Martech is consolidating, but what will the 2022 landscape reveal?

Martech Acquisitions 2019-2020
Upcoming Tuesday, May 3 — Martech Day! — we’ll launch the 2022 marketing technology landscape, along with a Point out of Martech report. You can be a single of the 1st to see it and master about the important tendencies it reveals by joining Frans Riemersma and me for a live webinar at 11am Jap. You can sign-up for free right here.

You could already be leaping to a conclusion. “It would seem like each and every other week, I read through about a significant acquisition. Definitely the 2020 martech landscape with its 8,000 solutions was Peak Martech! The only concern is by how substantially has the 2022 landscape shrunk.”

Maybe.

Without a doubt, the martech industry sees a incredible amount of M&A activity. LUMA Associates, a single of the top expense financial institutions in martech — and the creators of the original adtech landscape that encouraged us over a 10 years back — publishes quarterly experiences of known specials. There were being 157 in 2019, 85 in 2020, and 166 in 2021.

About just one out of each individual 5 of individuals was a deal valued at $100 million or additional. These big acquisitions almost generally make the information. Last yr, there had been 37. On common, that is 3 for every thirty day period that likely garnered headlines in industry publications.

It is a testomony to just how huge the martech business is that so quite a few considerable acquisitions are continuously developing. All individuals headlines obviously give the perception of significant consolidation.

But though that consolidation is real, as a proportion of the full selection of martech remedies, these known acquisitions are 2% or so of the total landscape. In the meantime, new martech startups and other more recognized firms continue on to enter the house. Ironically, consolidation is typically a catalyst for additional software to be developed.

Martech Platform Leverage

Consolidated platforms make it much easier for software package builders to make apps on best of them. If you’re standing on the shoulders of giants, the bigger the large the greater. And the less giants you have to select among, the improved too, as it is a lot more most likely it is that the a person(s) you pick will have scale and remaining power.

These optimistic opinions loop dynamics — generally framed as “winner takes all,” even if in truth there are usually quite a few huge winners — is why AWS, Microsoft Azure, and Google Cloud are so dominant as cloud platforms. And they are still increasing at a extraordinary rate. But in the process, they’re birthing tens of millions of applications crafted on top of their foundations.

The increase of ecosystems and marketplaces in SaaS corporations even more allows the Cambrian explosion of commercial professional apps as very well as tons of tailor made applications tailored to unique enterprises. They help solve the challenges of discovery and integration.

Meanwhile, need for specialised program proceeds to grow as well, as reported by the range of SaaS applications that corporations have in their stacks:

SaaS App Adoption

We’re getting into a article-digital-transformation period, where companies are no longer arranging to turn into “digital.” They are electronic. And as they now contend ferociously for competitive strengths in their digital functions and electronic customer ordeals, they’re more and more comfy acquiring and making a lot more specialised application.

Advertising continues to be just one of the most intensive domains in which that levels of competition requires position — offering martech entrepreneurs sufficient possibilities to build benefit.

Traders nevertheless feel in these possibilities far too. They continue to fund new and expanding martech ventures. If you pick up a duplicate of LUMA’s Q1 2022 Marketplace Report, you are going to see the hundreds of hundreds of thousands of dollars in cash set into martech corporations just in the to start with three months of this yr.

That claimed, there are rational restrictions for how quite a few martech companies can exist at a single time and how several martech apps any a single firm can usefully adopt. Whilst new martech products and solutions are constantly born, previous kinds fade absent into mergers, pivots, and discontinued oblivion.

The queries the martech landscape has answered just about every calendar year are: (1) what is the equilibrium concerning martech growth and consolidation and (2) what is the composition of options inside of the total martech marketplace? Those responses expose a large amount about the ongoing evolution of promoting.

What will the 2022 martech landscape reveal? Tune in upcoming Tuesday to come across out.

We’re likely to launch a little something truly exclusive this 12 months that I warranty you’ll want to be 1 of the first to have access to.

P.S. Researching the martech landscape has grow to be a project of epic proportion more than the decades. And with the exclusive surprise we will be unveiling this year, the hard work to generate it has developed even far more. We wouldn’t have been ready to do this without the fiscal aid of a number of generous sponsors:

If you have not taken a search recently at the ground breaking martech remedies these firms are manufacturing, test them out. It is remarkable.

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