martech evaluation

Why the Magic Quadrant No Longer Works for Martech

It’s time for martech categorization to evolve and provide the clarity marketers need. The labels have to change to fit the modern model.

Should you still stick to the whims of a Magic Quadrant in your martech evaluation?

CRM, ESP, MAP… there are dozens of rigid categories that industry analysts use to rate and rank marketing technology. But marketers don’t need acronyms; they need answers. It’s time for martech categorization to evolve and provide the clarity marketers need. The labels have to change to fit the modern model.


Marketers know the martech industry has come a long way in the past decade. According to the marketing landscape database, Martech 5000, there were only about 150 solutions on the market in 2011. Fast-forward to 2020, and there are now over 8,000 solutions available.

People shop and consume so much differently than they did 10, 15, or 20 years ago, and the way we martech pros evaluate and buy technology has changed in parallel. So, the sources that we use to inform our decisions must change as well. The traditional “Magic Quadrant” simply no longer works for the martech landscape.

In the old world, marketing automation technology was simpler because consumers and end-buyers didn’t have as much control. Marketers could generate leads via simple web forms, and that was enough. In this world, labels like “CRM” and  “ESP” were rigid, but they did a good enough job categorizing the martech market.

But in the new world, an explosion of app-based engagement and social influence has fundamentally changed how people buy things. And new marketing technologies have bloomed in response to the shift in buyer behavior. These tools are still often labeled within existing categories, but those labels don’t always match the capabilities — or help educate marketers about what solutions will really help them succeed.

Social media marketing, interactive web campaigns, and multichannel strategies are now the norm, not the exception. Martech buyers expect more than just tools that execute campaigns. They need solutions that create better customer experiences.

Improper categorization confuses buyers and doesn’t leave room for modern, experience-based marketing. For example, “marketing automation” is often labeled “lead management” and is categorized within “CRM.” But marketing automation isn’t just lead management. In fact, much of what marketing automation can do goes far beyond traditional “CRM” definitions. From customer experience management to engagement to content marketing and beyond, marketing automation can serve as a holistic solution to be used throughout the entire lifecycle and far beyond lead capture.

In this new environment, marketers are focused on growing their businesses and delivering on customer needs, not searching for solutions in a sea of martech acronyms. Simply put, the labels analysts use have been eclipsed by modern consumer demand. Martech buyers need more in-tune and current sources for understanding the technology market so they can make smarter investment decisions.

One Size Doesn’t Fit All: The New Martech Standards

As marketing solutions providers, we have to define our technology to match modern marketers’ needs rather than dated jargon being pushed by analysts for more than a decade. At the same time, mainstream industry analysis is informed by “enterprise bias” — the mindset that big enterprises set marketing trends. But marketers know that consumers, not companies, set the pace for innovation.

Rigid categorization forces the grouping together of tools that don’t serve the same purposes.

For example, email marketing and marketing automation technologies are often categorized as lead generation tools, but they help marketers meet very different goals — goals that go far beyond lead management.

So, improperly grouping these tools together and then ranking them against one another is confusing at best and very expensive at worst, especially if they inform the wrong purchasing decision.

The reality is, marketers are being asked to do more with less, so they aren’t shopping for the solutions they were once seeking. Budgets are being trimmed and staffing is impacted, too. The best solutions on the market today help marketers engage customers in data-driven and nimble ways, prioritizing seamless integrations so marketers can unlock greater value from their martech stacks.

Antiquated martech categorization might be designed to benefit marketers, but it doesn’t. This is true for analyst reports, listicles, annual rankings, and more. Martech offerings are now too diverse and too comprehensive to shoehorn into old-fashioned categories.

Customers Are in Charge 

From obsessing over making “top 20” lists to neglecting to take the time to effectively brief analysts on an emerging category, martech providers sometimes prioritize competition over differentiation. We should be focusing instead on customer experience as the key measure of success.

Ten years ago, many of the martech solutions that are now available didn’t exist.

How would we have rigidly categorized a social media listening tool, when social was still an experiment?

Why should martech providers fight to maintain rankings on lists while these lists become irrelevant?

Additionally, official industry categorization doesn’t come freely. Analysts subscriptions can be pricey and sharing reports can cost tens of thousands of dollars. At Act-On, we made the strategic decision not to participate in a major recent report — and our customers didn’t even seem to notice.

So, what’s the value to our business, if it’s not a value to our customers’ businesses?

Rather than trying to force our industry to fit into outdated boxes, why not find a new way to describe ourselves? Perhaps we could crowdsource categories and loop customers into the process. By defining vendor categories based on the benefits that matter most to customers, we can address the market more effectively.

Think New

How do we break out of the cycle and start focusing on what really matters? The good news is that paying attention to customer retention and brand enthusiasm is still the best gauge of how successful our solutions are. When the next ten years bring another thousand (or more) solutions into the martech industry, the goal is to navigate this increasingly crowded space by allowing customers to be the guiding light.

This is a massive opportunity for the analyst community (genuinely smart, thoughtful, and hard-working people) to revisit how it serves its own customers. When vendors focus on “making it” into quadrants, surveys, and reports that are based on old-fashioned frameworks and inaccurate categories, the whole industry suffers (especially customers).

Martech providers could partner with analysts in new ways to help educate and influence the market. Innovative approaches (from virtual roundtables to “documentary” productions using video content to Q&As with leading analysts) could deliver far greater value than the long timelines and outdated labels that come with so much traditional industry analysis.

Martech solution-makers must define the success of our solutions by one measure: the happiness and trust of our biggest stakeholders — our customers. To move forward as an industry, existing and emerging leaders must adopt a “new school” outlook on martech categorization that conveys the true value of each unique offering.

We have to stop confusing buyers at the very moment they are seeking clarity. We owe marketers and business leaders the ability to make informed, strategic decisions, not muddy the waters. We must place value on the things that really matter — understanding what our customers need and delivering the technology that deepens customer relationships and grows businesses.

david greenbergDavid Greenberg is the senior vice president of marketing at Act-On. Greenberg is a self-proclaimed brand loyalty enthusiast and brings more than 20 years of marketing leadership experience in high-growth technology organizations to the table. An early adopter of MarTech, he uniquely understands the challenges modern marketers face and strives to be an advocate and resource for growth marketers everywhere. With a firm belief that customers are more than just sales leads, Greenberg ensures all aspects of Act-On’s marketing and growth strategies are rooted a memorable brand experience.

This article originally appeared in MarTech Series. Photo by Josh Blanton on Unsplash.

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