Why marketers are replacing foundational martech

“Enterprises have been in kind of a replacement mood,” said Tony Byrne, founder of Real Story Group,  at The MarTech Conference.

The changes in customer behavior during the pandemic forced organizations to improve and update their engagement technology. That’s what our latest MarTech Replacement Survey showed.

Now, marketers are looking below the engagement layer in their stack, evaluating and replacing the foundational technology that powers the other layers.

The foundational layer

“More and more enterprises are investing in what we call ‘enterprise foundation’ services,” said Byrne. “These are systems that are not channel-specific. They live below your engagement platforms, and they help deliver a more omnichannel experience.”

Just above that, in the engagement layer, companies place all the tools that help them engage customers on specific channels, such as social media, email and customer service.

Customers changed their behavior during the pandemic, using more digital channels and adopting new journeys. For instance, a customer might have switched to ordering household items they used to buy at a supermarket. Or they began to do more online research across a number of sources to inform purchase decisions.

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To keep these customers engaged, amid all these unanticipated changes, marketers had to make some more fundamental changes in their stacks.

CDP replacements

The foundational layer includes data, decisioning and content functions that power all of your marketing.

The MarTech Replacement Survey showed that customer data platforms (CDPs) weren’t as frequently replaced as some other technologies, like CRMs, but that’s because CDPs are a newer technology. CDPs sit in the foundational layer, so organizations are taking aggressive measures when replacing the new technology.

“I think that companies in general are more apt to pull the trigger when they sense something is wrong,” said Byrne. 

CDPs are where data is kept in unified profiles for each customer. That data can then be used to power engagement through specific channels, managed by the technology up higher in the stack. This is what makes CDPs foundational, and what makes replacing them a heavy lift.

Avoid managing data in the wrong place

One of the reasons why foundational technology like CDPs and other data management tools aren’t being replaced more is because data in these organizations is being managed by tools higher up the stack.

“Email platforms and marketing automation are all purported to manage your marketing data, but they’re the wrong place to manage your marketing data,” Byrne explained. “We could say the same thing about personalization and other services. So, I think, in particular, the B2B marketing automation platforms that really fashion themselves as kind of a ‘martech stack in a box’ — that works for small and midsize businesses. It’s not working for the enterprise that has a more disaggregated, layered stack.”

As the first graphic above shows, data and decisioning technology should be prioritized, as organizations replace and strengthen the foundational layer. Then, those data and analytics capabilities can help drive effective engagement with the tools included in the middle and upper stack.