The first article in a short series.
I have a confession to make. I’m English. Or, in that popular but harsh formulation, “a Brit.” I’ve spent most of my adult life in New York, including my entire career in tech and marketing tech journalism. But people hear my accent and think I can tell them something about the marketing tech space in the U.K.. “No,” I’d admit. “I know Salesforce and HubSpot, for example, sell there, but more than that I cannot tell you.” That’s no longer true. Before the holidays — and partly prompted by the release of U.K. marketing landscape supergraphic (see below), I decided I needed to come up with a more thorough understanding of the similarities and differences between the two spaces.
For an overview of the main UK trends, I turned to two sources, Jordan Adams, founder and managing director of MarTech Tracker, and Jonny Rose, head of content at Idio. I also spoke to an agency which extends its digital expertise, and strategic and creative insights, across an international customer base — including the U.K. — Olson 1to1. And I asked our friends at CabinetM to list the home-grown U.K. marketing tech vendors on their radar.
Here’s what I found.
Perspectives from MarTech Tracker and Idio
Although in the business of identifying leads for technology vendors, MarTech Tracker’s process gives it extraordinary insight into marketing stack trends, in the U.K. as well as globally. Adams explains: ” I launched MarTech Tracker three years ago. We help marketing tech companies generate leads, but the way we generate those leads is we speak continually to martech buyers to find out what their pain points are, what technology they’re using, what tech they’re interested in, and how they like to learn,” whether it be white papers, webinars, or demos. The short version of what we have is a very large database of marketing tech buyers.” The job functions in the database include IT, marketing, data, and CX leaders.
Adams offered a simple example. “We would know the global make-up of somebody like HSBC, what tech they’re currently using, what challenges they face, and how they like to learn.” MarTech Tracker maintains its knowledge database by speaking to about 80,000 representatives of purchasing companies per month (using trained telemarketing resources It also uses a legal and compliant tool to scrape cookie based tech platforms and see what they’re built on).
“If you tell us what you’re interested in, we’ll connect you with the right people.” Adams monetizes the interaction by collecting on in-market leads. “Really what we do is to spend a lot of time working out what people in martech — buyers and users of martech — are thinking.”
Idio also plays in the B2B lead generation space, but doesn’t just serve marketing technology vendors. It uses content intelligence to analyse the performance and effectiveness of B2B content, gathers buyer intent data, and helps its clients deliver next-best-content across a wide range of channels. As a marketer of marketing technology, Rose follows the space with unusual passion.
Investor pressure causes churn for U.S. vendors
Adams travels to the U.S. several times each year, attending conferences and meeting clients. “The biggest difference I see between the two regions is that for U.S. companies, everything seems to be geared to winning customers. Whether it be the companies or their marketers, it’s all about ‘go and acquire customers.’ In the U.K., it’s much more around ‘keep customers; don’t let customers leave.’ Everything in the U.K., partly because of GDPR, seems geared toward data and data management technology,” with the main objective of understanding and retaining existing customers.
“If you look at the big marketing automation players coming out of the US, coming into the UK – Marketo, HubSpot, Oracle’s Eloqua – they are used in abundance.” The huge majority of companies on the U.K. landscape are not VC-backed. “They’re privately owned, they’re cash rich, and they’re having to work hard with a smaller number of customers and get it right, rather than have the luxury of let’s go and get thousands and try to sell them something off the shelf.”
Many U.S. vendors are, however, under pressure from investors: “They’re coming into the UK and trying to swallow lots of customers at once.” The result, according to Adams, is something like 30 percent churn for these U.S. entrants to the U.K. market. “People are leaving these systems as quick as they can buy them.” On the other hand, referring to the U.K. marketing technology landscape (see below), “Many of the logos that are on there are well-known, they’re profitable companies, but they’ve got very few customers. They’ve built their whole proposition around having one or two customers they’ve really, really got to know. And their products are phenomenal, because they’ve learnt on the job, managing one or two customers.”
