Study: Desire to Excel in CX Is Driving In-House MarTech Growth

According to’s MarTech Landscape infographic, there are almost 7,000 companies providing marketing technology in the market. This is a huge jump from the 150 listed companies in the 2011 version of the graphic. Globally, the MarTech industry is estimated to be a $100 billion market, with half of that concentrated in North America and the UK.

This extremely competitive market appears to only be getting more so, but not necessarily because of even more entrants. A new report from Moore Stephens and WARC which surveyed “more than 800 brands and agencies based in the Americas, Europe and APAC,” found that many are shifting MarTech budgets in-house.

The study discovered that 63% of overall tech budgets in North America are being spent in-house in 2018. On the marketing side, 15% of budgets are being spent on in-house MarTech, and just 9% is being spent on outsourced MarTech in North America. Compared to 2017, in-house MarTech spending was up 200% while outsourced spending growth remained flat.

For clarification, the report defined MarTech as “a tool that you use to assist with marketing workflows; customer acquisition and retention; brand and communications; content and social; or data analytics.”

This is a very interesting shift. While many MarTech providers have built sophisticated and comprehensive technologies that often address specific marketing challenges, brands are seeking more ownership of the technology. The report attributes this to two things: a desire to excel in the customer experience and mistrust in agencies.

MarTech tools are also making their way into the small business (SMB) arena. However, the SMB market is different than the enterprise space. Most SMBs don’t have the budgets or sophistication to build in-house MarTech solutions. This suggests that the shift to in-house MarTech will impact enterprise providers, not direct-to-SMB tech companies.

There’s also plenty of headroom when it comes to SMB technology adoption, with only a minority to date saying they have adopted cloud-based solutions. However, it is gaining steam, according to the Tech Adoption Index, with the number of local businesses using cloud-based software increasing across all functional areas surveyed.

There is also a growing recognition among SMBs that if they fail to adopt new technology they will fall behind. The challenge they face is finding trusted providers and seeing value.

The desire to better optimize the customer experience appears to be behind the willingness for brands, in some cases, to reinvent the wheel. Each brand seeks to offer a unique customer experience, and to do so, MarTech dollars are shifting in-house. SMBs will need to do something similar on a smaller scale but they’ll need support from third party providers to get there.

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