A recent Gartner survey among CMOs showed that marketing budgets increased to 12 percent of company revenue in 2016. The same survey reveals the CMOs' Marketing Technology Spend Could Exceed CIOs' Technology Spend in 2017. IDC predicts CMOs will spend over $32BN on marketing technology in 2018.
Marketing software can deliver a lot of value, getting marketing people very excited very fast. The trendy apps come and go. Native advertising, mobile commerce and social marketing are just a few of the initiatives on their way from the peak of inflated expectations to trough of disillusionment according to Gartner.
Every such trend spawns new tools. Financial implications go far beyond the cost of a single application. With every campaign, marketers also need analytics, social media, content support etc. The compound cost quickly reaches a few thousand dollars per month. The dust settles quickly but way too often the subscription costs remain as nobody cleans up when the party's over.
The cost of wasteful subscriptions can exceed $100.000 in a 250 people company. That’s a lot of money that could be used to grow the business. When the marketing company Moz analyzed their costs, they realized they can save $500k of $1.7mm software costs.
Some companies have documented how a lack of financial discipline resulted in financial problems and the need to lay off very talented people. A few examples: Buffer, Moz, Optimizely. Ironically, your marketing is very likely using all of these applications. We all know who has to deliver the bad news to to the board. It’s better to do the cleanup before things go south and use the savings to fuel growth.
How to take control and prevent overspending
Going through the list of dozens software subscriptions with your CMO can bring substantial savings. If the CMO doesn’t keep a list of marketing software subscriptions, you can help them by asking your financial controller to pull data from your accounting system.
Going over the list is a matter of asking simple questions - who’s using it, do we still need it, can we cancel the subscription? A single meeting with the CMO is more than enough to have a plan in place and start realizing savings. And given the size of CMO’s technology spend, the savings can be measured in tens of thousands of dollars! Of course, you must keep CMO accountable that the plan is followed and the savings realized.
While the above routine is not terribly time consuming, it still takes time away from growing your business. And if you want to repeat the routine every couple of months and do it also with your head of sales, H&R, engineering, and other departments, the time required to keep your SaaS spending at bay can become substantial distraction to you and your team.
We’ve built Cleanshelf to automate the process of tracking, optimizing, and benchmarking your cloud software subscriptions. While you can certainly optimize your SaaS spending manually, it’s a tedious process that machines are better equipped to do. If this sounds interesting, get in touch and let us show you how Cleanshelf can reduce your SaaS spending by tens of thousands of dollars with minimal disruption to your team.