYes A Year or MoreYes Less than a Year

Q112 Do you keep a list of customers?Sample Size = 1010



Offers A Customer Loyalty Program

Currently have

Don't have, but likely to get

Don't have, and not likely to get

Not sure

0% 10% 20% 30% 40% 50% 60%

23.3%

21.6%

53.0%

2.0%

Q114 Do you offer a customer loyalty program?Sample Size = 1010



Customer Loyalty Program Management

Operate Ourselves Paper Tracking

Operate Ourselves Digital Tracking

Credit Card Company linked to Customers Credit Card

3rd Party other than Credit Card Company

0% 10% 20% 30% 40% 50% 60% 70%

59.8%

32.0%

9.6%

3.1%

Q114B Who manages your loyalty programs?Sample Size = 236



Method of Tracking Lead Sources

Other Tracking

Call Tracking

Promotions or Direct Mail

Clicks or Email

Ask Customers

0% 10% 20% 30% 40% 50% 60% 70% 80%

3.8%

9.9%

20.6%

36.3%

75.5%

Q204 How do you track leads?Sample Size = 791



Importance of Websites with Customer Opinions

Facebook Google LinkedIn Blog Yelp Twitter Yahoo Other Sites

Angie's List

Other Social

Citysearch FourSquare

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

19.5%28.7% 29.5% 31.8%

39.4% 33.8% 36.4% 36.0%44.7%

38.6%46.5% 48.8%10.0%

13.5% 15.0% 13.3%

15.5%15.4% 15.1% 13.6%

13.9%16.7%

16.6%18.2%

20.7%

22.7%24.1% 25.4%

17.5% 23.2% 21.0% 24.2%17.6% 21.9%

17.2%17.1%

26.6%

21.1% 18.1% 17.6% 15.4% 15.7% 17.6% 14.9% 12.9% 12.6% 12.1% 10.1%23.3%14.0% 13.3% 11.8% 12.2% 11.9% 10.0% 11.3% 11.0% 10.2% 7.7% 5.8%

Not at all important Not too important Somewhat importantVery important Extremely important

Q312 How important are reviews/comments on each of these sites to your business?Sample Size = 1010



Monitor Customer Comments About Business

58.7%16.1%

23.3%

1.9%

YesNo, likely next 12 monthsNo, and not likely to do in next 12 monthsNot sure

Q324 Do you monitor customer comments about your business?Sample Size = 1010



Methods Used to Monitor Customer Comments8.8%

11.1%

12.5%

67.6%

Paid Standalone ServiceNot sureBundled ServiceFree service/DIY

Q324AA How do you monitor customer comments?Sample Size = 756



Other Martech/Advertising Services Considered

Analytics, Performance TestLead Scoring

Online SchedulingPassword Management Program

Reputation MonitoringSocial Media Monitoring

Listings ManagementService that Keeps Customer Records

Analytics, Customer or Market SegmentAnalytics

Online Leads Mgt.Online Satisfaction Survey

Email Marketing

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%13.8%

13.7%

11.3%

12.2%

11.3%

11.5%

11.3%

9.7%

11.7%

10.8%

11.0%

11.5%

9.9%

59.2%

58.6%

60.0%

57.3%

57.3%

55.4%

55.0%

55.1%

52.2%

53.0%

51.8%

50.0%

44.5%

17.0%

19.3%

14.1%

13.6%

21.7%

20.4%

23.3%

17.7%

19.0%

20.1%

21.2%

23.1%

25.1%

10.0%

8.4%

14.5%

17.0%

9.7%

12.7%

10.3%

17.5%

17.0%

16.1%

16.0%

15.4%

20.5%

Not sure Don't use, not likely to in next 12 monthsDon't use, likely to in next 12 months Use

Q510 What ad related services do you use or are considering?Sample Size = 1010

Most SMBs Not Using or Considering Martech Services at the Moment



Use of Cloud Based Services

HR Service

Payroll Service

Ecommerce Services

Telecom Services

Business Software

Online/Cloud Storage

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

6.9%

6.4%

5.7%

6.6%

6.4%

6.4%

72.6%

62.2%

59.3%

53.6%

50.6%

46.3%

9.3%

10.4%

12.7%

12.4%

13.7%

14.0%

11.2%

21.0%

22.3%

27.5%

29.3%

33.2%

Not Sure No, not likely to add next 12 monthsNo, likely to add next 12 months Yes

Q512 Does your business use any of these cloud based services?Sample Size = 1010



Create Customer Specific Marketing

Customer Loyalty Program

Other

Inventory or Ordering System

Plan Operations or Marketing

Effectiveness of Advertising or Marketing

Not sure

0% 5% 10% 15% 20% 25% 30%

13.1%

13.8%

18.6%

21.1%

21.8%

23.4%

25.7%

Q605A Use of customer data from POS systemSample Size = 1010

SMB Use Of Customer Data from Point of SaleWe do see some effective use of customer data by a minority of SMBs



Reliable Easy To Use Most Cost Effec-tive

Integrates Easily With Other Tech

Powerful Comparable To What Competi-

tors Use

Newest 0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1.6% 1.5% 1.7% 1.6% 5.1% 5.4% 9.4%6.2% 6.4% 8.4% 11.0%

21.4%26.8%

32.2%24.6% 26.9%

28.7% 29.1%

33.5% 25.6%

28.6%59.3% 57.2% 52.9% 48.1%

29.2%27.1%

19.5%

Strongly/Somewhat Disagree Neither agree nor disagreeSomewhat agree Strongly agree

Q615 With new advertising and marketing technology what is the most important to you?Sample Size = 1010

Top Opinions for New Technology For Advertising & PromotionWhat it’ll take to disrupt the SMB space with martech – reliable, easy, cheap


Take- AwaysSMBs – a sector of the economy ready for disruption1. Martech Landscape – complicated but moving towards affordable and interoperable

platform stack solutions2. SMBs Are Big Part of Ad Economy – Whatever happens in the long-tail SMB space

will have an outsize. They may be small businesses, but there are a LOT of them.3. Beyond Advertising – SMBs will have more data, analytics, insights and platforms to

create touchpoints to better understand and enhance the customer experience.4. SMBs Disrupted and Disrupting - as SMBs adopt more martech, this will drive the

needle in the shift toward data-driven marketing, this will impact roles of advertising and marketing in the customer journey.