By: Alan Azar, Head of MarTech & Analytics at Reprise Digital MENA (IPG Mediabrands)

Another year down and more grey hair to show for it. Even though COVID-19 is behind us, 2022 continued with the theme of economic uncertainty, this time driven by geopolitical conflicts, inflation, trouble in the markets and global layoffs at big tech.

Digital transformation leading up to COVID-19 had been a luxury with C-levels focusing on process-oriented transformation and automation only to realize the biggest driver of change was coming from the greatest C of all (COVID-19) and it was going to be a matter of survival. Soon after, we started seeing transformation across Marketing to keep up with quickly changing customer expectations resulting in brands having to provide more personalized digital experiences to consumers. 

Next year will continue to see demand from businesses and the same level of focus and planning needed to continue to grow and survive. Hopefully, this article gives those of you useful context and advice.

About MarTech

In simple terms, MarTech is any technology that helps automate or empower Marketing teams to optimize their operations to achieve their objectives.

From marketing automation to analytics, customer experience (CX) and machine learning, MarTech has grown exponentially over the last decade. Scott Brinker’s Chief Martec blog, a renowned source for everything MarTech, now documents close to 10,000 companies operating in this space. What is interesting is that 30% of these companies launched post-COVID-19 with growth mostly driven by data, content & personalization.

According to a recent study by eMarketer, businesses in the US are expecting to increase their investments by 28% on MarTech over the coming two years, and this excludes spending on hardware and professional consulting services.

What’s driving growth: External factors

In addition to COVID-19 creating a mad dash for businesses to sell DTC (Direct-To-Consumer) and be at the mercy of fragmented marketplaces, there has been the (still) on-going industry changes related to data privacy.

The combination of dealing with GDPR or even anticipating evolving local data laws, browsers (excluding Chrome) stopping 3rd-party cookie tracking and shorter conversion windows, Apple’s 14.5 iOS (and updates since) has left marketeers that relied on external data sources severely limited.

The effects on marketing are reduced capabilities to identify and retarget outside of walled gardens and the inability to optimize marketing channels effectively, leading to wastage through duplication across platforms and devices. Ultimately, creating a reduction in ROAS (Return-On-Ad-Spend); an actual reduction as you cannot optimize efficiently and a perceived reduction as you are not able to track marketing activities effectively.

What’s driving growth: Marketing

While dealing with the loss of data and insight, outside of a business’s digital assets has had profound consequences on its own, the need to deliver a better digital experience, through personalization and relevance, and to optimize growth, through re-targeting and CLV (Customer Lifetime Value) management, has always been there. The difference now is businesses must invest in their own marketing tech stack as they are losing the ability to rely on external sources.

Each business has the richest dataset of their customers, their behaviors, interests, and purchases, yet unfortunately, what we have seen across industries is the under-utilization of MarTech, including tech that has already been deployed.

What’s driving growth: IT

The IT & tech side of the business have been playing an important role in Digital Marketing Transformation as they work closer with the functional teams to understand the needs & use-cases and procure & implement the required technologies alongside professional services.

For IT & InfoSec, every new tech opens the business to more security and compliance risks. What is interesting though, is we are seeing a lot of CDP (Customer Data Platform) discussions that are initiated by IT to better govern how 1st party data is utilized across different platforms and by different functional teams. CDPs are excellent technologies to centralize 1st party data from multiple sources, stitch identities into a SVOC (Single-View-Of-Customer), create advanced segmentations & analysis and most importantly, activate those audience segments across paid media and marketing channels.

MarTech in MENA

Within MENA, we see big regional businesses already heavily investing in MarTech. These are usually businesses in retail, banking, telecom, airlines, and not just global companies where tech is dictated from their head office., the Middle East’s only media platform focused on marketing technology, most recent (2021) survey of 320 CMO’s and brand managers from the Middle East found more than half (60%) of CMO’s agree that their MarTech stack has been constantly evolving to keep pace with challenges in complex customer journeys, rising customer expectations and siloed or insufficient data.

In 2021, 28% of CMOs spent over a quarter of their marketing budget on MarTech vs 19% in the previous year, with more than a third (35%) saying MarTech investments will rise 15-30%.

The two most urgent focus areas for more than 70% of CMOs are customer acquisition and growing revenue. Following a data-driven approach to marketing, CMOs prioritized investment in the following three areas in 2021: Customer Data Platform (43%), Business Intelligence (34%) and Content Management System (22%).

Trends in 2023

#1 Businesses you do not expect to see in this space will try to build their 1st party data strategy

Retail, Banks, Telecom, airlines will still lead the way, but we will see businesses that do not have 1st party data start to look at creative ways in building it. We are already starting to see this in the CPG and QSR space.

#2 KSA will move quickly in investment and adoption

Saudis are no strangers to change as they have fast forwarded digital transformation in every aspect of business and life in recent years. During the Vibe MarTech Fest in Riyadh, the conference was noticeably different than in Dubai as attendees were highly engaged to learn more and connect with partners. From a data perspective, Saudi is also one of the highest countries in the world affected by the loss of 3rd party cookie tracking due to the high penetration of iPhones (~52%).

#3 MarTech companies will continue to invest in the region and open local offices

Tealium, one of the top leaders in the data orchestration and Customer Data Platform (CDP) space, have been operating in the region for over 4 years. The increasing awareness of having a 1st party strategy has been driving Tealium’s growth in the region. In addressing the talent shortage especially among women, Tealium recently held an event “Women in Tech” with a roundtable of leaders sharing their experiences, advice, and lessons learnt, helping women to grow professionally and claim their seats at the ‘technology’ table.

More recently, Optimizely launched the MENA office in February 2022 alongside their Global CEO Alex Atzberger showing their commitment to the region. Optimizely are leaders in the fast-growing space of Experimentation & CRO and are driving adoption of testing & personalization by brands in the region.

#4 Data silos & inconsistent definitions across functions will remain

Consistency in data & language across teams will continue to remain a challenge for businesses. Having the right data & analytics foundation in place ensures correct data recorded at the source, however, data flowing across tech and between teams is not always consistent. These challenges will remain while businesses continue to mature on their path in Digital Marketing Transformation and build up an analytics culture across functions.

#5 Talent shortages will remain

It is already incredibly difficult to find good talent in this space (worldwide) and, with the rate of growth, it is becoming even harder to retain that talent. While many businesses look at fully in-housing, the reality is that it is easier to rely on expertise & multi-product-trained talent sitting with consulting agencies. Ideally, businesses should have an internal team to internally manage stakeholders across all functions while externally collaborating with partners.

#6 Professional consulting services will grow

While 10,000 MarTech companies continue to show the markets demand for niche products, it also exposes a major problem where businesses are overloaded by choice and find it difficult to figure out how to piece it altogether. Professional consulting services bring expertise in helping businesses decide what is right for them, implementation, training, and managed services.