What Do the Numbers Really Say About “Tech Stacks,” i.e., the Various Marketing Tools Used by Companies? How Can Saas Advisor Assist You with Your Software Challenges?
Similar to our article on "Are SaaS Solutions Terribly Underutilized?", rather than relying on often declarative responses from surveys, we will base our analysis on data—specifically, the latest report from Productiv. Productiv is a SaaS intelligence platform that helps companies manage their tool ecosystem (or Tech Stack). For this report, Productiv analyzed over 100 billion usage data points from nearly 100 million SaaS licenses managed by their platform over the past three years. So, what insights can we draw?
#1 Is the Number of Tools Used Increasing Drastically?
While the number of solutions recorded increased by an average of 32% from 2021 to 2023, we observed that after peaking in 2022, most categories of applications began to reduce the number of licenses used.
Will this trend towards consolidation continue? It is very difficult to answer this question. On one hand, companies and marketing departments may be instructed and aimed at reducing the number of applications (mainly for cost reasons). On the other hand, the marketing technology (Martech) market is constantly growing (2,000 solutions recorded in 2015, compared to over 11,000 today). This trend is unlikely to stop with the explosion of AI…
#2 Is Marketing the Department with the Most SaaS Licenses and Applications?
According to this report, marketing departments have an average of 75 solutions, including those used by several other departments. This is not a small number. However, it is less than the average of 83 technological solutions for the entire company, where the "engineering" and "operations" departments have more than 100.
Moreover, marketing, sales, or customer satisfaction teams use fewer solutions compared to IT and security teams. Ironically, these latter teams are supposed to guard against the proliferation of SaaS licenses…
In reality, marketing has the second smallest stack of tools.
#3 Is “Shadow IT” a Menace?
The term “Shadow IT” refers to software applications adopted by employees without explicit approval from the IT department. For security, compliance, financial, and support reasons, it is wise for the IT department to have visibility and governance over the applications used in the organization.
Thus, the Productiv report reveals that 51% of SaaS applications are considered as parallel IT. This seems enormous! One might easily feel that large systems are out of control. Marketing and communications are often presumed culprits in these shadowy maneuvers in the SaaS domain. But which applications truly contribute to shadow IT?
For Q1 2023, Evernote, Coursera, Canva, Grammarly, Trello… Among this top 20, we do not find any major MarTech or SalesTech solutions. Instead, we see employees using tools like Canva to create graphics to promote a meeting on Meetup… The line between applications and websites is very thin here.
SaaS Management for a Controlled and Efficient Marketing Technology Ecosystem
If this article and its three findings aim to challenge certain preconceived notions, they still reinforce the fact that companies and professionals often lack sufficient visibility and control over their tools. This is where SaaS Management becomes crucial.
SaaS Management allows for the mapping of all SaaS used within a company to ensure optimal management. At Saas Advisor, we firmly believe that these processes and tools will play an increasingly significant role, as they help streamline approaches across various stakeholders (business units, IT, legal, procurement, etc.) during the acquisition and deployment of a solution. And they help answer essential questions:
- Will this (future) tool meet operational and strategic needs? What use cases?
- Is it a “Must Have” or a “Nice to Have”?
- Does my organization have the resources to utilize a new incoming tool?
- How is its data collected? Where is it stored?
- How will the tool integrate into the existing ecosystem?
- Does the vendor have proven client cases? What are their support, training, and development capabilities?
If you would like to learn more about our SaaS management services
On the same topic, check out our article "SaaS Management: A 360° View of All Your Software."
