What Exactly Is a Martech Stack? – AdAge.com

The Martech conference is conveningin San Francisco this week. Credit: George Slefo

The TL is a part laundromat, part high-end coffee bar, and it's just around the corner from this year's Martech conference at the Hilton Union Square in San Francisco. It's the type of place that can dry your undergarments while also serving you a delicious cup of java.

James Thomas, CMO of ultra-hot marketing technology startup Allocadia, is there, sipping his cappuccino out of a paper cup. The seven-year-old company, with clients including Microsoft, GE and Phillips, provides insights into things like the return on investment for sponsored events. It also aims to show what type of return brands get when they advertise on Facebook, among other things.

Thomas, a curly-haired man with a slim build from Vancouver, is giddy because in a few hours Scott Brinker, editor at ChiefMartec.com, host of the Martech conference and godfather of all things marketing technology, will crown Allocadia for having one of the best "martech stacks."

I don't know exactly what a so-called martech stack is, so Thomas explains.

"Think about a car," he says. "It has a collection of parts and technology, but ultimately, its job is to get you from point A to point B."

"A martech stack, in this case, is a number of different technologies from a number of different companies that's meant to attract and retain customers in the most efficient way possible." To combine into a machine, that is, that gets marketers all the way from point A to point B.

Allocadia is just one of 5,381 different companies that operate in the marketing technology space, up from 150 in 2011 by Brinker's count. And nearly all of them are laser-focused on providing brands data in areas like workflow management, content, social media or analytics.

Over at the Martech conference expo hall, 4-year-old email marketing company Iterable claims they're snagging clients like AT&T and Yelp away from behemoths like Salesforce because it's easier to use and take less time to integrate data than competitors.

"Say someone starts creating a profile on CareerBuilder, but exits out before uploading their resume," an Iterable salesman says. "That's a hole in the funnel. We specialize in plugging that hole by messaging the person on whatever device they're on. We get them to come back to CareerBuilder and finish building their profile."

Wrike, which specializes in workflow management, says its customers include Tesla, Sony Playstation and Hulu.

"It just blows my mind when I go on LinkedIn Jobs and see how many of them require applicants to know how to use Wrike," says a sales associate. "Slack is one thing when you're managing one or five people, but how do you manage hundreds for a big project? That's where Wrike comes in."

Companies like Allocadia, Wrike and Iterable are among the 30 or 40 -- sometimes more -- different parts that make up a marketing technology stack. Outfits like these are aggressively pursuing a new breed of marketer called "chief marketing technology officers," whose primary duties include selecting different vendors to assemble the stack. Microsoft, for one, has added such roles to build out its stack.

"It's chaos," Thomas says of choosing vendors to make an optimal martech stack. "We're making it really hard for marketers."

To hear Thomas explain it, picking which vendors to work with is difficult because there are so many, and most can't easily integrate with one another.

The whole idea of having a martech stack is to create a one-to-one relationship with the consumer. And imagine knowing when the best time to reach that person is, on which device and with what creative.

That's martech's sales pitch, and legacy brands like Nestl, for example, are buying into it. Microsoft recently described the companies that it has pulled together into the marketing stack that it uses for its own marketing, which consists of several dozen different companies. An operation of such scale, Thomas says, would cost at least $15 million per year.

And that's not including the cost of mantaining a team with the chops to integrate and make sense of all the "Big Data" that's going to come through.

"The idea of the stack is to bring order to the chaos," Thomas said. "There's so much data and things like AI are helping make sense of all of it, but we're still one or two years away."

Each stack is built around a "core" -- think Marketo, for example. But it then branches off into different areas like data acquisition and management, content creation, SEO and social. None of this is integrated into one giant, easy to use platform, either. Instead, teams are put in place for each of the branches, experts at using and understanding each of the different companies' offerings. Data from the different branches eventually gets plugged into the "core" of the stack.

Of course, there's a lot more to it and it's still too early for many brand marketers to start worrying about what their martech stack will look like. Ultimately, though, they'll get there, according to Thomas.

"The people who say, 'Half my money spent on advertising is wasted; the trouble is I don't know which half' are going to get fired," he said. "Why? Because the technology to measure it is already out there."

~ ~ ~ CORRECTION: An earlier version of this article said Allocadia was two years old. The company is seven years old.

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What Exactly Is a Martech Stack? - AdAge.com