Interview

Michael Vaclav is the co-founder of brandREACH, one of the leading marketing and sales automation agencies in the DACH region, where he serves as a Senior Consultant for Marketing & Sales Automation. In addition to his main job, he leads the Expert Group Marketing Automation of the Dialog Marketing Association Austria (DMVÖ) as part of his board activities and teaches marketing and sales automation at FH Campus02, as well as at other private and public educational institutions.

Austria has made great strides in development in several areas of Martech, what do you think has contributed the most to this?

I believe several key factors have contributed to the rapid advancement of Austrian companies in the Martech space:

International Exposure: Many Austrian companies operate on a global scale (e.g., Magna, Mondi, Red Bull, Kapsch), which has exposed them to international Martech trends. These companies often serve as pioneers, introducing innovative Martech solutions to the domestic market and accelerating overall adoption.

Government Incentives: Austria provides substantial support for the digitalization of small and medium-sized enterprises. Through free consultations and financial incentives, the government helps to alleviate one of the biggest hurdles—budget constraints—making Martech adoption more accessible.

Advanced Infrastructure: Austria has made significant investments in modern infrastructure and administration. This commitment is reflected in the EU's Digital Economy and Society Index (DESI). For instance, 5G coverage in Austria already reaches 95% of the country, exceeding the EU average of 81%. Robust internet connectivity is the cornerstone of digitalization and Martech.

Innovative Ecosystem and Education: In recent years, many curricula at universities and technical colleges have been revamped to incorporate Martech content into marketing and sales programs. Additionally, Austria hosts numerous conferences, workshops, and events dedicated to advancing the field of Martech.

These factors, working in synergy, have positioned Austria as a frontrunner in Martech adoption and innovation.

What specific strategies have Austrian companies used to drive their Martech development?

I believe the following three key factors have driven the successful adoption of Martech among Austrian companies:

Data-Driven Marketing: It's rare to find an Austrian company that doesn't recognize the pivotal role of data in modern, effective marketing. As a result, there has been a substantial investment in technologies like CDPs, marketing automation tools, and advanced CRMs.

Cloud Adoption: Traditionally, Austrian companies leaned towards on-premises IT infrastructure. However, the July 2023 implementation of Privacy Shield 2.0 facilitated access to US-based tools, prompting many Austrian businesses to transition from legacy systems to cutting-edge cloud-based Martech solutions.

Partnerships and Collaboration: The integration of data, cloud services, and system overhauls is a complex undertaking that necessitates changes in both technology and operational approaches. To navigate these challenges successfully, many Austrian companies have partnered with technology and/or consulting firms, such as ourselves.

How do you assess Austria's position compared to other European countries in Martech?

Martech is such a broad spectrum that providing a definitive answer to this question is challenging. Other factors like company size and industry introduce significant variations. Let's consider some examples from the EU's Digital Economy and Society Index (DESI):

AI Adoption: Approximately 11% of Austrian companies utilize AI, surpassing the EU average of 8%. This indicates a higher rate of AI adoption in Austria.

Cloud and Data Analytics: While around 47% of Austrian businesses employ cloud or data analytics, this figure falls slightly below the EU average of 55%.

eCommerce: Austria has shown a strong presence in digital eCommerce, with 6% more small and medium-sized enterprises selling online compared to the EU average, though the lead compared to previous years has narrowed.

The point I'm making is that comparing Martech adoption across different countries is complex due to the vast scope of Martech itself. Moreover, the diverse factors influencing adoption make it difficult to arrive at a single, accurate average.

Which areas within Martech do you think Austria will invest most in in the future?

That's a fascinating question. Specifically, what timeframe are we considering? The next year, the following 3 years, or the next 5?

In terms of absolute spending, I anticipate that the largest portion of Martech budgets will be allocated to marketing automation. Despite many Austrian companies already utilizing marketing automation, there's a widespread recognition of significant untapped potential in this domain. Consequently, beyond licensing costs, investments will also be directed towards personnel, training, and consulting.

Relatively speaking, I believe most companies will venture into AI. This could start with new roles like a Chief AI Officer to objectively assess potential applications within the organization and could extend to substantial investments in standard software or even the development and training of proprietary AI models.

What challenges have you identified in maintaining this rapid development?

From my perspective, there are two primary factors that could, and likely will, slow down this rapid development.

Market Saturation: As more and more companies implement Martech, fewer new companies will follow suit. The real work for companies only begins after the technical implementation. Marketing professionals must first get a feel for what they can do with the new technology. Once this phase is complete, it's about developing and implementing all the new processes. This still requires many hours of work from the people involved.

Skilled Workforce: This leads us to the second point. There are unfortunately far too few people who are truly knowledgeable about specific Martech solutions. Of course, this number will increase over time, but currently, we still have a shortage in Austria. Universities, universities of applied sciences, and private educational institutions are therefore called upon to further improve and expand qualification measures.