Chief marketing officers remain hopeful that their budgets will increase in 2020, but numbers don’t lie. According to the Gartner CMO Spend Survey 2019-2020 (registration required) released earlier this month, marketing budgets have dropped below 11% for the first time since 2014. The survey of more than 340 marketing executives in the US and UK found marketing budgets dropped from 11.2% of overall company revenue in 2018 to 10.5% this year.

About 61% remain hopeful budgets will increase next year, but they were also hopeful last year. This indicates “their optimism is misplaced,” Ewan McIntyre, vice president analyst in Gartner’s Marketing practice, said in a press release. “Unfortunately, very few of us are in a position where we are told to spend whatever we want on technology and programs,” said Anita Brearton, founder and CEO of CabinetM, which offers marketing technology stack management services. “Most of us in marketing are under constant pressure to reduce or optimize spend in order to improve the cost of customer acquisition and customer lifetime value.”

Martech Investments Have Dropped

Spending decreases have hit marketing teams in many areas, including marketing technology (martech). Martech investments dropped three percentage points year over year in the Gartner survey, falling to 26% of marketing budgets in 2019. Gartner officials called it a “more volatile investment area.” Volatile, perhaps, but certainly no shortage of tools: there’s at least 7,040 martech solutions out there.

A big problem? Many organizations do not have centralized oversight of their technology nor any sense of their own internal technology proficiency, according to Brearton. “It’s almost impossible to meet marketing objectives with no knowledge of the tools being used in pursuit of those objectives,” she told CMSWire. “I’m also surprised by the lack of process around purchasing technology; swiping credit cards is still a common approach for acquiring new tools. In today’s environment where data compliance is increasingly important and security risk is top of mind, this is a bad strategy.” 

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Is Homegrown Martech the Solution?

Considering the homegrown martech route? Sure, some organizations have had success but that strategy comes with its own caveats. About 77% of decision-making marketers in the UK, and 75% in the US, have developed or are currently developing homemade technology in their current role, according to a Mailjet study released in September. But they also reported concerns with the cost, time spent and expertise required to build and maintain these tools: More than half of the respondents using a home built solution reported that they found it to be more time consuming than using third-party technology, according to the Mailjet research.

Begin With Data Foundation, Strategy

So now the question remains: How can marketing leaders make the most of their shrinking budgets and save money when it comes to martech? Start with data, according to Jakki Geiger, CMO of Reltio. When evaluating the many marketing technologies out there, think about the customer data layer beyond the marketing function. “Many CMOs who are responsible for driving connected, consistent and hyper-personalized customer experiences across all touchpoints throughout the customer journey are taking an enterprise-wide approach to customer data,” she said. “And, as CMOs embrace the use of advanced analytics, artificial intelligence and machine learning to improve customer experience, they need to be fueled by connected customer data designed for the experience economy. Otherwise those investments fall short of the business value they are expecting.” 

Set a customer data strategy and data foundation that’s designed for the experience economy, she added. This will provide business agility and enterprise scale and supports the creation of big ideas through advanced analytics, machine learning and AI. “It should,” Geiger said, “deliver insights at every customer touchpoint and to the teams who interact with customers. It should also simplify compliance with regulations like GDPR, CCPA and any emerging customer privacy laws.”

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Foundational Martech Pieces Must Integrate and Work Well

In terms of saving money and getting the most out of your martech stack, the foundational pieces (marketing automation, CRM and analytics) need to be functional, logical and able to interact with each other correctly, according to Joyce Solano, CMO at Ironclad. “If the technology and the governance around those technologies are not in place then all the other tools will basically be useless,” she said.

Audit Your Martech Stack Regularly

Solano suggests a martech audit to see if you’re actually using all the systems for which you are paying. If you are, decide whether it is more than you need. For example, in Marketo, you might be able to reduce your database ceiling to a lower-cost tier or, in Salesforce, reduce the number of licenses needed for your employee base. 

Learning Opportunities

Run the numbers, Solano said. “Do you really need that fancy — and costly — employee signature solution or social sharing gamification tool vs. an in-house DIY cut-and-paste hack?” she asked. “Is it providing a measurable benefit? If not, scrap it.” 

Check for capability overlap. Do you have multiple platforms each providing marketing landing pages capabilities or blogging? “I’ve seen platforms like Marketo, WordPress and Splash installed side-by-side at organizations, all of which offer landing pages for events or other activities,” Solano said. “Find out if there’s a real cost-benefit for doubling or tripling up and reduce redundancies.”

Related Article: Are Your Organization's Martech Investments Working?

Dig Into Value, Performance of Martech

Shad Foos, chief marketing officer of Service Management Group (SMG), said his teams have conversations about the value and performance of new martech — vs. expectations and vs. current software — to ensure it is adding real value. "This keeps us from having to fully analyze all the software at one time during our budgeting cycle," he said.

They take an annual look at how the industry is investing in marketing as a percent of revenue. It then looks at demand generation best practices for martech spend as a percent of marketing investment. “For our category, we use 6% to 8% as a good guide for marketing as a percent of revenue, and 10% to 20% for martech as a percent of marketing investment. We overlay this market data with our annual marketing priorities.”

In 2019 his marketing teams have been focused on which tactics are generating pipeline and revenue. It added marketing attribution software to build look-alike buyer journeys. “We’re also making sure we’re starting conversations with buyers earlier in their discovery process,” Foos said. “So we added de-anonymization software to our website.” 

Don’t Be Afraid to Rip and Replace

Foos said his marketing teams are not afraid to rip and replace current solutions with something that offers expanded capabilities vs. bolting a new solution to an existing solution that’s no longer performing. “We try to avoid customizations and workarounds for existing solutions,” he said. “It’s usually less expensive — and less work — in the long run when we can use updated martech solutions right out of the box.”  

People and Processes Matter, Too

Savings in martech, and marketing costs in general, go beyond technology, according to Brearton. Don’t forget about the people and processes, for which she offers the following tips:


  • Audit the internal technology proficiency of your team: Do you have the skills you need to fully utilize the products you’ve purchased? "I remember talking to one company who bought a very expensive product and then took a year to find someone with the skills to operate it," Brearton said.
  • Identify where training is needed: Training can positively impact the utilization of technology which in turn improves performance. Better utilization of a product or platform may help eliminate other pieces of technology.


  • Review all processes to ensure that stakeholders and responsibilities are well defined and that the processes in place make sense for the current stage of the business.
“With a little discipline and a pragmatic approach to evaluating your technology, people, and processes,” Brearton said, “you are likely to save money and improve the performance of your team.”