By Brian Hansford, VP of Client Services at Heinz Marketing
The SiriusDecisions TechExchange is the best B2B event I have attended in a long time. SiriusDecisions research directors and analysts presented several frameworks that martech buyers (and sellers) can benefit from.
Gil Canare presented their Business Justification Framework which nicely structures how marketers can recommend a martech purchase. All of these steps prepare the buyer-advocate for the tough questions their execs and other stakeholders will undoubtedly ask. (Martech vendors can benefit greatly by selling their solutions in the scenarios described by this framework. The scenarios can help inform likelihood of winning the sale, in my opinion.)
The Justification Framework helps the buyer determine priorities in a logical manner to answer “why purchase now?” and “why this specific marketing technology?”. Future martech purchases will likely fall under increasing scrutiny for most marketers, and budgets will not expand every year. The glory days of buying endless subscriptions with hallway conversation justifications are over. This is a good thing for everyone because any future scrutiny will ultimately look at the initial justification. Especially if results fall short.
I have focused on an overview and not the depth of the overall framework session. We are in the midst of 2018 planning and the ideas here can be helpful.
SiriusDecisions and Creating the Justification for Technology
The Justification Framework walks the buyer through 3 core steps for building the justification. The steps focus on Drivers, Impact, and Justification. Current SiriusDecisions subscribers should have access to this information. If not, I highly recommend looking into subscribing to get the guidance. Or, at a minimum plan to attend the 2018 SiriusDecisions TechExchange.
1. Drivers – external and internal forces are in play. Drivers include everything from improving the internal business process to the need to improve marketing’s revenue performance. External drivers range from regulatory requirements, competitive pressures, and vendor upgrades and improvements. Purchase understanding and describing the types of purchase drivers. Each driver helps determine the justification. Purchase drivers fall into 4 categories.
- Forced – vendor service updates and regulatory pressures require the purchase
- Transformational – new capabilities
- Incremental – feature updates
- Rationalization – cost savings and improved stack management
2. Impact – all technology purchases have an impact. Balance the pros and cons in these impact category types:
- Cost – how much will the solution cost with licensing, consulting services, training? Look at the flip-side as well. What are the opportunity costs if the purchase is NOT made?
- Process – tech purchases should improve business workflow processes, not make them more complicated. Martech purchases have process implications across the organization, no matter how niche-oriented or strategic. Sales teams are impacted with the lead flow and learning new ways customers engage with marketing programs. Customer success teams and finance are all likely impacted somehow. Don’t underestimate or oversimplify process implications.
- Skills – this is a big one. Every new martech platform requires users with the skills to fully utilize the solution, administer, and integrate. Too many martech buyers overlook this implication of a lack of skills or not providing training to build capabilities.
- Organizational – complementary to process impact, in my opinion. The organizational impact can be small and easy to manage, medium with significant material change, or large with multiple impact scenarios and transformational change. Marketers must broaden their perception that all martech purchases will have organizational impact. People, process, data, and finances are all in play. Martech stacks have touchpoints throughout the customer lifecycle where other teams and departments also engage. Avoid the silo perspective.
3. Justification – Prepare to prove why the purchase is justified. There are many logical and compelling reasons for a purchase. Put the business case in writing with facts and data. Sorry folks, Shiny Object Syndrome is not justification.
Does the Technology Map to Key Goals?
We have reviewed dozens of marketing tech stacks over the last few years. Very few if any tech purchase decisions were made with measurable goals in mind. Most tools were licensed with the right intentions but few were justified in a structured manner.
Difference Drivers have Unique Purchase Scenarios
Consider how different Drivers each require unique justification. In some cases this exercise can prevent some embarrassment for recommending a tool there isn’t justification for. The Justification Framework prepares the marketer for the tough questions execs will ask. Preparation is good. Consider these scenarios:
Forced Purchase Driver
- How did we get here?
- What happens if we don’t buy?
- Do we use the same vendor or a new one?
Transformational Purchase Driver
- Is the purchase worth it?
- Does it align with our goals and values?
- How are other teams impacted?
- Can we wait?
- Will it be too disruptive?
- Is this the best choice?
Incremental Purchase Driver
- Why now?
- Are new capabilities worth it?
- Do they map to goals?
- Can we use existing capabilities without negative implications?
- Does an incremental purchase create excessive complications? (cost/benefit)
Rationalization Purchase Driver
- What do we get?
- What do we lose?
- Why this solution?
- Is what we’re using today good enough to help achieve goals?
The Big Steps to Technology Purchase
The heyday of marketing technology purchases will slow down. B2B marketing teams are increasingly accountable for achieving revenue goals. Marketers need to be smart about tech acquisition, and less emotional or enamored by cool features or vendor’s marketing. Business justification helps marketers focus on the right decisions and outcomes. Think strategically and place scrutiny on your idea as if you were spending your own money. Finally, work towards getting consensus, apply justifications consistently, establish a baseline for operational excellence, and always measure, review, and optimize.
How are you justifying your technology purchase proposals for 2018?