Martech 2.0 and Web3: Solving Advertising’s 50% Problem (Part 4)

Past Writings – 1

I have been writing about the changes in adtech (which will create the opportunities for martech) over the past several months. Here are some excerpts:

Marketing: Disrupted and Simplified: “Seduced by the ease of spending on Google and Facebook, and the excitement of continuously acquiring new customers, they missed deepening relationships with existing customers. It is not just marketers but even CEOs who are at fault. The question that gets asked is: how many new customers did we acquire? There is little discussion about retention and revenue expansion from existing customers. (This is true for B2C and B2B brands.) In a competitive market, the focus shifts to landgrab and leads to an arms race of spending investor money or retained profits to show perpetual growth of website traffic or app installs. The rise of ad revenues of Google and Facebook testify to the marketers’ folly.”

Attention Messaging: Bridging Adtech, CPaaS and Martech: “Digital marketers find themselves trapped between new customer acquisition and re-acquisition of those whom they lose. The supply of new customers is not infinite – after a time, there are diminishing returns in acquiring new customers whose spending potential is low. And yet, for the business to show growth, they need to keep new customers coming in. Where do they find such customers? From their own pool of lost or dormant customers! This leads to what I call the “doom loop” of spending: customers get acquired, some of them become inactive, they are then re-acquired, some among them become inactive again, and they are re-re-acquired.”

Stop Loss: The Power of Attention Messaging: “Digital customers mean digital marketing. And digital marketing has been reduced to handing over money to Google and Facebook for acquiring new customers. And then re-acquiring them when they are lost. This creates a doom loop of spending which has meant that 90% of digital marketing budgets (which can be half of funds raised by startups and growing companies) is channelised to the tech giants. Marketers are getting locked into an arms race of spending for acquiring less valuable new customers and a growing pool of inactive customers, even as revenues and profits for the tech duopoly reach record highs. Even D2C marketers face a challenge – marketplaces like Amazon vacuum away budgets in hypercompetitive search placements.”

The Coming Martech Era: Driving Exponential Forever Profitable Growth: “The past two decades have been the golden period of the Adtech Era. The platforms, Google and Facebook, have seen their market cap grow immensely on the back of creating an easy point-and-click approach to targeting ads and acquiring new customers. Every business wants a continuing pipeline for conversion, and the tech platforms have done this amazingly well. Aided by the big ad agencies, the duo sucks away an increasing percentage of revenues from companies hungry for growth. New customer acquisition has never been easier, thanks to Google and Facebook. As VCs, PEs and public markets have rewarded growth over profits, companies have channelled resources for new customer acquisition.”

The Coming Martech Era: Driving Exponential Forever Profitable Growth: “The big mistake brands have made is to let these two giants [Google and Facebook] get in between them and their customers. It is time to reclaim the direct relationship and exit the arms race of ever-increasing new customer acquisition costs. This is the key to simplifying marketing.”

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.