Editor’s note: The following post is part of a partnership with Creative Influence about marketing innovation happening in industries across Atlanta. The article is part of our Marketing Next series, which tackles both the marketing of innovation and the innovation of marketing. It publishes twice a month.
To get a pulse of Atlanta’s current MarTech ecosystem, we checked in with a dozen of the city’s experts in the field. From MarTech customers to category creators, capital providers to catalysts and consultants, they provide a snapshot of a market that’s matured and poised for a new level of growth. Atlanta’s ability to make good on aspirations of MarTech dominance may just be for real. But it will take three conditions to realize full potential: continuity, reinvestment and integration.
In Part 1 of this series, we took a look at CMOs as buyers and how Atlanta MarTech creators need to improve continuity and sales/marketing integration to win. Still, with 8,000-plus MarTech competitors nationwide, what are the odds of independent survival? We’ll look first, in Part 2, at whether there’s a sustainable consolidator in our midst. Then let’s look at the supporting players in Atlanta’s MarTech ecosystem and their role in helping the sector grow.
The Consolidated, consolidators and comfort players
Atlanta tech companies are historically the ones acquired rather than the ones doing the acquiring. In MarTech, the acquisitions of our marketing automation platform companies like Vitrue, Pardot, Silverpop, Clickdimensions and Salesfusion are examples but there are plenty of smaller ones, too. Email firm BrightWave was bought last year by a St. Louis marketing agency. And, B2B data tech company Synthio was bought by Austin-based Vertify earlier this year.
Consolidation in the MarTech sector makes sense. Not just because 8,000 competitors simply can’t all survive but because MarTech customers must have a more integrated set of offerings to improve effectiveness. Marketing and sales chiefs need MarTech consolidation which results in more coherent, complete, simpler solutions that drive more predictable results. Managing and paying for 100-plus different, silo-sustaining tools just isn’t cutting it.
Some may say that if you can run a profitable MarTech company with a loyal customer base – even if small and modestly scalable – that’s fine. It’s true that you can run a comfortable business as a niche player. No need to sell out. That is assuming the relentless pace of change in your marketplace doesn’t force you to grow or scale to survive against more aggressive competitors. It is true, too, if your niche is unique enough that CMOs are willing to tolerate your app - even if it stands alone from the rest of their revenue technology stack – because it’s too much of a pain to switch. The latter doesn’t sound like a sustainable strategy though.
The question is, will Atlanta continue to solely produce MarTech companies for cash-out, consolidation and comfort? Or, will we produce one or more consolidators? Because it is likely to be successful consolidators which dominate the market. Having one of our own in Atlanta is another key to keeping the MarTech flywheel spinning faster and more successfully here.
Terminus could play the part. As an account-based marketing pioneer, they sit at the center of sales and marketing. They’ve already acquired companies like BrightFunnel, Sigstr and Ramble Chat. SalesLoft might have the wherewithal to do it. They showed an inkling of acquisitiveness when they purchased opportunity management software provider Costello in 2019. And, Mailchimp has been acquiring companies including local MarTech firms like automated graphic design platform Sawa and, most recently, Inspector 6, an AI-driven marketing content platform.
“Another of Atlanta’s anchor MarTech tenants is Cardlytics which helps companies use credit card data to better target and measure their marketing. They went public, have critical mass and can acquire others,” said Lance Weatherby, VP at SugarCRM which bought Atlanta’s Salesfusion. Weatherby was an early part of Mindspring’s marketing team in the mid-90s and helped to lead marketing through the company’s acquisition by EarthLink. He’s led marketing as several Atlanta MarTech firms since then.
“Your core sales and marketing technologies are becoming platforms. Bigger companies are acquiring the piece parts they need. SugarCRM bought Salesfusion because they needed to add a marketing automation component to their platform. Atlanta has traditionally been better at building piece parts than platforms. We’ve have had trouble building anchor companies,” said Weatherby.
It remains to be seen whether the acquisitions by Terminus, SalesLoft and Mailchimp simply represent opportunistic activity or are reflective of long-term strategy for these Atlanta leaders: responding to their customers’ need for less market noise, more trustworthy go-to brands and more sales-marketing integration.
Category catalysts
Besides Atlanta’s marketing and sales customer base and our active base of new MarTech company creators, several kinds of catalysts fuel the sector here: marketing services providers, incubators and investors.
