Two decades ago, a spunky little start-up called Netflix indirectly gave a big boost to marketing technology.
"This tiny company was spending more than half of its engineering dollars building its own tools in-house for marketing automation," recalled Ashu Garg, general partner at San Francisco, Calif.-based Foundation Capital, an early Netflix investor. "We thought that made no sense. Since most companies can't afford to spend that much money on engineering tools, we thought 'why don't we invest on companies that do this?'"
About a dozen marketing technology investments later, Foundation Capital is very much invested in the MarTech space.
And it's a space the VC firm predicts will undergoing "radical transformation." In 10 years, in fact, it predicts it will be worth $120 billion yearly.
"It is a shift to an all-digital world," Garg told CMSWire. "All advertising will be digital by the end of this decade. The role technology plays in marketing is changing dramatically because of the opportunities."
MarTech's Next 10 Years
Foundation Capital produced what it calls "five keys to unlocking the decade for the CMO" in a recently released whitepaper. The CMO, Garg said, is becoming the new CEO — "Chief Experience Officer" — and ultimately more of a revenue driver.
This will be the decade of the CMO, a shift from the CIO in the past decade, he said. Here are five trends Garg thinks CMOs should know about marketing technology.
1. All ROI is King
Marketing analytics software will help marketers quantify the impact of their spend and move from being cost centers to revenue centers.
"That's the fundamental shift for CMOs: Going from an expense to a business driver. In our minds, that is the anchor of this technology spend. CMOs will dramatically invest in software that enables them to measure, quantify and then reliably show the business impact of their marketing spend."
2. Hire Math Men, Not Ad Men
The three-martini lunches are over. To survive today in marketing, CMOs will need to be math men and not ad men. "We believe the data nerd of today is the CMO of tomorrow. Folks with quantitative skills will rule. All media bought will be programmatic by the end of the decade, and we look at that as a takeover, not a fad or trend."
3. Publish or Perish
Where marketers have been historically advertisers, they need to -- and will -- become publishers.
"Content is the new ad. The best ads are great content. Content is not a new idea, but what is a new idea is that you not only have to produce hundreds if not thousands pieces of content but you also have to target it, analyze it and measure it. You have to produce authentic content at scale, which requires marketers to become publishers. And that will require technology."
4. Embrace Mass Personalization
The belief that all consumers will have truly unique experiences will continue to be powerful for digital marketers. "This is the future of marketing and requires a completely different software stack."
5. Learn to Close Deals
Marketers are no longer handing off deals to sales and support. They are becoming the closers. Who's going to close the deal on premium software? "I would argue that it's marketing," Garg said.
The data Foundation Capital shared with us falls in line with a recent conversation we had with Marketo. The San Mateo, Calif.-based marketing technology provider also thinks that the roles of CMOs and marketing departments are shifting from cost centers to revenue drivers.