Martech is NOT Being Optimized: CMO Survey Key Findings and 5 Tips for Improvement

The biannual (twice per year) CMO Survey has just been released, and it offers some eye-opening revelations about the state of marketing operations. Almost 300 marketing leaders participated in the survey, and the topline findings are not good. In fact, the surveyed CMOs say that:

1. Only 56% of the martech tools they’ve purchased are being used at all,

2. Only 34% of martech tools are meeting expectations in terms of delivering on anticipated results, and

3. The biggest challenge cited by the CMOs, related to the two data points above, is "integrating marketing technologies across other data systems in the organization." 

That last problem around integration, as every MOPs professional knows, is a foundational one. Most marketing orgs are currently exploring how to leverage artificial intelligence in order to drive marketing ROI. But a lack of martech and data integration has a huge negative impact on any marketing organization’s ability to access the benefits of AI, now and/or in the future (more on this key challenge below).

After we’ve fully explained the key findings of the CMO Survey, we’ll offer a few recommendations for how you can drive improvement in how you optimize your martech stack.

CMO Survey: 6 Key Findings

1. Martech investments continue to increase

Most companies plan to increase their martech budget annually, from the current 19% of the marketing budget to 23.5% next year. Martech investments are expected to be 31% of total marketing budgets in 5 years, so the “spend trend” is clearly upward. 

But as martech budgets continue to increase, there’s growing pressure on CMOs to deliver a seamless integration of newly-purchased martech tools in order to drive a sufficient return on their martech investments.

2. AI is making an impact

The marketing leaders surveyed say that AI is beginning to drive significant impacts. In fact, they say AI has: 

• Improved sales productivity by an average of 5.1%,
• Enhanced customer satisfaction by an average of 6.1%, and
• Decreased marketing overhead costs by an average of 7.0%.

Impressive results, yes, but we’ve only just begun to integrate AI into marketing workflows. AI must be built on top of a firm foundation of (1) integrated martech tools and (2) martech tools that share data with each other and across the entire organization. 

3. A disconnect between martech purchases and organizational goals

Martech purchases have little or no value unless they’re supported by strategic goals and connected to specific use cases (such as enhancement of customer experience). When purchases are not clearly aligned with business goals and specific use cases, organizations are tossing their money out the window. 

The CMO Survey shows that one of the root causes of martech underutilization is a lack of connection to any strategic focus on specific use cases. “Buying stuff” doesn’t necessarily drive ROI.

4. Martech tools are going woefully underutilized

CMOs may be purchasing more martech, but a failure to maximize their value is the rule, not the exception. About two-thirds (66%) of purchased martech tools are not delivering on expectations.

When CMOs were asked “how well is your company performing on each of the following marketing technology activities?,” on a scale from 1 (poorly) to 7 (very well), CMOs responded as follows:

• “Designing the broad architecture of our marketing technology systems” rated 4.4. So CMOs seem to be just bolting on parts to a machine that’s disjointed and increasingly difficult to manage.
• “Generating ROI from marketing technologies” and “Developing capabilities for using marketing technologies” both rated 4.5. So CMOs understand that they’re not maximizing martech value, not enabling their people to use it, and not driving sufficient ROI.
• “Integrating marketing technologies into our customer funnel,” “Leveraging data for tactical decision making” and “Leveraging data for strategic decision making” all rated 4.6. Again, failures around integration lead to a fragmented funnel and an inability to implement AI.

5. More focus placed on top of the funnel, and not enough on full funnel

The CMO survey clearly shows that the main focus of martech tools and investments are on lead generation (top-of-funnel) activities, while bottom-of-funnel (e.g., customer acquisition and nurturing) and driving long-term customer value are viewed as secondary concerns. 

Meanwhile, marketing leaders and marketers know – at least in theory – that all steps in the buying journey matter to customers, not just the moment of closing. Therefore, connecting your current tech stack to all the stages of the customer journey is foundational. 

Focusing on lead gen and neglecting the rest of the funnel journey is like having an incomplete map to where you’re headed – it’s a great way to get lost as you seek to optimize your martech stack.

6. Martech effectiveness metrics misaligned with full funnel focus

Related to the point above, marketing organizations are also using internal metrics that are skewed towards the top-of-the-funnel and fail to map the entire buying journey.

The most common metrics cited by CMOs to measure martech effectiveness are lead generation, sales, and lead conversion, which are all (of course) relevant indicators. But the three least common metrics cited by the CMOs are also important ones: lifetime customer value, customer loyalty, and pipeline acceleration.

5 Recommendation for Optimizing Martech

Every MOPS and marketing organization is different, and confronts a different set of problems. With that said, we suspect that every organization struggles to optimize its martech. As such, and based on the challenges described above, we’d like to offer you a few recommendations for improvement:

1. Audit your martech stack regularly. You can’t improve what you don’t monitor and measure. We at Sojourn Solutions know from long experience that some marketing organizations don’t even know what martech tools they’ve purchased, let alone understand: (1) the strategic focus of each purchase and (2) the specific use cases the purchases were/are intended to support. Start by auditing what you have, and then map each listed martech tool to a strategic focus and its specific use cases.

2. Dump whatever isn’t aligned to a marketing strategy or use case. Once you’ve mapped each tool to a strategic focus and/or specific use case, you can begin evaluating what tools are actually delivering business value and which ones are just taking up space and wasting budget. If a martech tool isn’t earning its keep, move on from it as soon as you can.

3. Evaluate the level of integration within your martech stack and across all your systems. This is a big one, because tools that aren’t connected and sharing data with each other make your stack impossible to optimize. That’s especially true when it comes to a present and future featuring AI. Map your existing integrations and identify areas where you need to integrate.

4. Evaluate your marketing metrics, especially those around martech efficiency. The CMO Survey showed an overemphasis on top-of-the-funnel metrics like lead generation and a relative neglect of metrics related to the full customer life cycle.  Customers expect you to add value at every step of the customer journey. The marketers who focus on the entire funnel are the ones who succeed in good times and tough times.

5. Get outside help, if and when needed. If you don’t have the internal resources to implement the first four recommendations above, consider bringing in outside expertise to help.

You can read the full CMO Survey for Spring 2024 (free). If you’d like to improve your marketing operations and maximize the ROI of your martech investments, Sojourn Solutions can help. Reach out to us today!