The Difference Between AdTech and MarTech
Adtech and martech are common terms bandied about by marketers. However, a majority of the people don’t understand the major differences between the two. While they are both closely related to each other, they perform very different functions.
To put it simply, adtech refers to “advertising technology,” whereas martech refers to “marketing technology.” There are several key distinctions that set the two apart. By understanding the points where they converge and diverge, marketers can create more effective strategies and focus on data-driven personalization.
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What is Adtech?
Adtech simply refers to the technologies that allow for programmatic ad buying and digital spending. Tech advertising primarily focuses on demand-side and supply side platforms, as well as ad exchanges. With the help of advertising technology, companies are able to focus on a targeted audience.
This not only helps save a great deal of money, but also improves returns on advertising spend. The cost of consumer acquisition also dips sharply. It’s expected that digital ad spending across the globe is going to hit $130 billion by the end of 2021. Needless to say, adtech can help companies maximize the returns from their advertising spending by focusing on audiences that are actually interested in buying their product.
As you can see, adtech spending is only expected to increase in the future, especially as the world gets increasingly digitized.
Simply put, adtech focuses on data points, relevant attributes, and tailored campaigns. Adtech primarily measures the effectiveness of every campaign. Ultimately, this helps marketers get the best bang for their money.
The Adobe Advertising Cloud is an example of a tool that’s used commonly in adtech.
The two major platforms that play an integral role in adtech are demand-side platforms and supply-side platforms.
A demand-side platform is a digital platform, or a software program used by advertisers to purchase ads from a centralized marketplace. They can buy mobile, video, or search ads and manage them through a dedicated bidding network. Google Ads is a primary example of a demand-side platform.
Other major vendors include MediaMath and DataXu.
Most demand-side platforms retrieve data from third-party vendors and data brokers.
Why Are They Important?
In the past, ads were bought and sold by salespersons. Human ad buyers were used for brokering deals. Naturally, this was expensive, and the costs varied dramatically. Demand-side platforms remove the human element from the equation, thus making the process cheaper and much more efficient.
A supply-side platform is a software program that allows publishers to sell their ad inventory. Think of it as the publisher’s alternative to a demand-side platform. The underlying technology beneath demand-side and supply-side platforms is the same. Whereas advertisers use demand-side platforms to purchase cheap ads, supply-side platforms use supply-side platforms to maximize the price for their impressions.
Common examples of supply-side platforms include Google, OpenX, AppNexus, and AOL.
Why Are They Important?
Publishers actively avoid negotiating with human ad buyers for their media prices. Instead, they prefer using technology to buy ads in a more efficient manner. However, programmatic selling poses a risk: it could bring down the value of their inventory. A supply-side platform helps maintain a balance and allows publishers to effectively manage their relationships with several buyers.
Popular Examples of Adtech
One of the most common examples of an adtech platform is Tapad. At its core, Tapad is a simple tracking tool that assigns a unique digital ID to each user, and then tracks their activity on multiple devices.
This information is used by companies to target a user’s behavior when shopping online.
Another example is Undertone. Undertone helps its customers design advertising campaigns over multiple platforms. The company helps its clients create impactful pop-in ads that can help your business distinguish itself. The company focuses primarily on mobile advertising.
Broader examples of adtech include:
- Data management platforms
- Ad exchanges
- Ad servers
- Programmatic advertising tools
- Tag managers
Adtech primarily focuses on the use of programs and tools that can be used to analyze buyer behavior, evaluate the performance of ad campaigns, and improve them.
What is Martech?
Martech is simply marketing technology; the technologies that are used to execute a comprehensive digital marketing plan. Basically, all the technology used from the point of lead capture throughout the sales funnel until conversion is considered martech.
This can include the following:
- Email marketing tools
- Lead magnets
- Digital marketing analytics tools
- Customer data platforms
- Social media management tools
- Marketing automation programs
- Content marketing tools
- CRM software
You might have heard people referring to a “martech stack.” Essentially, this would refer to a series of technologies that are employed by a company in order to reach and convert potential customers. For instance, a martech stack could include a lead capture method, like an opt-in form, a dedicated email marketing tool to set up a drip campaign, and then data management tools to store their details.
