Coming Martech Era
The adtech era’s exponential growth will slow in the coming years. Brands will realise that they need to think beyond acquisition. Retention, sustaining relationships for a lifetime, offering rewards for transactions and upstream attention and engagement, maximising revenue and profits, driving referrals – this is what companies should be doing. This is hard work, and what the real focus for CMOs should be. But there is no Google-Facebook equivalent to do it for them. The result is a leaky bucket – as existing customers become inactive or churn (targeted by other businesses via – you guessed it – Google and Facebook), businesses get trapped into a “doom loop of spending”. More and more monies get poured into reacquisition to keep their growth going. As long as investors are not asking for profits, this works fine. At some point, the tide will turn and there will be a demand for profitable growth. It is then that CMOs will be forced to pay attention to their existing customers. That will be the start of what I call the Martech era.
The Martech era will be characterised by a focus on 4Rs: retention, rewards, reactivation, and referrals. It will need marketers to think about segmentation based on customer lifetime value. Marketers will need to combine tech, data and analytical skills to make the most of all the demographic, behavioural and transactional data that will flow into a Customer Data Platform (CDP). They will need to integrate different tech solutions together to get a unified view of the customer. What will matter is not just a one-time acquisition but the customer journey, with the right nudges at the right time to ensure timely transactions. AI will assist the marketer at every stage but the questions and creativity will need to come from the marketer. Art and science is what will make martech work like magic.
This will need a new bag of tricks for marketers. It will be much more than just saying, “Oh – that’s what our CRM department does.” The Martech era is in fact the second coming of CRM. Only this time, marketers will be armed with much more data and have a wider arsenal of tools to create myriad magical moments for their customers, rather than just one-time offers. The way marketers have prioritised and perfected ad spending for new customer retention is what they will need to do with existing customers. As of today, most CMOs have a limited focus on this because adtech sucks away 80-90% of budgets and attention of marketers. In the years to come, in a world where the profitable pool of customers for a category is finite, marketers will need to switch time and money to martech to drive customer communications, engagement and experience and ensure they grow profitable customers who stay with them forever. Martech done right will help them optimise their adtech spends, create the space for profits, and lay the foundation for winning the customer moments that will drive exponential forever profitable growth.