The Swiss Army knife of modern marketing procurement
Marketing technology (MarTech) has emerged as the Swiss Army knife of modern business strategies, combining tools that promise efficiency, data-driven insights, and a competitive edge. However, navigating the complexities of MarTech procurement, integration, and value realization is anything but straightforward. Two recent discussions at Procurecon Marketing 2024 highlighted key challenges and actionable insights that procurement leaders and marketing strategists need to tackle. Panelists and speakers joined from a wide array of companies such as Crowdstrike, Lantheus, JM Smucker, Vail Resorts and Charter Communications. The session was moderated by Jason Cammorata, a true industry expert.
Martech: A Symphony of Tools or a Cacophony?
One panelist humorously remarked, “MarTech is anything that’s not people.” While simplistic, it captures the essence of an industry that spans everything from customer relationship management (CRM) platforms to advanced data analytics tools. The explosion of MarTech solutions — 14,106 systems (yes…) as of 2024 — has created both opportunities and headaches for businesses.
Andrew Jonson, from JM Smucker emphasized the challenges of siloed purchases: “I have four people talking to the same vendor about the same product. My job is to get everyone back on the same page.” Consolidation and integration were recurring themes across both sessions, underscoring the importance of internal alignment before approaching vendors.
The Procurement Perspective: Data, Dollars, & Deadlines
Data security and ROI were top concerns for procurement teams. Jason from the panel summed it up: “You’re either slowing innovation down or facing lawsuits. Pick your poison.” The risk-reward balance becomes even trickier with AI-driven tools. Many companies, such as Vail Resorts, extend their procurement review processes for AI-based tools to ensure strict compliance and never inadvertently training algorithms with sensitive data.
From a financial perspective, recurring concerns revolved around budgeting and pricing transparency. James Robin from Vail Resorts shared a common frustration: “You think you’ve negotiated a great deal, only to find the vendor has changed the product functions come renewal time.” This bait-and-switch strategy from vendors underscores the need for robust contractual terms, including price protections and clear definitions of service deliverables.
Best Practices for MarTech Procurement
Duke Diep from Crowdstrike delivered a very insightful and action oriented workshop on the negotiation of MarTech. Here are his best tips:
- Start with Stakeholders: Before engaging with vendors, ensure internal teams are aligned on needs and goals. “It’s not just about cost per license; it’s about whether the tool drives actual business value,” one panelist noted.
- Push YOUR Paper: Contracts that favor the buyer’s terms, rather than relying on vendor-supplied agreements, offer more control over data usage, liability, and compliance. “Vendors love to use their paper because it’s stacked in their favor. Push your paper all day, all night,” advised one participant.
- Define Data Ownership and Migration: Many procurement horror stories stem from unclear terms around data. “We assumed the data was stored in the U.S., only to find out later it was offshore,” one speaker recalled. Ensure contracts specify where data is stored, who owns it, and what happens during termination.
- Enforce KPIs and SLAs: While vendors often resist specific performance metrics, longer-term contracts offer better leverage. “Start low, build historical data, and adjust annually,” recommended a CrowdStrike representative. Service Level Agreements (SLAs) should also include uptime guarantees and penalties for non-compliance.
Challenges in Negotiation
The MarTech negotiation session highlighted the difficulties in achieving favorable terms. Limitations of liability, indemnification, and termination clauses often become sticking points. “Some vendors act like they’re doing you a favor by being in the room,” joked one attendee. However, the proliferation of tools and vendors has introduced a silver lining: increased competition.
One of the best tips across all MarTech sessions!
Andrew Johnson shared a success story about simplifying vendor comparisons: “We sent out a simple checklist: ‘Can you do this? Yes or no?” It cut through the noise and helped us consolidate five tools into one.”
Data Privacy: The Elephant in the Room
GDPR, HIPAA, CCPA, and an evolving patchwork of state and global regulations make data privacy a focal point in MarTech negotiations. A pharmaceutical representative highlighted their struggles: “We’re trying to anonymize data for field use, but new privacy laws pop up faster than we can adapt.”
Smaller vendors, while offering niche capabilities, often lack the resources to meet stringent compliance requirements. This forces companies to make calculated risks. As one panelist put it, “Sometimes, you’re rolling the dice. You just hope the stakes aren’t too high.”
The Human Element in MarTech
While much of the conversation centered on tools and contracts, the human element was not ignored. One panelist emphasized the importance of relationships: “Your vendor’s sales rep is your biggest advocate. Treat them well, and they’ll fight for you internally.”
Training internal teams on SaaS agreements and fostering collaboration between procurement, IT, and marketing was also highlighted. A humorous yet insightful takeaway came from a participant who compared MarTech procurement to buying a car: “Separate price and financing. Keep your leverage.”
Moving Forward
MarTech is a fast-moving, high-stakes arena that rewards those who stay proactive and collaborative. As the sessions demonstrated, the key to thriving in this space lies in marrying robust procurement practices with a deep understanding of business needs. As one panelist aptly concluded: “MarTech isn’t just about buying tools; it’s about building a strategy. The tools are just the enablers.”
For businesses navigating this complex landscape, the advice is clear: stay informed, stay aligned, and never underestimate the power of a well-negotiated contract.