Martech spending is only going to rise in the future. There are more than 8,000 tools that populate the martech landscape, and this number is only expected to grow in the future. That’s not all; 60% of marketing experts have stated that they expect martech to grow even more in the near future.
This is expected as a result of the global pandemic, and the shift towards remote work. Many marketing teams now rely on technology to manage their workload and target consumers online. A rise in investments in content marketing platforms is also expected in the near future.
Martech-specific tools are designed to help businesses understand their audience in a better manner. For example, if you publish a blog on your platform, you can use an analytics tool to determine the number of conversions that it generates.
You can track sign-ups and conversions through multiple tools, and then use that data to determine which topics are received better by your audience.
Here are some common examples of digital marketing technology that is martech-specific:
- Web analytics tools
- CRM software
- Content marketing tools
- Social media campaign management tools
Popular Examples of Martech
There are quite a few tools that you can use in order to nurture leads and nudge them along the sales funnel. These tools can also allow you to track the success of your marketing campaigns online and help you build a better relationship with your target audience. Here are a few examples of martech-specific tools:
- Mixpanel is a commonly used business analytics tool that tracks user interactions with a product. It allows users to analyze data such as sign-ups and conversions and help them track the effectiveness of different marketing campaigns.
- Buffer is a social media management tool that allows businesses to offer better support to their customers through social media channels. It is a marketing tool that helps businesses understand the needs of their customers better and tailor their product accordingly.
- Ahrefs is a search engine optimization tool that helps users identify the performance of their content and keep an eye on their competition. It allows users to track keyword search volume, rankings, and also has a backlink checker. Many businesses use it to improve their content and keep an eye on their competition.
- Alison is a creative analysis and ideation technology developed by yellowHEAD. Alison offers comprehensive, full-funnel data to help marketers track the performance of their creative ads and highlight top-performing elements.
Want to try out Alison for yourself and maximize your creative potential? Contact us.
Martech vs. Adtech – Comparison
Now that you understand the core differences between the two, here’s a small comparison table that summarizes the points given above:
|Main Focus||Using tools to reach customers who have interacted with the business; known audience||Targeting ads for relevant users; unknown audience|
|Users||IT teams, companies, in-house marketing departments||Advertisers, agencies|
|Approach||Nurturing leads via social media, email marketing campaigns, SEO, etc., highly personalized||Buying ads on high-traffic platforms, not personalized|
|Method of Billing||Subscription-based models mostly||Commission-based model|
|Data Collection||Personalized data collected||Relies on third-party data|
|Primary Platforms||Focus on free channels like SEO and email||Paid media channels like bidding on ad spaces|
Where Do Adtech and Martech Converge?
Many people confuse adtech and martech, and that’s primarily because the lines do get blurry between the two every now and then. Instead of using the two separately, many organizations have accepted the idea that the two offer greater advantages when used together.
Using a combination of adtech and martech-specific tools allows organizations to get a holistic look at their overall marketing strategy. For example, a number of martech tools have now begun to offer functionalities that were previously only available in adtech platforms.
As consumer habits become more and more digitized, technology solutions will work better when used in tandem with each other instead of being siloed.
For example, a company can use adtech platforms in order to visualize a user’s journey throughout their website. Then, this knowledge could be used to create campaigns that target customers based on their data. Landing pages could be optimized accordingly to get a clear idea of what a prospective user actually requires.
A marriage between the two can result in ads being specifically tailored to the needs of the user. Ultimately, what you are left with is a sophisticated ad campaign that targets users based on their digital behavior, thus yielding maximum returns on your marketing spend.
Businesses are increasingly looking at different ways by which they can employ both adtech and martech in order to segment their audiences in a better manner, which ultimately results in better value for the business.
The Bottom Line
We are seeing a paradigm shift amongst marketers as they rise up to the idea of combining adtech and martech together. Organizations are increasingly looking at ways to reach new heights, and a combination of the two could help paint a more holistic view of their target market.
Ultimately, this will only help boost conversions and maximize profits. Synergistic gains between the two will only help businesses in the long run. In the future, we will probably see MadTech, a mixture of both martech and adtech platforms that are deployed together to create a bigger impact on both advertising and marketing techniques.