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Is that vendor a zombie?

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Is that vendor a zombie?


In the wake of the first dot-com bubble bursting twenty years ago, Forbes published an excellent piece called “The Undead.” It profiled some struggling enterprise software vendors sitting on large piles of cash because they IPO’d at pumped-up valuations just before the 2001 crash. Most of them did end up burning through the rest of their cash and getting sold off, though it took a while for some of them to depart the marketplace.

A new generation of zombies

I won’t opine here about whether we’re living through another tech bubble, but as a martech evaluation firm, at Real Story Group, we do see quite a few “zombie” vendors: not quite dead, but not fully alive either. As a tech customer and martech leader, you’ll want to be on the alert for zombies in your portfolio.

Two decades later, the situation has changed a bit. I see a new generation of undead tools and vendors, less because they bulge with IPO cash, but rather because they’ve aged to a point where they subsist off profitable maintenance streams (usually supporting legacy systems in environments where customers cannot easily switch out) while keeping R&D to a minimum. In some cases, cloud-based delivery models help sustain younger zombies because they can more readily marginalize their expenses relative to revenues.

This potentially becomes an important consideration because major industry analyst firms typically lag in their vendor assessments and can stamp an imprimatur of vitality to an otherwise declining player. Consider the case of the Interwoven content management suite—one of Forbes’s “undead” in 2002. Forrester and Gartner lauded the firm for more than a decade, even as licensees labored under mountains of technical debt. Most of the Interwoven portfolio still wheezes away at OpenText, its fourth domicile in ten years.

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Senior living options

OpenText itself is a kind of multi-tiered senior community for aging software platforms. It purchases older solutions, sets them up with independent apartments, then transitions them through assisted living, hospice care, and on to what the tech community quaintly calls “sunsetting.”

OpenText is not alone. This business model has also attracted the likes of Verint and Upland in the martech/customer experience space. Typically these roll-up vendors will have one or two home-grown platforms, but mostly they purchase older toolsets on the cheap, cobble them into “solution bundles,” limit future development to bug fixes and centralize back-office functions.

This model is great for investors, and in some cases, you, the licensee as well. Any high-functioning community needs to deal with aging members. Just understand that — despite what a sales rep may tell you — their platform is not going to innovate substantially and will increasingly struggle to integrate with newer parts of your stack. At best, you sustain very good support.

Other models

Some zombies carry on solo. Consider the former IBM martech portfolio now gamely trying to survive at Acoustic and HCL. Or Sitecore’s flagship “Experience Platform” web content management system, which has been given a three-year prognosis. These are platforms you leave, not license afresh.

Meanwhile, some open source projects subsist on an “age-in-place” strategy, where their communities keep them alive, albeit not very active in the world.

And what about younger zombies? They’re out there, sometimes with structural problems hidden behind venture-boosted coffers. Tell-tale signs include declining volumes of new licensees, reduced headcounts, and higher-than-average churn rates. Even in the vibrant customer data platform market, where RSG evaluates nearly three-dozen platforms, some vendors have plateaued. Note Upland recently acquired CDP vendor BlueVenn. You’ll see more in the next few years.

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In nearly all cases, though, the vendor tends not to disappear entirely, and this gives you time, typically measured in years, to adapt and respond.

What you should do

Most martech zombies aren’t lethal and are unlikely to eat your stack. Though left unaddressed, they can create an increasing drain on your resources—and staff morale.

When you identify a zombie, you typically need not rush to the exits, but you do need a replacement plan for the long run. One key consideration is where the solution fits in your “Martech Mall.” If it’s a boutique solution, perhaps adequate support (if you can get it) is all you need right now while you focus martech innovation on more vibrant platforms.

On the other hand, for an anchor platform in your martech mall, you’ll want to make active plans to replace any zombie. And under no circumstance should you license a zombie platform for a new implementation. What’s been your experience? Let’s discuss on LinkedIn.

Real Story on MarTech is presented through a partnership between MarTech and Real Story Group, a vendor-agnostic research and advisory organization that helps enterprises make better marketing technology stack and platform selection decisions. Opinions expressed in this article are those of the guest author and not necessarily MarTech. Staff authors are listed here.

About The Author

Tony Byrne is founder of Real Story Group, a technology analyst firm. RSG evaluates martech and CX technologies to assist enterprise tech stack owners. To maintain its strict independence, RSG only works with enterprise technology buyers and never advises vendors.

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Taboola automates personalized homepages

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Taboola automates personalized homepages


The new Homepage For You offering announced by native advertising and discovery platform Taboola will use AI to automate the curation of relevant and personalized content on websites’ homepages. The automated surfacing of content likely to engage readers will complement editors’ existing ability to curate homepage experiences.

Among publishers already using the solution are McClatchy and The Independent. Beta testing showed a 30-50% increase in CTR with use of the tool. The dataset on which recommendations are based includes some 500 million daily active users.

Why we care. Adam Singolda, CEO and founder, said in a release: “If you open up a social media app, you are greeted with content you really want to see. For publishers, the most loyal readers are those who visit a homepage directly and look for editors to tell them what’s important for them to know.”

This is a telling argument. Social media channels like Instagram, TikTok and YouTube present personalized, curated experience the moment they are opened based on the user’s previous behavior. A solution like Taboola’s should take publishers in the direction of being able to compete — although many publishers will still want to strike a balance between editorial content and native advertising.


About The Author

Kim Davis is the Editorial Director of MarTech. Born in London, but a New Yorker for over two decades, Kim started covering enterprise software ten years ago. His experience encompasses SaaS for the enterprise, digital- ad data-driven urban planning, and applications of SaaS, digital technology, and data in the marketing space. He first wrote about marketing technology as editor of Haymarket’s The Hub, a dedicated marketing tech website, which subsequently became a channel on the established direct marketing brand DMN. Kim joined DMN proper in 2016, as a senior editor, becoming Executive Editor, then Editor-in-Chief a position he held until January 2020. Prior to working in tech journalism, Kim was Associate Editor at a New York Times hyper-local news site, The Local: East Village, and has previously worked as an editor of an academic publication, and as a music journalist. He has written hundreds of New York restaurant reviews for a personal blog, and has been an occasional guest contributor to Eater.

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How to Develop Brand Architecture

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How to Develop Brand Architecture


Just like every building needs a foundation, every business needs brand architecture. It’s the structure that allows you to organize your offerings, develop a brand identity, and gain brand equity.

(more…)

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Webinar: The next big thing in ABM

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When it comes to prioritizing digital experiences, it's either now or never


Account-Based Marketing is essential to any B2B strategy. And advanced practitioners are now looking for the tools to give them an edge to better connect with their audiences.

This requires sales and marketing to work together to identify and engage buying groups within their target accounts. Enter Buying Group Marketing.

To learn more, register today for “Market, Engage and Sell to Buying Groups Who Want to Hear From You,” presented by Influ2.

The post Webinar: The next big thing in ABM appeared first on MarTech.



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