“There are a lot of agencies in Atlanta and they’ve helped to spur digital marketing innovation,” said Jeff Pedowitz. “There might be more digital marketing firms per capita in Atlanta than any other city in the country.” Many of those agencies have been around since the dawn of the first Dot Com era. Marc Adler started MacQuarium in 1994 while still at Emory and the firm continues to be a digital marketing staple focused on customer experience with big clients beyond the bounds of Atlanta. iXL was a high-flying digital consultancy from 1996 through 2002 and many of its alumni went on to do great MarTech things. Bill Nussey is an iXL alum. So is Mark Stevens, VP of strategy with Salesforce. Michael Kogon launched Definition 6 in 1997 and built it into a national competitor. Now owned by Navigation Capital (one of iXL’s original backers), Definition 6 has become a global player.
Many major agencies headquartered elsewhere have sizeable Atlanta offices. Huge is of particular note because – while headquartered in New York – its origins have some tieback to Atlanta. One of its co-founders, Aaron Shapiro, started an animated email company called Activegrams in 1996 that became part of Atlanta-based Avienda Technologies in 1999. In 2001, that company was renamed Silverpop. Shapiro helped start Huge in 2005. Meanwhile, in 1999, Michael Koziol left his job at BellSouth Intellimedia building interactive Yellow Pages to launch AntFarm - an early full-service interactive agency which he sold five years later. Koziol went on to cofound the Atlanta office of Huge in 2013 and ultimately became the firm’s global CEO.
“We're on at least the third generation of MarTech in Atlanta and that started in part with Atlanta becoming an early web development hub. iXL, 360i, AntFarm and others became big quickly and laid the groundwork for how people thought about marketing on the Internet,” said Lance Weatherby.
Since then, agencies of all sizes have also become sales channels for MarTech companies. Hubspot, for example, lists 59 agency partners in Georgia. So, in many cases, Atlanta digital agencies like Annuitas and Arke not only stimulate the use of digital marketing, they help provide clients the skills and tools to run those programs. “We often work together with other firms in town because we each come at the challenge from different perspectives,” said Chris Spears, co-founder and chief marketing technology officer at Arke. “Some are more focused on email-based technology while we’re a lot more focused on web, CRM and e-commerce technology than e-mail,” Spears added. One way that shows up is in the technology partnerships which firms promote. For instance, the Pedowitz Group website showcases its partnership with Marketo, Salesforce, Oracle Eloqua, Microsoft Dynamics 365 and Pardot. Arke’s partnerships are with firms like Sitecore, Episerver and FullStory as well as Salesforce.
Though Atlanta’s tech companies still pull significant investment from outside the city, our incubators and investors are also financial catalysts for Atlanta’s MarTech ecosystem. ATDC has at least seven active MarTech companies in its fold. Tech Square Ventures has money in Voxie, User IQ and Gauge Insights. Tech Operators is behind Matcha and Springbot – both of which now specialize in e-commerce-related marketing and sales technology. Matcha’s recent pivot to e-commerce content shows founder Fynn Glover’s persistence but also how Atlanta VCs are betting on smart entrepreneurs to find the right niche. Still, Atlanta tech investors have typically been rather conservative and that remains the case with MarTech.
“Atlanta investors are much more concerned about profitability over-growth right now. And that favors Atlanta companies because they’ve typically been more about profit than just growth at all cost,” said Adam Gautsch, marketing catalyst at ATDC.
That notion was echoed by Noro-Mosely’s John Ale who leads the firm’s MarTech investing. “MarTech as whole has become so saturated that in order to cut through the noise a solution must have a clear-cut return on investment,” Ale said.
Realizing full potential
Though Atlanta has had great successes, it is not the Silicon Valley of MarTech. The city’s ability to realize the full potential of its MarTech sector depends on its customers, creators and catalysts. As more Atlanta-bred MarTech solutions focus on supporting the increasing revenue-generation responsibility of CMOs and the blending roles of sales and marketing teams, there’s continued success in sight. If one or more of our current MarTech stars can become a consolidator and integrator and hold its independence, there’s continued success in sight. And, if the sector’s local catalysts help MarTech entrepreneurs leverage Atlanta’s inherent strengths to build enterprises that are both scalable and sustainable, the city’s got a real shot at MarTech greatness.
