Golden Handcuffs: How do young, fast-growing tech companies keep hold of the best marketeers?
By David Holton, Director of Americas
Up until now, young, fast-growing tech companies have enjoyed their pick of the best young marketing talent coming through the ranks, as well as some of the top executives at the senior end looking for a change of direction, new challenge, better work life balance or something close to their heart.
Why? The answer is what we call Golden Handcuffs.
Tech giants such as GAFA (Google, Amazon, Facebook, Apple) have been able to rely on algorithms to market their various products, advertising alternative products from the same parent company with a minimum of effort. Click an address on an iPhone and it auto defaults to Apple maps, search for an Echo on Amazon and you’ll buy direct from Amazon, or a Google Play on Google Shopping.
Collectively, these four have such a hold on the market that:
- Google and Facebook control almost 60% of digital ad revenue in the US and 64% of mobile ad revenue.
- Apple has about 45% of the US smartphone market.
- About 47% of all U.S. e-commerce sales go through Amazon.
So what’s changed?
In March 2019, Google was fined $1.7billion for breaching anti-competition laws in Europe, using its dominant position to restrict adverts from rivals on its Adsense platform. This follows a $5billion fine in 2018 for charges relating to abuse of Android and mobile apps, and a £2.7billion fine in 2017 for charges relating to Google Shopping. With annual revenues pushing $200billion, Google can afford it. For now.
Currently, the US isn’t going down the same route as the EU, but Federal courts fined Microsoft in the 1990s, when their PCs auto-defaulted to the Windows Internet Explorer web browser. Sound familiar?
Whether or not the US does, things are starting to look very different. Large tech giants are now having to hire actual marketers in Europe rather than relying on algorithms. This in turn is causing a problem for the companies that need these people most: young, fast-growing tech companies.
Increasingly, we’re finding that good candidates are being employed by the bigger players, who’ve realized that to stay ahead on a level playing field, they need to invest in the best available marketing talent.
So now the ball is back with the young, fast-growing companies – what do you think they can do to attract and retain the best marketing talent?
To discuss in confidence how Marketing Moves can support your organisation’s growth, please contact David by any of the means below: