The rise of the rational technology buyer

Profile picture for user neil.lustig By Neil Lustig July 21, 2015
s the technology buyer finally becoming rational? Sailthru CEO Neil Lustig thinks so - and the implications for tech and marketing leadership are huge. In his first diginomica piece for Sailthru, Lustig explains the marketing/tech/data convergence driving the new buyer.


While the rise of the hybrid role of CMTO (chief marketing technology officer) continues to make headlines years after enterprises identified the need to bridge the marketing-technology gap, there’s a new technology buyer taking hold. It’s not another new role heralding the end of the great data divide, rather it’s a persona populated by a small but growing segment of marketers: the rational marketing technology buyer.

Isn’t this just a change of emphasis? Yes, but it’s a big change.

The truth is, CIOs and CTOs are known for being rational, if not overly so, when it comes to purchasing. Contracts are massive and implementations impact all areas of an organization. Marketers do not inherently have the same experience, but more importantly, the context in which they operate is shifting rapidly.

Technology training wheels are coming off in marketing departments around the world at a time when consumer behavior is completely different than it was five years ago. Couple that with a look at the this year’s ChiefMarTec Landscape (which has twice the number of vendors as last year’s) and it’s clear that we’ve moved into an age where technology is required for marketing to scale, but determining where to invest is the most significant challenge that marketers face.

This is what makes rational buying choices the most exciting advancement that I’ve discovered since taking the helm at Sailthru just three months ago. Moving to a market innovator after 16 years at IBM followed by 13 years at multiple enterprise pricing optimization technology vendors has meant a continual shift in perspective. It’s been this discovery of a new breed of buyers who approach their investments with rational thought that is one of my most interesting recent learnings.

It’s fascinating to see how marketers who are able to separate from the crowd based on an objective view are able to make sense of their complex surroundings. These are the ones to watch and learn from. Here’s why.

They aren’t looking to Amazon for answers

Amazon has changed consumer expectations in a way that now requires every business to adopt and adapt to a customer-centric approach using powerful tools. But Amazon is a company that hyper-invests in building its own technologies, which means its path isn’t the model of choice for most businesses. The rational tech buyer is not chasing Amazon, Alibaba and other ecommerce giants. Rather, they seek a competitive advantage over their direct competitors and to advance the customer-centric methodologies they’ve absorbed from industry behemoths.

Take onsite recommendations as an example. The Amazon methodology is to serve recommendations based on what other, similar users have purchased. However, marketers who combine measures of both interest and intent, serving recommendations based on those factors, can far eclipse the Amazon approach.

As our own Jeremy Stanley discussed in Data science in action – don’t confuse recommendations and predictions, savvy marketers are now using data science to apply new, rational approaches for recommendations and predictions. The new breed of tech buyer is one who seeks these advancements, rather than regurgitating the pursuit of the irrational through blunt force branding exercises.

They’ve dropped the “good enough” mentality

Rational marketers do not accept good enough because they recognize the necessity of transformation. There have been vast improvements made in collecting and leveraging customer data, but decades since financial organizations developed a single customer view most other organizations (especially retailers) are still struggling.

Organizational silos beget data silos and the rational marketing leader knows that it’s not just incremental improvements that are needed, it’s institutional change. This is one of the key reasons why we’re seeing this new marketer emerge from SMBs and especially in the high end of the mid-market tier: the companies are agile enough to evolve. Competition from larger enterprises and upstarts creates a pressure cooker that continually forces that evolution. Good enough just doesn’t cut it.

They are uniquely economics-focused

In an interesting shift, the rational technology buyer focuses on long-term ROI, rather than just TCO, and evaluates solutions against all alternatives including the cost of doing nothing. Success comes from seeking the path of highest risk-adjusted return, as opposed to making choices based on ease of implementation or shortness of learning curve.

To support making these decisions, this marketing persona is as aligned to their CFO as they are to their CIO. Rather than forcing multiple technology purchases through finance and technology for approval, they work cross-functionally in the formative stages to identify criteria for building the business case around a purchase and evaluating the downstream impact.

They aren’t focused on features, they’re focused on futures

When you’re changing the leadership of a company you look for vision and for the skills that are needed to get a business from where it is to where it needs to be. You don’t look for the skills that got the business to its current spot.

Similarly, rational technology buyers aren’t going after the same features they’ve seen from a dozen other solutions that week or evaluating new purchases based on the features that they’ve needed in recent years. Instead, they’re actively looking for partners that have a defined vision that aligns to their own and the drive to innovate on new features that are needed to move the needle.

A case that we see often is the reliance on WYSIWYG editors. Legacy email marketing platforms created this feature to edit and deploy email templates by dragging and dropping elements into place. In the age of visual merchandising and human decisioning, this was indeed a tremendous advancement. But the modern marketer relies on testing, personalization and a host of other algorithm-powered strategies to retain their customers.

The most progressive email marketers are moving towards a single template approach where all content is dynamically populated after being tested to determine where elements should be placed. It enables sustainable growth in email-borne revenue and a connected customer experience.

This matters as, ultimately, customers don’t care about the tools brands use; they only care that their experience gets better, richer and more relevant. Because these marketers recognize this and are invested in future revenue rather than interested in cookie-cutter features, they don’t need a WYSIWYG to be successful.

These buyers - like any other - don’t always know what they don’t know, but they’re willing to listen to those who aren’t always selling. They want to learn about the opportunities of today’s transformative technologies, especially when it can help them solve the challenges or support the prioritization of solutions that are crossing their desks looking shiny.

At Sailthru, we find this shift to the rational equally exciting and disruptive. We are constantly learning from our conversations with this new breed of rational marketing technology buyers.

Editor’s note: look for Sailthru at the CRM Evolution show in New York City, August 17-19. For a deeper look at Sailthru’s take on predictive marketing, download their Definitive guide to predictive marketing.

Image credit: Big science head © Sergey Nivens