Nitro-Net.com – A Global Marketing Group Company
The decision to invest in marketing technology is affected by many factors. An important one has to do with your budget availability.
Marketing technology has become a trending topic among marketers as they try to explore the best way to improve their strategies. As the number of marketing technology solutions increases so does the confusion with which technology fits their needs.
The start of the martech buying process involves many considerations, with the budget being one of the most critical ones.
According to Ascend2’s report, 59% of marketers believe that budget availability is their biggest challenge to acquiring new marketing technology.
How do we define budget as a challenge in martech investment though?
Marketers view the budget availability as the biggest challenge before acquiring new marketing technology.
A quick interpretation of it would focus on the cost of technology. However, this attempt entails the danger of miscalculating the cost of such an investment and what it also includes. A complete budget analysis cannot overlook the budget needs of the people and the process that is involved.
Thus, a more accurate definition would include:
- ongoing cost
- additional features (beyond the initial cost)
When acquiring new technology, it’s also important to integrate it into your existing marketing stack. This may bring out the need for further updates and license fees to ensure that all of them work seamlessly together.
All in all, the required budget spans from the new technology and the labour in its implementation to the IT support and the need to integrate it into the existing technology. These can make the buying decision more complicated, but they also minimize the danger of wasting your marketing budget.
When budget availability becomes an obstacle in buying new technologies
According to Walker Sands’ State of Marketing Technology in 2016, 69% of marketers answered that budget is the main reason that holds their company back from investing in new marketing technology.
There was a similar response this year in Ascend2’s report, as 59% of respondents found budget restraints to be their top challenge when acquiring new technology.
These responses derive from the pressure to keep up with the latest trends, but also the struggle of finding the best martech solution that fits their existing budget.
On one hand, they want to beat their competitors with the latest technology that can bring them closer to their KPIs. On the other hand, the best marketing technology for their goals has to align with their budget.Most importantly, the stakeholders of the company need to be convinced that this is the right investment to improve the process and the goals across different departments.
The pressure for marketing leaders comes from the need to justify their decisions and prove in a practical way how each acquisition can impact the business goals.
The ultimate goal is to use the budget wisely to blend safe goals and worthwhile risks as part of their strategy.
As marketing technology is aiming to improve efficiency and productivity among the team, it’s important to discover how to combine the available budget with the desired ROI.
Blending budget with ROI
As marketing technology is still evolving as an industry, it’s common for stakeholders in a business to ask for a proof of the reasons to invest in it.
Small businesses may still be cautious about investing in shiny new technologies, while larger businesses need to justify every decision to a larger number of people. In both cases, ROI can make such an investment easier.
Budget and ROI come together in every new acquisition. The calculation of the cost and anything that the budget investment entails should be compared with the desired goals and whether they can be truly achieved.
It’s the estimated ROI that can prove whether a new investment can yield the desired outcome. This way a business ensures that it stays within budget while planning for its future goals.
As marketing technology can be an investment towards a future strategy, it’s critical to be able to measure an estimated ROI to prove its worth and remove the fear of failure. Businesses want to minimise the risk of wasting their budget while investing in the best technology that fits their budget and their goals.
Thus, a calculation of the return on investment for every new technology minimizes the chances of an underperforming choice or a poor selection.
The main questions to ask when analyzing your budget and the ROI of a martech investment are:
- How can I maximize the effectiveness of my marketing strategy with the right technology?
- What’s the best way to use my available budget to buy the right technology for our goals?
- How can I prove to everyone that this investment can be useful for the business?
In other words, how can you explain the ROI of a new martech investment to all the stakeholders? Will you be able to explore ROI that spans across different departments? How can it help you meet your marketing goals?
As with every investment, it’s important to prove its worth to justify the budget, both in technology and resources, and when to expect to see its ROI.
4 tips to make the most of your budget when investing in martech
Decide on your goals
A good way to use your budget is to align your goals with it. Once you decide on your marketing goals you’ll be able to find the best solutions that meet your needs. For example, if you focus on increasing the number of leads, then you’ll invest in the technology that will help you meet this target. This way your budget is spent on the solutions that match your needs and you reduce the chances of spending it without a proper direction. It’s a useful way to decide what matters most for your business, which features you need to improve and how they will help you improve your efficiency.
Build a martech roadmap
If your business in serious in investing in martech, it’s useful to build a martech roadmap to explore all the opportunities that show up. Not every investment needs to happen at the same time, but this doesn’t mean that you shouldn’t plan your needs ahead. A prioritisation can help you use your budget wisely, aligning your short-term goals with your longer plans. This will also allow you to keep up with the latest trends in martech and how they reflect your business objectives.
Allow budget for emerging technologies
Once you set up a martech roadmap, it becomes easier to allocate a part of your budget to new technologies. The focus may still be on the technology that will meet your KPIs, but you can also invest in the technology that will improve your future performance. This helps you beat the competition by organising the budget in a way that you’ll be able to test new technologies that fit your needs.
Work on a plan to anticipate the costs
A good way to avoid any financial problems is to work out on all anticipated costs in advance. A good communication with the other departments helps them understand the need to invest in marketing technology and how this aligns with the business goals. An upfront communication and planning saves you from unexpected costs that weren’t initially considered and helps you understand the actual budget that is required for each investment.
More marketers acknowledge the rise of marketing technology and according to Gartner’s CMO Spend Survey 2017-2018, they are already allocating 22% of their total marketing budget to technology.
In a similarly positive response to the rise of martech, Ascend2’s report indicates that 94% of marketers plan to increase the budget for marketing technology.
As the marketing technology landscape keeps growing, marketers are faced with the challenge of deciding how to allocate their budget. It’s becoming more important now to understand the importance of prioritization and explore how each new investment can help your company meet the set targets.
An investment that is not contributing to your marketing goals cannot be successful, especially when your business is having a limited budget. The emergence of new marketing technology should provide marketers with the opportunity to talk about the potential it offers, improving the communication among the business to explain its present and future value. This will increase the chances of a successful allocation of the budget to meet both current goals, but also future challenges.