3,500 MarTech Companies and Counting…

At Industry Index we’re obsessed with organizing, categorizing, and segmenting the Industry. We’re tracking 5,000+ tech companies across MarTech/Adtech, as we like to call it — MadTech. Our tracking is expansive — e-commerce related companies, social media, chatbots, augmented reality, salestech, marketing automation… the list goes on.    

Meanwhile, there is a lot of great research occurring all around us. One data point that caught our eye was published on Chiefmartec. They recently announced that they now track over 3,500 MarTech companies, up from 2,000 in 2015 and 1,000 in 2014.  

Sure, you can quibble with the exact number, but the pace of growth is undeniably astounding: It doubled from 2014 to 2015, and then grew 87% again between 2015 and 2016. Simultaneously, tremendous consolidation continues. It seems like every week there’s another deal.

Why the tidal wave of growth?

1)It’s the money.
All signs point to the explosion of investment capital, sheer number of startups, and expansion of the MarTech ecosystem. Pick your favorite statistic:

  • MarTech spending is expected to reach 10% of overall budgets for Fortune 500 companies by 2024 (up from 1% in 2014)
  • MarTech spending reached $12B in 2014
  • MarTech spending will reach $120B by 2024

2)There are additional compelling reasons for the proliferation:   

  • It is easier than ever for brands to try and test tech.  
  • Most new tech have APIs that allow faster deployment and integration
  • The SaaS model reduces tech acquisition costs – lower risk to try
  • The proliferation of tech drives more targeted “point” solutions; tech deployments can be for single campaigns or trials
  • Previously siloed data and systems can now be integrated and leveraged with relative ease
  • Most importantly, customers are expecting more and better engagements with companies – Personalized, fast, authentic… IMMEDIATE!

Marketers ultimately need to remember the real reason they’re investing in MarTech: To better understand current and potential customers with the purpose of driving sales. Companies need to make sure that their marketing stack—regardless of the vendors that they work with—provides deep customer intelligence and paints a holistic picture of the customer.


What does this mean for MarTech buyers?

  • First and foremost, the phone will keep ringing, emails will be chirping, LinkedIn messages will fill your inbox.  
  • The market is difficult to understand and sort out. Understanding the differentiation of companies within a category can be agonizing. You need to start with a different perspective:
    • It is incumbent on buyers to start by developing a general understanding of the type(s) of tech that are interesting.
    • You need to focus more attention on developing your own requirements.
    • Finally, consult the data. More and more companies are utilizing research to produce content, and much of this research is extremely useful.  However, you need to be a smart consumer of data/content. There is a BIG difference between research studies, true thought leadership, and long, glorified sales pitches.

What does this mean for MarTech vendors?  

For starters, doesn’t it feel like there is more competition? That’s because THERE IS MORE COMPETITION.

As Industry Index began planning for its website relaunch for this summer, we began with a basic question:  Where are the boundaries of MadTech and how do we organize our data?  

This lead us to explore vast numbers of companies, and where they sit in the ecosystem.  It was immediately apparent that not only were there many more companies, but the boundaries had expanded. And, while many of the new entrants are narrowly targeting a single problem, most companies are now, unlike five years ago, selling solutions that inherently include data, products, and integrations with other technology types as basic table stakes.  

So what does it all mean…

  1. Despite all the M&A activity, the marketplace is growing more crowded.
  2. The lines between tech categories are getting very murky.
  3. More MadTech products are being sold directly to brands – sometimes because the agencies are reluctant to test, but more often because data integration requires direct relationships with brands.
  4. Marketers are increasingly trying/buying tech, but companies’ product lifecycles are shortening.
  5. Most MadTech vendors continue to dance in the dark, not knowing the basics: the whos, whats, and whys of their prospect lists. Vendors are too willing to attempt to stretch their product capabilities in exchange for a few more dollars of revenue.

660 Minutes


We recently published a study, Research + Content = MadTech Sales. The takeaway:  “Research based content trumps all other forms of marketing.”

We’re not saying the industry isn’t already generating thought provoking, innovative, fresh and informative research. But competition amongst industry experts in the attention economy is growing fierce. Every marketer of MadTech has to… well, bring their A-game. So what does an A-game look like?  

First, audience: Marketers have to strategize and focus on who the research needs to reach and impress. According to new research from Gartner, “Marketing tech budgets are on track to exceed the amount of money CIOs spend on technology in the coming year.” So, let’s connect the dots… the most sought after potential customer for MadTech vendors is the CMO — one of the hardest people to connect with, and even harder to keep their interest.

Second, budget: MadTech vendors have to cease misallocating budgets by accurately accounting for how much money marketing companies are generating towards technology. From the research Gartner depicted, Forbes broke down the numbers: “The average marketing expense budget is now equivalent to 12% of company revenue, and 27% of that is allocated to marketing tech… This 27% is 5 percentage points higher than what CMOs allocate to paid media… Further this 27% means that 3.2% of a company’s revenue is now set aside for marketing technology.” These numbers shine a true light on the importance of tech and who is going to control the budget in coming years.

We hear you saying, “Challenge accepted.” But before you go charging into the CMOs office…

According to Digiday, “the average person spends more than 11 hours each week reading emails, and competition is fierce for every one of those 660 minutes.” This. Is. Just. The. Average. Person. An OMD executive was painfully honest with us, stating, “I actually don’t answer my phone.” Gulp.

What does a vendor have to do in order to stand out and hold a CMOs attention?

With a strategic email marketing plan, research-driven content and the realization of where efforts have to be focused in the coming year — MadTech vendors will be able to offer something more to CMOs. Recalling again our recently published study, “Research-based content trumps all other forms of marketing and can make other communication initiatives more effective.” In order for this research to be effective, it needs to be contextually relevant. According to our Index Insights, 93% of surveyed panelists say that relevant research will positively impact a company as a potential partner. But then only 14% said they’ve received thought-leadership content that was relevant.

Marketers of MadTech, you have your work cut out for you. But if you have information the CMO needs, she might have something you want: Her attention.

Media We Like: “MarTech + AdTech = Success”

I.I. team members share our faves with each other. Now, we’re sharing with you. We’ll keep doing it, too. 

A World Without Work (The Atlantic) – July/August 2015
(From Chris) For centuries, experts have predicted that machines would make workers obsolete. That moment may finally be arriving.

The Platform Of The Future Will Own The Intersection Of Advertising And Marketing (AdExchanger) – Nov. 7
(From Jonathon) Whoever masters and melds marketing and advertising will dominate an industry now ruled by Facebook and Google. Salesforce, Oracle, Adobe and the holding companies are contenders.

The Secret Formula For The Perfect Viral Share (SocialTimes) – Jun. 4, 2014
(From Dorian) In depth, long form (meaning research-driven) content performs best.

Breitbart Urges Boycott of Kellogg After Brand Abandons Site (Bloomberg) – Dec. 1
(From Mark) Discusses AppNexus’ barring of Breitbart for hate speech.

15 SEO Best Practices for Structuring URLs (The Moz) – Feb. 24, 2015
(From Chris) Write for humans. Try to avoid hashes. And other tips. See the comments, too.

Programmatic Display Ad Prices to Surge 20% by 2018 (The Drum) – Nov. 22
(From Jonathon) … due to publishers using yield optimization technologies, says a study.
And, programmatic will grow faster than other channels. (MediaPost)

(Join in! Tweet us or tell us via LinkedIn some media of interest that you think is worth sharing.)