Last summer, land of my birth just got its own Marketing Technology Landscape Supergraphic. And it’s a lot less cluttered that the United States version, the brainchild of Chief Martec himself, Scott Brinker. Brinker introduced a modest version of that compelling graphic back in 2011, showing no more than about 150 companies in the space. The 2018 version displayed almost 7,000, and is now so packed that it’s pretty much just a visual icon rather than a legible guide. Strain your eyes right here.
This is the landscape Adams refers to when he says the number of logos is small, but that many represent profitable companies with small, very loyal customer bases.
Brought to us by the UK-based MarTech Alliance, and put together by Carlos Doughty, the landscape is populated by only 417 local vendors. This may be a slight underestimate (our friends at CabinetM are able to list over 500 UK-founded marketing tech companies). But more importantly, it distorts the picture slightly by not showing — by design, of course — non-UK players who are playing in the UK space. In other words, there’s plenty of data-driven marketing afoot in the old country, driven by brands like Salesforce which have significant UK operations.
Adams went on: “A lot of the tech companies coming out of the U.S. and into the U.K. haven’t had that one to one to few learning in the early days, and they’re seeing it in their retention rates, which is why some are having such a retention problem in the UK.”
The U.K. space, Adams told me, has developed organically. “There’s less ego around raising cash, and the focus tends to be on product – not on acquisition to keep the investors happy. How that translates (for U.K. marketing tech customers) is that there’s a lot more bespoke tech, more hand-holding, a lot more hours spent trying to really understand their business. In the U.S. I’ve seen – onboard them quickly, get them into recurring revenue, and then find the next one.” It’s a sweeping statement, he admits. But he also offers a broad characterization of the U.K. mind-set: “We’ve got GDPR to think about; find the tech which allows a deep dive into customer intelligence, and don’t lose them.”
That means that most of those logos in that landscape – “wherever they happen to be pigeon-holed” – relate to data intelligence. “Understanding what you’ve got.”
Technology is important: budgets are smaller
For Rose, the implications of data and technology are global; the extent of usage determined in large part by budgets. “I think I’d want to impress on anybody looking from Stateside that – ideologically – technology and data is every bit as important to U.K. as to U.S. marketers. In truth, that’s because U.K. marketers – the Jonny Roses of this world – are serving and competing for pretty much the same profile of customers as our US corollaries. If you’re in the B2B world, really you have a global purview. It doesn’t matter if you’re launching your sales message from San Francisco or Holborn. The world has got smaller.”
The shock troops of marketing tech, said Rose – the analysts like SiriusDecisions, for example – once upon a time might have had a very U.S.-focused point of view. “You used to have to go to Arizona or Dreamforce to hear that type of thing.” (Note: Arizona is a state, Dreamforce more a state of mind). But as Rose points out, events like SiriusDecisions summits can now be found in the U.K. and Europe. “They’re delivering the same thought leadership, perhaps without the pizzazz or pyrotechnics, right here in London. That means there’s no longer quite that disjunct where you had to cart yourself to America just to see it.”
There’s no longer a ringfence around the trade press either, he said: The availability of learning and best practices “is very much democratized across all the B2B media tech propositions. Glenda in Bradford and Adrian at the cutting edge in Silicon Valley, are still receiving the same messaging from the vendors.”
So is there a difference between the U.S. and U.K. marketing tech markets? The U.S. market, Rose told me, is much more mature for two important reasons. First: “In the U.K. you have reduced budget, even for enterprise and mid-cap companies.” Idio, he noted, is very much trying to sell to such companies. “You simply do not command the same budget as a U.S..” Whereas in the U.S. medium to large companies are perhaps buying the entire marketing cloud, end-to-end, in the UK they are likely just investing in some point solutions. Second, personnel. “There are fewer B2B marketers in the U.K. who are trained to sit behind a Pardot or a Marketo. Just those two points. We’re receiving the same messages, same theories; we know who the vendors are, but there’s a lack of talent to manage stacks, and a lack of budget.”
My observation is that those two factors are likely reciprocal. Why invest in recruiting and training staff to manage solutions you can’t afford?
Still to come: What’s keeping UK marketing tech buyers awake at night? Who are the big home-grown vendors? Plus, the agency view, from Olson 1to1. Check back tomorrow.